Your company likely faces three stages while creating a balanced scorecard. First, you must design the scorecard by expression your mission and goals. Second, you must go about collecting the information necessary to build the balanced scorecard. Then, after you have collected the data, you will need to implement the results.

In creating a balanced scorecard for your company, you must first reassess your organization. Companies need to look at their vision and the strategy that they have implemented in order to achieve it. At this time, your senior management team can work together to identify strategic initiatives for the upcoming year and determine the direction in which they want to take the company.

Identifying Performance Measures for Your Balanced Scorecard

Once this has been done, the next step in creating a balanced scorecard is to define performance metrics. This allows your company to develop measures by which you can assess how well you are achieving your objectives. Some of these may be straightforward, such as measuring the change in your profit from year to year. Other initiatives, such as improving customer relationships, may be more difficult to measure and require careful consideration.

In order for a balanced scorecard to be of use to your organization, you will need to prioritize specific initiatives and enact them throughout your company. This will enable you to collect raw data that can then be transformed into information to determine if you are meeting your objectives. The next step is to analyze the results and link them to either individual compensation or company decisions such as resource allocation. It is not enough to decide that your company should be using a balanced scorecard--its worth is only realized if you make provisions to respond to the information gathered and improve performance.