5 Benefits and disadvantages of the balanced scorecard

Balanced scorecard
Balanced scorecard

Benefits of the balanced scorecard

  1. The balanced scorecard offers a long-term view of performance
  2. The balanced scorecard takes into account bot non-financial as well as financial measures into consideration
  3. The monitoring and control of operations is taken into consideration
  4. Businesses that make use of the balanced scorecard can communicate and publicise the goals to all stakeholders
  5. In some cases, a link to the remuneration of management and staff can be created

Disadvantages of the balanced scorecard

  1. There is a potential to manipulate performance measures
  2. The costly bespoke information systems support the balanced scorecard
  3. The conflict or trade-off between the balanced scorecard perspectives
  4. Having too many performance measures in the scorecard can distort the benefits
  5. Historical performance offers no guide to the future