Applying Balanced Scorecard in Non-Government Organizations

Applying Balanced Scorecard in Non-Government Organizations

Marek Ćwiklicki (Cracow University of Economics, Poland)
DOI: 10.4018/978-1-5225-0731-4.ch007
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Abstract

The purpose of this chapter is to present the application of Balanced Scorecard among non-governmental organizations. The limitation to this type of non-profit organizations is justified by their specificity in respect of such institutions as governmental agencies. Notwithstanding the fact that the main narration is subordinated to NGOs the text also contains references to other organizations. The premise of placing these threads is the fact that the literature on this subject, in relation to the use of BSC in non-profit organizations, includes them together. The chapter ends with discussion of basic benefits concerning the application of BSC in non-governmental organizations.
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Specificity Of Strategic Management In Non-Governmental Organizations

Since the 1990s, the strategic management started to appear in the sector of non-governmental organizations. In Great Britain it was estimated that as much as 84% of charity organizations applied or intended to apply methods of strategic planning (Lynas & Ritchie, 1995, p. 274). Changes which took place since those times, including mainly the limitation of time horizon of plans to three years caused concentration on defining priorities and general action plans (Hudson, 2009). In consequence, solutions in the field of strategic management dedicated to the third sector were shaped. Performance measurement was also associated with the strategy which “emphasizes the customer perspective, measures performance against goals and targets, and incorporates measurement systems in other management processes in meaningful ways” (Poister, 2003, p. 9).

For this reason the identification of the specific nature of non-governmental organizations operation gained specific meaning and it determined generation of the solution in the field of strategic management. The key conditions include the environment in which these organizations operate (especially the internal environment) and performance measurement.

Key Terms in this Chapter

Strategy Planning: A determination of major activities within the strategy.

Balanced Scorecard: A strategic planning and management system enhancing performance management.

Performance Management: Measures performance against goals and targets, allowing to assess benefits-costs and services improvement.

Strategic Management: Process by which organizations develop and determine their long-term vision, direction, programs, and performance.

Performance Implementation Measures: The measures referring to the past.

Monitoring: An ongoing mechanism (feedback and learning) which allows an implementation of strategic learning.

Mission Statement: Operational statement focusing on what the institution really tries to do.

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