Performance Management and the Balanced Scorecard

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Performance Management and the Balanced Scorecard

Introduction

Most successful businesses employ some sort of performance management system as a means to measure the effectiveness of their human capital and business processes. There are many different types of performance management systems in use, and some are more effective at producing actionable results than others. Those systems that can utilize key business indicators together with a motivated, engaged workforce focused on constant improvement while working towards shared company goals tend to be the most useful and provide optimal results.
In order to be most effective, employee performance management systems must produce measurable results that contribute to organizational success. Many companies utilize a Balance Scorecard approach to promote ongoing and continuous improvement and measure effectiveness of their teams and business processes. This paper will demonstrate that when properly implemented, the Balanced Scorecard is an effective employee performance management system that combines regular feedback with individual objectives aligned to corporate goals, and seeks the contribution of all stakeholders in the corporation in order to achieve organizational success.

Effective Performance Management

The term “performance management” can mean many different things to different organizations, and tends to vary widely depending upon the complexity or formality of the type of performance management system in use. Many companies rely on a combination of basic or traditional business indicators such as financial performance, sales goals, etc., and subjective opinions or intuition of managers to determine overall performance effectiveness. But proper performance management goes beyond the intuition to the reality of what is happening on the shop floor, and aligns what line staff employees are doing…...

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