MEASUREMENT OF CORPORATE PERFORMANCE THROUGH BALANCED SCORECARD : AN OVERVIEW

Abstract

In the present era of emerging intense global competition, organizations’ are facing increasingly knowledgeable and demanding customers and activist shareholders which have changed the competitive environment from competition based on ability to invest in and manage physical assets to competition based on knowledge and the ability to exploit intangible and soft assets. In this changed business paradigm relying on only the financial measures, which are considered as the indicators of short-run performance, to measure the corporate performance is puzzling and often misleading. A Balanced Scorecard added three additional perspectives covering operating aspects of an organization which exhibits not only the current position of the enterprise but also how it is progressing. But due to some practical difficulties in its development and implementation, the concept developed by Robert S. Kaplan and David P. Norton has not widely accepted and its popularity has not yet peaked.