Management Accounting 3 Essay Example | Topics and Well Written Essays - 1000 words

Management Accounting 3 - Essay Example Developed by Dr. Robert Kaplan of Harvard Business School and David Norton as a performance measuring framework which could have the capability to take into account the strategic vision and goals of the organization. It is also viewed as value methodology besides being considered cost benefit analysis tool however it is also being labeled as something which can help organizations to change value culture as well as improving operational efficiency and profitability of the organization. (Gumbus and Lussier). The need for developing a balanced score card emerges because though companies are good at developing the glossy mission and vision statements however they fail to develop operational strategies which can help achieve organizations those strategic goals and due to the lack of ability of the organizations to effectively measure whether they are achieving their strategic goals, and targets, organizations found Balanced Score card a very effective tool to measure and monitor their per formance against their strategic goals. Since a balanced score card connect various components of the organizational strategy making such as organizational resources, customers, people, operations, finance and the community also therefore Balanced Score Card is a very comprehensive strategic tool to manage above all. This essay will look into some of the key performance areas which a balanced score card look into and will review their usefulness in achieving the strategic goals within the context of a service organization. Balanced score card have evolved from being a simple performance measuring tool to one of the highly used strategic management tools organization could ever have. It tends to associate the non-financial aspects of the performance with the financial aspects and presents a broader and deeper view of the organizational performance and its relevance to the overall organizational strategy. Rather than being simply used as a performance measurement tool, it