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The Balanced Scorecard: the Customer Perspective

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The Balanced Scorecard: The Customer Perspective

The Balanced Scorecard, designed by Dr. Robert Kaplan and David Norton, has transformed the perspective through which the organizations and firms measure their performance and success. Rather than focusing and relying only on financial measures, such as return on investment and earnings per share, the Balanced Scorecard offers a simplified but broad observation of the entire organization. In addition to the traditional financial perspective, this innovative performance measure also analyzes the organization from a customer satisfaction, internal business, and innovation and learning perspectives.
We often hear that the ultimate goal of an organization is to maximize shareholders’ wealth; however, we seldom hear that the only reason any company or organization exists is to provide products and services that satisfies the needs of the consumers. Keeping in constant tune with consumers’ wants and needs, which are nowadays by and large in constant motion, provides the organization the ability and the opportunity to generate sustainable profits. Given that consumers is what keeps a business alive, it is essential to analyze how customers perceive the organization by measuring their level of satisfaction and to incorporate this analysis into its performance measures.
The analysis of customer satisfaction sheds light into the different areas of the business that need to be address internally in order become or remain successful. These measures will fluctuate from firm to firm. Consumers may place priority on a range of variables, such as cost, quality, performance and service, and time. Knowing what customers value, allows the organization to strategically focus on internal operations that will satisfy their expectations. In general consumers have a wide variety of choices for the same product or service. Therefore,…...

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