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targeted customer, and determining the company’s success (Horngren et al 2009). The aim is to increase customer satisfaction with the company’s products and people as well as to increase satisfaction ‘after the sale’ (Norreklit 2000).

Benefits of implementing balanced scorecard

Recognizing some of the disadvantages and indistinctness of previous management approaches. In order to balance the financial perspective, the balanced scorecard provides a clear recommendation as to what companies should measure. Balanced scorecard is not only a management system, it is also measurement system that allows organizations to illuminate their vision and strategy and then translate them into action. It provides opinion around both the internal and external business outcomes in order to improve strategic performance and results (Balanced Scorecard Basics n.d) According to Kaplan and Norton (1996), they describe the innovation of the balanced scorecard as follows: "The balanced scorecard retains traditional financial measures. But financial measures tell the story of past events, an adequate story for industrial age companies for which investments in long-term capabilities and customer relationships were not critical for success. These financial measures are inadequate, however, for guiding and evaluating the journey that information age companies must make to create future value through investment in customers, suppliers, employees, processes, technology, and innovation”.

Obstacles and key factors of implementing balanced scorecard

The organization adopts too many indicators

The company will lose focal point and wouldn’t be able to find any linkage between indicators. The key factor is to obtain only the indicators that replicate strategy (Kaplan and Norton 2001).

Lack of senior management commitment

The most common reason that causes failure are the allocation of the plan to middle management and defining the plan as performance measurement is expressed by misplacing focus and coalition to implement strategy. Senior management is ought to support and direct in defining the plan as performance measurement (Braam and Nijsen 2004).

The development procedure takes too long

It is better to keep the development procedure short. If the procedure takes too long, it might be due to the changed of strategy during the implementation process resulting in a number of indicators being outmoded and requires new indicators. It is very important to measure with the right indicators to prevent distraction, as measuring wrongly would affect organization’s strategy (Braam and Nijsen 2004).
Too few measures per perspective
Mix of outcomes (lagging indicators) and performance drivers (leading indicators) of the company’s strategy are appropriate to lead to a good balanced scorecard. Consequently, if the companies construct too few measures it would lead to failure in gaining both lagging and leading or non-financial and financial indicators. Thus, it would be better to obtain a balance between both the indicators (Kaplan and Norton 2001)
The metrics are poorly defined
The complexity in recognizing scorecard metrics is multifaceted by the budding requirements of non-owner stakeholders (customers, suppliers, employees, society as well as future generation