The established key performance indicator system “Balanced Scorecard” forms the bridge between strategy development and the practical implementation of a company. The management system visualizes the strategic goals and key figures of a company in a simple and clearly structured manner. The classic financial key figures are supplemented by customer, market, process and knowledge perspectives. The various departments measure, plan, document and finally translate the data into practical measures. These must be relevant, practical, realistic, and actionable.
Robert S. Kaplan and David P. Norton developed the Balanced Score Card in the early 1990s to further improve the effectiveness of a corporate strategy. Their guiding principle was “Translate strategy into action.” The Balanced Score Card takes into account the interests of all stakeholders of a company and is much more than a pure key performance indicator system: in addition to financial and result-oriented variables, non-monetary elements such as the number of new customers are also included in the analysis. Special attention is paid to the balance of the different key figures in order to ensure a target-oriented implementation that takes into account the most diverse aspects for corporate management. Thus, the balance (“balanced”) is combined with a clear reporting system (scorecard).
The Balanced Scorecard usually consists of the four management perspectives in the most frequently described form:
– Financial and value perspective
– Market and customer perspective
– Internal process perspective
– Innovation and knowledge perspective
The “e-performance scorecard” emerges from the balance scorecard. The management consultancy McKinsey has developed these to manage the customer loyalty of e-commerce activities, such as an online store.