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The IUP Journal of Business Strategy
An Empirical Study on Balanced Scorecard as a Measurement and Management Tool for Corporate Performance
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In an era of global competition, the corporate sector contributes a major part to the performance of the national economy. Measuring and managing corporate performance has always been a matter of concern for the internal and external stakeholders. For this purpose, financial perspectives have been in use for long. But it cannot be denied that measurement of performance involves multidimensional approaches as use of financial perspectives alone cannot give a truthful picture given their confines. Accordingly, there arises the need for application of multidimensional approaches for measurement and management of corporate performance. This paper attempts to understand the strategic corporate performance management tool—Balanced Scorecard (BSC)—which admits the insufficiency of financial measures and suggests evaluation of the companies in terms of how they create future value through investment in customers, suppliers, employees, procedures, technology, and innovation. Following four perspectives, viz., financial, customer, internal business, learning and growth, BSC balances these objectives among non-financial and financial, leading and lagging, operations and finance parameters. BSC in India is studied through its application in healthcare and fast moving consumer goods industries. The four customary perspectives of BSC have been studied with some suggested additional perspectives through a survey of 36 companies.

 
 
 

A new approach to strategic corporate performance management was developed in the early 1990s by Robert S Kaplan and David P Norton. They named this system as ‘Balanced Scorecard’ (BSC), which recognized some of the limitations of the conventional measurement approaches and provided a lucid prescription as to how the performance can be better measured by the companies.

BSC is a measurement as well as a management system that facilitates organizations to explain their vision and tactic and translates them into action. It provides feedback around both the internal business processes and external results for improvement of strategic performance and results (Kaplan Norton and Lowes, 1996). BSC transforms strategic scheduling from an academic theory into the nerve center of an enterprise.

 
 
 

Business Model Innovation, Global competition, Corporate sector contributes, National economy, Balanced Scorecard (BSC), Strategic corporate performance management tool.