While there is some value in the senior management team having a better set of performance measures, the real transformational power of the Balanced Scorecard approach comes from how it taps into the creative and motivational power of the entire organization to create focus and drive performance improvement. When properly used, the Balanced Scorecard approach makes strategy everyone’s business, and it enables organizations to successfully put strategy into action. Organizations often have many different initiatives as people make a wide variety of non-coordinated efforts to make improvements. Those efforts may be part of a formal Six Sigma, ISO 9000 or Quality program or they may just be the individual decisions and efforts of hundreds of employees that are each trying to be effective in their jobs. Research by Norton and Kaplan found that only about 5 percent of the employees in a typical company had a good understanding of the company’s strategy. Therefore, all the energy exerted to make improvements is diffused and fails to result in breakthroughs in performance. When the Balanced Scorecard approach (not just a report card) is communicated to the entire organization and when systems and processes are adapted to reflect the strategic focus, the multitude of decisions and initiatives that go on in an organization can be focused for a much greater impact.

It is somewhat ironic, that when talking to consultants or organizations that have had dramatic success as a result of their Balanced Scorecard journey, there is a noticeable downplaying of the terms and concepts of “balanced,” “scorecard” and “measurement.” Instead, they emphasize “strategy,” “alignment,” “communication,” and “initiatives.” This suggests that the name “Balanced Scorecard” no longer is an accurate reflection of the best practices that bear that name. Given the 10+ years of brand recognition that have grown around the term “Balanced Scorecard,” it is not likely to be quickly abandoned. People who explore or attempt to follow this methodology will need to make the extra effort to go beyond the simple assumptions about what it is all about. For those that do, they should find a rich and growing base of best practices and success stories that suggest that the Balanced Scorecard has a long and bright future.

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