The concept of the Balanced Scorecard (BSC), developed by Robert S. Kaplan and David P. Norton, links enterprise strategy to operational business processes, forming a framework for the distribution of resources in a firm. The BSC is often misunderstood as simply a grouping of key figures in four perspectives, where purely financial figures are augmented by non-financial ones. Key figures are certainly an important component of the BSC, but they do not comprise its backbone. Kaplan and Norton see the BSC as a strategic management system with the following aspects (Kaplan/Norton 1996a, also refer to the interview with David P. Norton in section 7.1):
1. Transparently formulated strategies
2. Communication of the strategy throughout the whole organization
3. Alignment of the strategy with the goals of employees
4. Linking objectives to the annual budget
5. Pinpointing of and agreement on strategic initiatives
6. Regular Performance Measurement with confirmations, and any strategy
changes
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