Financial Daily from THE HINDU group of publications
Wednesday, Nov 23, 2005


Group Sites

Corporate - Outlook

`Balanced Scorecard - a management concept for future'

Ambrish Jha

Mumbai , Nov. 22

WHY is it difficult for successful companies to remain so on a continuous basis? Is it because companies only focussed on the financial numbers?

Yes, says Dr Anil Naik, a consultant and an expert on this concept called `Balanced Scorecard'.

"Balanced Scorecard gives a picture of the future," says Dr Naik. "There were many successful companies like Nirlon, Paragon Textiles, Mafatlal in the past. Where are they now? They failed because they could not devise proper strategy for the future," Dr Naik told Business Line on the sidelines of a seminar organised by Indian Electrical and Electronics Manufacturers' Association (IEEMA) here recently.

`Balanced', as the name suggests, calls for a balance between financial and non-financial measure, long term and short-term objectives and external and internal performance. `Scorecard' initially came into being as a measurement system, and gradually evolved into a core management system.

Dr Naik said Balanced Scorecard continues to emphasise on the financial performance measure but at the same time highlights future performance drivers, key initiatives to be taken and provides a framework for strategic management. It has been designed around four perspectives - financial, customer, internal and learning and growth.

In Balanced Scorecard, financial perspective is always important. But a healthy revenue growth, proper utilisation of assets and investment strategy are also must for any organisation.

Balanced Scorecard articulates customer and market-based strategy that will deliver super value to customer, build customer loyalty and bring superior financial results. It specifically looks at the value proposition that the organisation will deliver to the customer in target market segment. It propagates building better understanding and leveraging relationship with customers.

It identifies critical new internal processes in which the organisation must excel for future financial performance, Dr Naik said.

Learning and growth perspective includes employee training and corporate cultural attitudes related to both individual and corporate self-improvement.

According to Dr Naik, learning and growth constitute the essential foundation for success of any knowledge-worker organisation. "In the current climate of rapid technological change, it is becoming necessary for knowledge workers to be in a continuous learning mode," he said.

Government agencies often find themselves unable to hire new technical workers, and at the same time there is a decline in standards of training of existing employees. "This shows in the working of the government," he said.

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

More Stories on : Outlook

Stories in this Section
L&T bags Rs 252-cr orders in electricity distribution

GlaxoSmithKline prepares to bring bird-flu drug to India
Toyota Kirloskar rolls out 2 lakh cars
`United Phosphorus wrongly implicated in Volcker Report'
Nagarjuna bags highway project
Manisha joins GV Films board
AstraZeneca Plc to sue Ranbaxy on ulcer drug
Indian Oil to raise $250 m from international market
NTPC unit bags global award
Calcutta HC dismisses Laxmi Realtors petition
ICICI Venture to buy 26% stake in Viceroy Hotels thru pref offer
BBC seeks nod to pick up 20 pc in Radio Mid-Day
Swiss group picks up stake in RR Investors
Taskforce on HMT-Praga Tools merger
Saint-Gobain outlines phase II expansion plan
US consortium to pick up 19 pc stake in Himalya International
Sahara One pact with Spacetoon for kids entertainment content
Iffco sets up joint venture in Egypt
NDTV joins Direct TV, Sky platforms to reach US, UK markets
A study tour
`Shredders market in India still at nascent stage'
ONGC seeks reimbursement of payments made for partners
Polar Pharma eyes US, European markets
`Balanced Scorecard - a management concept for future'
Jay Shree Tea: Divergent show by fertiliser, tea divisions
Delhi High Court orders winding up of Data Access

The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription
Group Sites: The Hindu | Business Line | The Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |

Copyright 2005, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line