The Development Course of Balanced Scorecard

The embryonic stage of balanced scorecard (1987- 1989)

Before RobertS Kaplan and DavidP Norton studied the balanced scorecard, analog device(“ADI ") first tried the balanced scorecard in 1987.

ADI is a semiconductor company, which mainly produces analog, digital and digital-analog mixed signal processing devices. Its products are widely used in the fields of communication, computer and industrial automation. Like most other companies, ADI adjusts its strategic plan every five years, and reviews the implementation of the original plan while making a new strategic plan. However, just like the strategic problems that managers often encounter, after "making a strategic plan" is regarded as a "task", the documents formed are shelved and cannot be implemented in the daily production and operation of the company.

1987, ADI began to adjust the strategic plan again. Different from before, this time, the decision-makers of the company realized that the strategy should not only pay attention to the formulation process itself, but also pay attention to the implementation of the strategy. They hope that through face-to-face communication with employees, they can fully understand and agree with the company's strategy. At the same time, the company's top management also hopes to closely implement the strategy in daily management to promote the implementation of the strategy. This time, ADI's strategic document has changed greatly in form. They abandoned the previous dozens or even hundreds of pages of strategic documents and compressed all the strategic documents into a few pages. In the process of formulating the strategy, ADI first identified the company's important stakeholders as shareholders, employees, customers, suppliers and communities. Then, under the company's mission, values and vision, Adi set strategic objectives and defined three key strategic priorities according to the "interests" of the above stakeholders.

In order to ensure the realization of strategic objectives, especially the three strategic key objectives, ADI has implemented a subproject called "Quality Improvement Process", which is called QIP(Quality Improvement Process) for short. At the same time of the project, ADI continued to transform the key success factors to achieve the strategic objectives into annual business performance plans, and thus derived the prototype of the world's first balanced scorecard: in the process of implementing total quality management in ADI, the company specially invited some management scholars to participate in the implementation of activity-based costing (ABC). Professor Robert S. Kaplan of Harvard Business School is one of them. He himself described how he discovered Adi's scorecard: "In the process of visiting and sorting out cases, a scorecard used by a company's top management to evaluate the company's overall performance was also textualized. In addition to traditional financial indicators, this scorecard also includes customer service indicators (mainly related to delivery time and timely delivery), internal production processes (output, quality and cost) and new product development (innovation). "

Kaplan discovered ADI's balanced scorecard in the process of helping ADI promote ABC, and realized its important value. Although Kaplan and Nolan-Norton made academic deepening in the later period and extended it to enterprises all over the world, Adi's contribution to the balanced scorecard can not be avoided and ignored.

Theoretical research period of balanced scorecard (1990- 1993)

A few days after Professor Robert S. Kaplan discovered the first balanced scorecard of ADI, he and David P. Norton, president of strategic groups Fuxing, started the theoretical research on the balanced scorecard.

The research topic of balanced scorecard begins with the performance evaluation of the company. 1990 Nolan-Norton, strategic groups established a new company performance appraisal model for one year. David P. Norton, CEO of Nolan-Norton, is the project manager and Robert S. Kaplan is the academic consultant. General Electric Company, Dupont Company, Hewlett-Packard Company and other 12 famous companies participated in the project development. The project team focused on the in-depth study of ADI's scorecard, and expanded and deepened its performance appraisal, and named the research result "Balanced Scorecard". The final research report of the group elaborated the great contribution of the balanced scorecard to the company's performance appraisal in detail, and established four assessment dimensions of the balanced scorecard: finance, customers, internal operation and learning development.

1At the beginning of 992, Kaplan and Norton summarized the research results of the balanced scorecard in Harvard Business Review, which was their first paper on the balanced scorecard. The title of the paper is "Balanced Scorecard-Driving Performance Indicators". In the paper, Kaplan and Norton elaborated on the benefits gained from participating in the initial research project of 1990 to evaluate the company's performance by using the balanced scorecard. Shortly after the publication of this paper, Kaplan and Norton were invited by several companies, and the balanced scorecard began to attract the attention of the business community.

The second important milestone in the theoretical research of balanced scorecard: Kaplan and Norton extended the balanced scorecard to the strategic management of enterprises in 1993. In the initial practice of enterprise balanced scorecard, Kaplan and Norton found that balanced scorecard can convey the company's strategy. They believe that the balanced scorecard is not only a tool for company performance appraisal, but more importantly, it is also a tool for company strategic management. Kaplan and Norton published the second important paper "The Application of Balanced Scorecard in Practice" in Harvard Business Review, in which they clearly pointed out that enterprises should choose performance evaluation indicators according to the key success factors of enterprise strategy implementation.

The popularization and application period of balanced scorecard (1994 till now)

After Kaplan and Norton extended the balanced scorecard to the strategic management system of enterprises in 1993, the balanced scorecard began to be widely accepted and recognized by the global business community. More and more enterprises benefit from the practice project of balanced scorecard, and the balanced scorecard has also been extended to non-profit organizations.

Take the United States as an example Relevant statistics show that by 1997, about 60% of the top 500 companies in the United States have implemented performance management, and this proportion is even higher in so-called financial services such as banks and insurance companies, which has nothing to do with the overall excellent performance of American companies in the 1990s. Let's look at the government. BSC was put forward in the early 1990s. By 1993, the US government passed the Government Performance and Results Act. Today, almost all departments and departments of the US federal government and most state governments have established and implemented performance management.

The balanced scorecard was first implemented in many enterprises in the United States, and now it has been extended to enterprises in many countries around the world. The top managers of China enterprises who have implemented the balanced scorecard project all praised the great contribution of the balanced scorecard to their practice when they talked about strategy and performance management together today. In the industry, the balanced scorecard has been involved in almost all industries, and the demand for balanced scorecard by enterprises in various industries (even some non-profit organizations) around the world is also increasing exponentially every year. In 2003, the survey of Balanced Scorecard Cooperative Private Limited Company showed that 73% of the surveyed enterprises in the world were implementing or planning to implement the Balanced Scorecard in the near future. 265,438+0% enterprises hold a wait-and-see attitude towards the balanced scorecard; Only 6% of enterprises do not intend to implement the balanced scorecard: the balanced scorecard has been widely recognized by enterprises in the United States and even around the world, which indicates that the balanced scorecard has entered the era of popularization and application! However, in the process of popularization and application of the balanced scorecard, its theoretical system is constantly enriched and improved.

From 65438 to 0996, Kaplan and Norton continued to publish the third paper on the balanced scorecard in Harvard Business Review. On the one hand, they reiterated the importance of balanced scorecard as a strategic management tool for enterprise strategic practice; On the other hand, I learned the essence from peter drucker's management by objectives, and elaborated the framework of the balanced scorecard as a strategy and performance management tool, including setting goals, making action plans, allocating budget funds, performance guidance and feedback, and connecting salary incentive mechanisms. In the same year, they also published the first monograph on the balanced scorecard, The Balanced Scorecard, which elaborated the above two aspects of the balanced scorecard in more detail.

With the popularization of 200 1 balanced scorecard in the world, Kaplan and Norton published their second book "Strategic Center Organization" on the basis of summarizing the successful experiences of many enterprises. In this book, Kaplan and Norton point out that enterprises can establish internal organizational management mode according to the company's strategy through the balanced scorecard, so that the core process of enterprises can focus on the strategic practice of enterprises. The publication of this book indicates that the balanced scorecard has become an important tool for organizational management.