Question

1. Is there a link between the balanced score card and the SWOT analysis?

2. What is the purpose of the balanced score card?

Answer 1

Yes, there is a link between balance scorecard and SWOT analysis. Balance scorecard is a strategic management and planning tool used to keep track of execution of activities within the organization and external consequences arising from it. SWOT analysis is a study of internal and external factors like strength, weaknesses, opportunities, and threat. Over the years, experts have distinguished between the two but both these complement each other.

The study of SWOT analysis is used to define a goal while balance scorecard is used to come up with a plan to achieve that goal. While SWOT analysis reflects data in a broader sense, balance score simplifies the data using KPI which makes a specific goal look less challenging than before. SWOT analysis is better than brainstorming because it identifies critical success factors and lays down a structural foundation for balance scorecard instead of identifying key performance indicators from the very beginning of strategic planning. The integration of both the methods defines goals and steps to be taken to achieve those goals using organization strategy.

Purpose of Balance Score Card:-

1. Strategy Mapping:- It defines a blueprint of business strategy which controls the internal operations of the company. It is used by the managers to measure and monitor day to day activities of the organization.
2. Balanced Metric:- Balance scorecard is a balance between quantitative factors and factors which cannot be measured. It defines a specific goal which can be achieved and streamline the course of action towards achieving that goal.
3. Organizational Objectives:- It shows a map which managers use to align the efforts of employees and monitor the progress of prioritized projects towards strategic targets.