BALANCED SCORE CARD

Balanced ScoreCard and Six Sigma:

Balanced ScoreCard (BSC) is a framework used by managers to design and implement (Nagel, ME) strategies at the organizational level whereas Six Sigma (SS) is one used to improve the existing processes in order to improve efficiency and reduce error (Jeffery, AB, 2005). The former is used to develop value creation strategies and the latter to improve the use of the resources in implementation of those strategies (Nagel, ME). BSC is a strategic decision making tool whereas SS is related to operational decision making. In spite of these differences both tools are similar in a manner as they:

• Both need inputs from the same set of stakeholders (customers etc) (Killackey H)
• The organizations performance is reflected by the metrics/results obtained from these tools (Killackey H)
• Data required should be adequate as the decisions affect organization as a whole (Killackey H)

Balanced ScoreCard and Benchmarking:

Benchmarking is a process of comparing one’s own results with that of the best so as to assess the level of performance in some context. Balance ScoreCard (BSC) is one of the strategy making frameworks used by the organizations. Benchmarking is done at all the micro levels of the organization whereas the BSC is used at a macro level of the organization in order to get the overview of the business. Benchmarking through Key Performance Indicators is similar to that of BSC while measuring non-numeric values (Balance Scorecard Designer) of qualitative variables.

References:

Nagel, ME, ‘Balanced ScoreCard and Six Sigma: Complementary tools to Advance the Leadership Agenda’, [online] Available at: <http://www.bscol.com/pdf/Final_BSC_Six_Sigma_Article-Nagel_v2.pdf> [Accessed on 9 May 2012]

Jeffery, AB, 2005, ‘Integrating Organization Development and Six Sigma:  Six Sigma as a Process Improvement Intervention in Action Research’, [online] Available at: <http://organized-change-consultancy.wikispaces.com/file/view/intergrating+organizations+six+sigma.PDF> [Accessed on 9 May 2012]

Killackey H, ‘ Seeing Red: Integrating Balanced Scorecard and Six Sigma’. [online] Available at: <http://www.isixsigma.com/methodology/balanced-scorecard/seeing-red-integrating-balanced-scorecard-and-six-sigma/> [Accessed on 9 May 2012]

Balance Scorecard Designer, Balanced Scorecard and KPI, performance-based management and benchmarking’, [online] Available at: <http://www.strategy2act.com/solutions/performance-benchmarking.htm> [Accessed on 9 May 2012]

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