---
title: "Balanced scorecard for IS"
subject: "Information System"
chapter: 5
key: "semester_8/information_system:bsc-importance-is-implementation"
source: https://www.bctengineer.com/q/semester_8/information_system/bsc-importance-is-implementation
site: BCT Engineering
---

# Balanced scorecard for IS

Information System · Chapter 5: Planning for IS

- Asked in: 2071 Bhadra, 5 marks
- Video: [The Balanced Scorecard Explained with Examples](https://www.youtube.com/watch?v=C0JZdyb6hZE) — EPM
- Answer checked by Claude Opus 5.5 (high effort) on 2026-10-14
- Page: https://www.bctengineer.com/q/semester_8/information_system/bsc-importance-is-implementation
- Whole chapter: https://www.bctengineer.com/md/semester_8/information_system/chapter-5

## Question

What do you understand by balanced score card (BSC) approach? Discuss the importance of BSC for managing IS implementations.

## Short answer

The Balanced Scorecard (BSC) translates strategy into measures across four perspectives: financial, customer, internal process, and learning and growth. For IS implementation, BSC links projects to business goals, tracks non‑financial indicators like user satisfaction and process improvement, provides early warnings, and aids prioritisation and communication.

## Answer

The **Balanced Scorecard (BSC)** is a strategic management approach, by Kaplan and Norton, that translates an organization's vision and strategy into a set of measures in four balanced perspectives. It "balances" financial and non-financial, short-term and long-term, and internal and external measures.

#### The four perspectives
| Perspective | Question | Example measure |
|---|---|---|
| Financial | How do we look to shareholders? | ROI, cost saving |
| Customer | How do customers see us? | Satisfaction, retention |
| Internal process | What must we excel at? | Cycle time, error rate |
| Learning and growth | Can we improve and create value? | Staff skills, training hours |

#### Importance of BSC for managing IS implementation
- **Links IS to strategy:** each project is judged on its contribution to business objectives.
- **Broader than cost and time:** a project may finish on budget yet fail users; BSC also checks user satisfaction and process improvement.
- **Measurable targets:** progress is tracked with indicators such as system uptime, user adoption and response time.
- **Communication:** gives managers, users and developers a common view of goals.
- **Early warning:** poor measures (low training, low satisfaction) show problems before failure.
- **Prioritisation:** helps select and fund the right projects.
- **Continuous improvement:** regular review leads to corrective action and learning.

## Check yourself

The answer's key points as multiple-choice questions, with the correct option and why.

1. What does the Balanced Scorecard 'balance'?
   A. Only debit and credit
   B. Financial and non-financial, short and long-term, internal and external measures
   C. Hardware and software costs only
   D. Staff and managers numbers
   Answer: B. BSC balances financial vs non-financial, short vs long term, and internal vs external measures. (Key point: What BSC balances)

2. Which question belongs to the customer perspective?
   A. How do we look to shareholders?
   B. How do customers see us?
   C. What must we excel at?
   D. Can we improve and create value?
   Answer: B. The customer perspective asks how customers see us. (Key point: Customer perspective)

3. Why is BSC better than only cost and time for IS implementation?
   A. A project may finish on budget yet fail users; BSC also checks user satisfaction and process improvement
   B. Cost and time do not matter
   C. It avoids all measurement
   D. It is cheaper to run
   Answer: A. BSC adds user satisfaction and process measures beyond budget and schedule. (Key point: Beyond cost and time)

4. How does BSC give early warning?
   A. Poor measures such as low training or low satisfaction show problems before failure
   B. It is only checked after go-live
   C. It hides bad results
   D. It replaces testing
   Answer: A. Leading indicators like training and satisfaction reveal problems early. (Key point: Early warning)

## Related in Information System

- [Need of IS and balanced scorecard](https://www.bctengineer.com/question.md?key=semester_8%2Finformation_system%3Awhy-need-is-balanced-scorecard) — Information System, chapter 1
- [Short note: Next generation BSC](https://www.bctengineer.com/question.md?key=semester_8%2Finformation_system%3Ashort-note-next-gen-bsc) — Information System, chapter 5, asked 2×
- [Layered approach to security](https://www.bctengineer.com/question.md?key=semester_8%2Finformation_system%3Alayered-security-throughput) — Information System, chapter 2

## Related in other subjects

- [Balanced scorecard in ICT projects](https://www.bctengineer.com/question.md?key=semester_7%2Fict_project_management%3Abalanced-scorecard) — ICT Project Management, chapter 15
- [Inhibitors of project success and balanced scorecard](https://www.bctengineer.com/question.md?key=semester_7%2Fict_project_management%3Ainhibitors-project-success) — ICT Project Management, chapter 3
- [Japanese approach: JIT and kanban](https://www.bctengineer.com/question.md?key=semester_6%2Findustrial_engineering_and_management%3Ajapanese-approach-jit-kanban-system) — Industrial Engineering and Management, chapter 5
- [Managing three hydropower project risks](https://www.bctengineer.com/question.md?key=semester_7%2Fproject_engineering%3Arisk-manage-three-hydropower-risks) — Project Engineering, chapter 5