Balanced Scorecards are essential for every level of the organization to understand how day-to-day activities support overarching goals. This guide explains how to create a balanced scorecard from scratch, offering actionable steps for product managers and strategy consultants.
Balanced Scorecard Definition
A Balanced Scorecard (BSC) is a strategic performance tool that integrates financial and non-financial measures to align daily operations with long-term objectives. By combining four distinct perspectives, it moves beyond traditional financial reporting to offer a comprehensive view of organizational health.
The Four Perspectives Explained
The Balanced Scorecard method divides performance into four perspectives, ensuring balanced attention across financial, customer, process, and learning domains. Each perspective focuses on distinct objectives and metrics.
Perspective | What it Means | Key Measures |
Financial | Are we financially healthy? | Revenue growth, cost management, ROI |
Customer | Are we keeping customers happy and loyal? | Satisfaction scores, retention, share |
Internal Process | Are we running operations smoothly? | Efficiency, quality, cycle time |
Learning & Growth | Are we building future capability to grow? | Training, innovation, culture |
How to Make Balanced Scorecards with Creately
Step 1: Define Vision, Mission, and Strategy
Start by clarifying the company’s direction. Articulate the vision and mission, then translate these aspirations into 3–5 strategic focus areas with clear measures of success. Capture the guiding principles that shape organizational behavior and how the business differentiates itself in the market to ensure alignment with brand identity and culture.
Tip: Open one of Creately’s Balanced Scorecard templates during the leadership strategy session. Use the notes panel or sticky notes to capture vision, mission, themes, and values. This makes it easy to refine, share, and later cascade across divisions and teams.
Step 2: Identify Strategic Objectives
Define 5–8 objectives under each of the four perspectives of the Balanced Scorecard. Apply SMART criteria to make objectives specific, measurable, achievable, relevant, and time-bound, ensuring they are actionable and directly tied to strategy.
Tip: Add objectives into their respective perspective sections in Creately’s BSC template. Use connectors to show how objectives link to Step 1’s themes and influence one another in cause-and-effect order. Share the workspace with relevant stakeholders to gather feedback and secure leadership buy-in.
Advanced Tip: For complex planning, extend your Balanced Scorecard with a strategy map template in Creately. This lets you visually connect objectives, KPIs, and initiatives, showing how Learning & Growth investments lead to process improvements, customer outcomes, and financial performance
Step 3: Select Key Performance Indicators (KPIs)
Choose KPIs that are directly tied to your objectives, backed by reliable data, and meaningful enough to drive decision-making. Define quantitative targets using a mix of benchmarks and stretch goals to inspire performance.
Tip: Place KPIs into the relevant perspective sections of the template. Use color-coding to highlight trends, progress, and performance gaps, making it easy to spot issues and prioritize corrective action.
Step 4: Develop Strategic Initiatives
Develop initiatives that will move KPIs toward their targets. For each initiative, define ownership, timelines, and resources.
Tip: In Creately, assign roles within the Balanced Scorecard, tag team members to initiatives, and centralize all project details in one workspace. Initiative owners can add deadlines, resources, and progress notes. Status updates (e.g., On Track, At Risk, Completed) can be applied directly to objectives, KPIs, or initiatives. These can be color-coded and visible across all linked scorecards.
Advanced Tip: Use Creately’s Impact vs. Effort Matrix to prioritize initiatives, focusing first on those that deliver the greatest value. Link these directly to KPIs for seamless tracking.
Step 5: Cascade the Scorecard Across the Organization
Cascading ensures strategy alignment from the corporate level down to divisions, teams, and individuals. Build scorecard hierarchies (corporate → division → department → individual) so that KPIs and OKRs at each stage contribute directly to higher-level goals.
Tip: Use Creately’s cascading OKR templates so updates at the corporate level flow automatically downstream. This maintains consistency across the organization without duplication.
Step 6: Monitor, Analyze, and Refine
A Balanced Scorecard is a living framework that requires continuous review. Track KPI progress in real time, perform root cause analysis on underperforming metrics, and adjust objectives or KPIs as conditions change.
Tip: Leverage Creately’s dashboards, version history, and collaborative review tools to refine your Balanced Scorecard over time. Capture the rationale for updates directly in the workspace using comments, notes, or linked documents. This keeps strategy transparent, aligned, and adaptable.
Bonus Step: Accelerate with Creately’s AI Balanced Scorecard Template
Building a BSC from scratch can take time, but Creately’s AI Balanced Scorecard template helps you get started instantly. Here’s how it works.
- Input your vision, mission, or strategic themes (e.g., customer excellence, innovation).
- Let Creately AI generate suggested objectives, initiatives and SMART KPIs for each perspective.
- Review and refine with your team directly in the template.
This feature reduces setup time, ensures nothing is missed, and gives teams a ready-to-edit framework that can be refined collaboratively. Instead of starting from a blank canvas, you start from a data-driven draft, making the entire Balanced Scorecard implementation process faster and easier.
Free Balanced Scorecard Templates by Creately
Helpful Resources for Making Balanced Scorecards
Use these professionally designed balanced scorecard templates to get started.
Learn how to master performance management with a Balanced Scorecard.
Find out what our Balanced Scorecard Template can do for you.
FAQs about Drawing Balanced Scorecards
What is the purpose of a Balanced Scorecard?
How many objectives should I include in each perspective?
What’s the difference between leading and lagging indicators?
Do I need a strategy map if I already have a scorecard?
Can Balanced Scorecards be cascaded to teams and individuals?
Resources
Gumbus, Andra. “Introducing the Balanced Scorecard: Creating Metrics to Measure Performance.” Journal of Management Education, vol. 29, no. 4, Aug. 2005, pp. 617–630, https://doi.org/10.1177/1052562905276278.
Llach, Josep, et al. “Creating Value through the Balanced Scorecard: How Does It Work?” Management Decision, vol. 55, no. 10, 20 Nov. 2017, pp. 2181–2199, https://doi.org/10.1108/md-11-2016-0812.
