The Goal of BSC for Strategic Level Planning

What is the role of BSC for strategic level methodologies of organizations? Before we will be able to answer that, let's take a short trip down to memory lane first. A balanced scorecard is a measurement framework that is used to track an organizations performance. Drs. Kaplan and Norton first brought up the idea in 1996 and has since become a sensational tool that in fact, an average of at least 50% of companies all over the world has learned to utilize them. It should not come as a surprise if sooner or later, all organizations will adopt this trend.

I do agree when people say that there are a lot of business terms and sometimes, there is just no way to memorize them all. I am not saying that it is for that reason that the BSC for strategic level is standardized, but you have to admit that remembering three simple terms that will enable you to sum up all your goals and utilize your BSC for strategic level methodology purposes optimally. These three terms are:

-Corporate level

-Business Unit level

-Functional or Departmental level

To develop a BSC for strategic level tactics with respect to each one, you have to know the differences between these three. Let us start with the Corporate level.

Basically, there are four areas that a corporate level strategy is really concerned with:

1. Reach - What type of business should the corporation involve themselves with? What are the goals? How will each business be managed?

2. Competitive contact - Where should the corporate competition take place and be localized?

3. Managing activities and business interrelationships - How will the organization coordinate and share to staff, as well as other external resources?

4. Management practices - What will governing of the business be like?

The business unit level in a BSC for strategic level methodology, the focus is more on sustaining a competitive advantage for the goods and services that the organization wants to render. Aside from positioning against business rivals, the organization should also try to foresee the future. This means that they have to anticipate technological demands and adjust their respective strategies to accommodate them.

The last but not the least is the Functional level aspect of BSC for strategic level planning. This level tackles all about marketing, finance, HR, operations and the company's value chain. All of these involve the coordination of resources in order to execute all the company plans efficiently and effectively. This is also the strategy level that gets incorporated with higher level strategies because it the functional level is the one that provides input into the business unit and corporate level strategy.

Back to our hanging question, what is the role of BSC for strategic level methodologies of organizations? If you will look carefully at those three levels mentioned above, you will notice that it all revolve around the four main aspects of a balanced scorecard: Financial performance, Customer service, Internal processes and Learning and Growth. Hence, the purpose of BSC for strategic level methodologies is emitted through the formulation phase of the business itself.