Balanced Scorecard Perspectives
Definition
The Balanced Scorecard perspectives are the four categories Kaplan and Norton use to group objectives and measures: Financial, Customer, Internal Business Process, and Learning & Growth. The grouping exists to force balance — a set of measures drawn from all four covers both the results a business reports and the capabilities that produce them.
Financial asks how the organization looks to shareholders. Customer asks how it looks to the people it serves. Internal Business Process asks which activities it must do exceptionally well. Learning & Growth asks whether the people, information, and culture exist to keep improving. Financial and Customer measures are mostly lagging; Internal Process and Learning & Growth are mostly leading. Public-sector and non-profit adopters commonly reorder them, putting mission or Customer on top and treating Financial as a constraint.
Balance across four boxes is easy to fake. Learning & Growth thins out most often, because skills, systems, and culture are the hardest things to quantify, so the perspective fills with attendance counts and survey scores that no decision depends on. Strict four-way splits cause the opposite problem: a team required to produce measures for a perspective it does not genuinely influence will produce measures nobody uses.
Example
A 120-person manufacturer runs four to six measures per perspective: Financial (gross margin 31% to 36%), Customer (on-time delivery 88% to 96%), Internal Process (scrap rate 4.1% to 1.8%), Learning & Growth (cross-trained operators 12 to 30).
See also: Balanced Scorecard software