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Introduction
As we embark on the twenty-first century, managers are challenged by sweeping changes in the global arena. Add to these transitions - sweeping economic fluctuations in an economically interdependent world, and the burgeoning use of computers, and a dynamic global business environment emerges. Skilled managers face a complex business environment, full of opportunities but pitted with risks, in which they can make effective business decisions, improve interpersonal relations and meet societal obligations with the right strategy.
This paper focuses on one such strategy known as "The Balanced Scorecard". This paper discusses how to develop a balanced scorecard performance system and explores issues that organizations face in building and implementing scorecard systems, and shares lessons learned from Australian organizations that have taken the balanced scorecard journey.
This approach to strategic evaluation was developed by Kaplan and Norton in the early 1990s, it is claimed that the scorecard with four perspectives- financial, customers, internal business processes, and innovation, learning and growth provides an excellent balanced solution for facing these challenges. The concept of the balanced scorecard enables organizations to achieve an integrated and aligned balanced focus between these four perspectives, which collectively underpin the achievement of the organization's vision.
The process by which a firm's managers evaluate the future prospects of the firm and decides on appropriate strategies to achieve long- term objectives is called strategic planning. Strategic planning is often tempered or changed at some point by a more incremental, sometimes messy, process of strategic decision making by some managers. "When a new CEO is hired, for example he or she will often call for a radical change in strategy. That is why new leaders are very carefully chosen on the basis of what they are expected to do. So while this paper discusses the rational strategic planning process here, because it is the ideal, inclusive method of determining long-term plans, we need to remember that, throughout, there are people making decisions, and their own personal judgment, experiences and motivations will shape the ultimate strategic directions" ([12] Gautreau and Kleiner, 2001).
This paper puts forward a balanced scorecard approach to strategic management via Australian case studies. There are various important key success factors to look at whilst developing a balanced scorecard but the one most...