Executive Briefing - Squaring the Public Sector Circle

The Balanced Scorecard was developed for the private sector but has a growing application and following in the public sector.  This briefing paper describes the basics of a Balanced Scorecard in the public sector context and the fundamentals for its successful introduction.  It also discusses the value of the Balanced Scorecard in helping the public sector rise to the challenges they face in the next few years of balancing costs with quality of service.

The Balanced Scorecard was originated by Drs. Robert Kaplan (Harvard Business School) and David Norton as a performance measurement framework that added strategic non-financial performance measures to traditional financial measures, to give managers and executives a more 'balanced' view of organisational performance.

Local government has never had financial performance or profitability as the key driving force for its existence. Even those councils and council leaders who have taken pride in their frugality have also had to deliver essential services to their communities. The pressure on local government to be efficient is always present and will undoubtedly increase with growing demands to cut public expenditure in the wake of the global crisis. Yet local government is still being exhorted by Government to respond to customer demands; improve the customer focus of services, and to work more effectively with their stakeholders for the benefit of their communities.