Third Generation Balanced Scorecards

The balanced score card is a technique used for managing the firms performance across four perspectives;

The original Kaplan Norton balanced score card has undergone several generational changes from the time it was first presented in the late eighties. The Current Balanced Scorecard are sometimes referred to as  ‘Third Generation Scorecards’, as they are known, incorporate the learning from the successes and failures in implementing score cards across the international market place across a wide range of sectors.

Third generation scorecards incorporate a number of additional techniques including the design of Destination Statements for choosing strategic objectives, selecting measures and setting targets along with other techniques from the dot.com industry like strategy Mapping and measuring wealth through overarching measures like EVA  etc.

Key benefits from managing performance using a third generational scorecard are:

1. They translate the firms strategy into measurable parameters;
2. They communicate the strategy to all staff  in the firm and allow them to contribute to the planning and to take ownership of the strategies of the firm;
3. They align the individual goals of employees with the firm's strategic objectives;  third generation scorecards recognise that the selected measures influence the behaviour of employees.
4. Feedback from the scorecard implementation is incorporated into the strategic planning process.