Kaplan & Norton - The Balanced Scorecard

The Structure of Concern Project compares many theoretical models from many disciplines to the Adizes PAEI model, arguing that they must all be reflecting the same underlying phenomenon. One concern structure model is described below.

The Balanced Scorecard has evolved from a tool for strategic planning into a major business and organizational paradigm for strategic management, and I do not plan to summarize it in its entirety here. It is based on several insights, one being that people in organizations fulfill those goals they are being measured against. If performance on a task type is not being measured, it will not be a priority for people at work. Furthermore, financial accounting is an inadequate measure of organizational behavior. It measures past productivity, whereas Kaplan and Norton (1996[1]) insist that four perspectives on performance really need to be measured in organizations. In PAEI order, these are:

P – Financial: To succeed financially how should we appear to our shareholders?
A – Internal Business Processes: To satisfy our shareholders and customers, what business processes must we excel at?
E – Learning and Growth: To achieve our vision, how will we sustain our ability to change and improve?
I – Customers: To achieve our vision, how should we appear to our customers?

1. Kaplan R. S., Norton D. P. (1996) The Balanced Scorecard: Translating Strategy into Action. Cambridge, Massachusetts: Harvard Business School Press.
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