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Enhancing the effectiveness of the balanced scorecard with scenario planning

Author

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  • Rozhan Othman

Abstract

Purpose - This paper aims to propose the idea of linking the use of the balanced scorecard with scenario planning. Scenario planning emphasizes the development of a strategic plan that is robust across different scenarios. This ensures that the strategy implemented using the balanced scorecard is linked to external conditions and takes into consideration the expected changes in the environment. Design/methodology/approach - This paper examines the criticisms of the balanced scorecard and proposes the use of scenario planning as a way of overcoming some of these limitations. Findings - It argues that the use of scenario planning is capable of overcoming the lack of external orientation in the balanced scorecard. Scenario planning also helps make the balanced scorecard more reflective of changes that may appear in the future. This ensures that the scorecard developed is not merely a linear extension from the present. Research limitations/implications - Studies need to be undertaken to examine whether integrating scenario planning with the balanced scorecard leads to more effective strategy implementation. Practical implications - Adopters of the balanced scorecard need to recognize that developing a balanced scorecard system needs to be preceded by a strategy formulation process that incorporates an understanding of how future events may evolve. This can be achieved using scenario planning. Originality/value - This study is probably the first attempt to link the implementation of the balanced scorecard and scenario planning.

Suggested Citation

  • Rozhan Othman, 2008. "Enhancing the effectiveness of the balanced scorecard with scenario planning," International Journal of Productivity and Performance Management, Emerald Group Publishing Limited, vol. 57(3), pages 259-266, March.
    • Handle: RePEc:eme:ijppmp:v:57:y:2008:i:3:p:259-266
    DOI: 10.1108/17410400810857266
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    Citations

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    Cited by:

    1. Ivo Hristov & Andrea Appolloni & Antonio Chirico, 2022. "The adoption of the key performance indicators to integrate sustainability in the business strategy: A novel five‐dimensional framework," Business Strategy and the Environment, Wiley Blackwell, vol. 31(7), pages 3216-3230, November.
    2. Tobias Hahn & Frank Figge, 2018. "Why Architecture Does Not Matter: On the Fallacy of Sustainability Balanced Scorecards," Journal of Business Ethics, Springer, vol. 150(4), pages 919-935, July.
    3. Nyirenda, Tanang & J. Dzonzi Undi, 2017. "State and outlook of land use and agriculture sector in Machinga district, Malawi," African Journal of Rural Development (AFJRD), AFrican Journal of Rural Development (AFJRD), vol. 1(3), March.
    4. Juan Du & Wenxin Wang & Xinghua Gao & Min Hu & Haili Jiang, 2023. "Sustainable Operations: A Systematic Operational Performance Evaluation Framework for Public–Private Partnership Transportation Infrastructure Projects," Sustainability, MDPI, vol. 15(10), pages 1-26, May.
    5. Shirley Enriquez, 2021. "Institutional Sustainability of St. Paul University Philippines Using the Four Perspectives of the Balanced Scorecard," International Journal of Business and Management, International Institute of Social and Economic Sciences, vol. 9(1), pages 1-33, May.

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