Why Does Business Need a Balanced Scorecard?

An organization's measurement system strongly affects the behavior of people both inside and outside the organization. If companies are to survive and prosper in information age competition, they must use measurement and management systems derived from their strategies and capabilities. This chapter illustrates why it is critically important that organizations move beyond traditional financial measures to embrace the Balanced Scorecard, which highlights a more general and integrated set of measurements that link current customer, internal process, employee, and system performance to long-term financial success.