Organizations heading toward 2025 with GPS in hand*
As 2024 comes to a close, it’s time to reflect on the year’s achievements and challenges. However, beyond revisiting the past, this is also the moment to look forward, plan, adjust routes, and set new goals. In the corporate world, where success hinges on assertive strategic decisions, the need for an efficient and reliable tool has never been greater. Enter the Balanced Scorecard (BSC), not just as a methodology but as an accurate GPS for organizational management.
Created by Robert Kaplan and David Norton, the BSC revolutionized how companies interpret and implement their strategies. Why? Because it goes beyond measuring results, it’s a dynamic map that translates an organization’s vision and mission into tangible objectives monitored through indicators organized into four key perspectives: Financial, Customer, Internal Processes, and Learning & Growth. Each perspective provides a detailed view of performance, ensuring that all organizational actions remain fully aligned with long-term strategy.
Bags packed… But where to?
Studies by McKinsey & Company show that 70% of strategies fail during the execution phase – not due to a lack of ideas or ambition but because of the absence of effective tools that bridge planning and action. The BSC solves this problem by ensuring that everyone in the organization, from the ground up, understands their role in fulfilling the strategy, knows the objectives, and is aware of how to achieve them.
Using the metaphor in this article’s title, imagine managing an organization as a journey to a much-desired but often unfamiliar destination. Without a reliable GPS, the risk of getting lost is high. Detours, delays, and missed goals can happen. The BSC serves as a navigation tool for this organizational journey—pointing the destination, recalculating routes, warning of dangers, and adjusting the course based on market conditions and obstacles along the way. Real-time data support all this to enable swift, agile, and seamless decision-making.
Moreover, as the business environment evolves, new technologies like Generative Artificial Intelligence can be integrated into the BSC, making its application even more efficient. Configuring a complete strategic map with well-defined indicators in just minutes – using only natural language interactions—is now possible. This technological transformation enables companies to adapt more quickly to a constantly changing world, making them more agile and prepared for unforeseen challenges.
Organizations that adopt the BSC and embed it into their strategies and operations report tangible benefits, such as improved responsibility definition, greater transparency in results, and increased employee engagement. For managers and leaders, these benefits translate into better performance and greater value for all stakeholders.
Perhaps the greatest strength of the BSC lies in its simplicity. As attributed to Albert Einstein: “If you can’t explain it simply, you don’t understand it well enough.” The BSC transforms the most complex strategies into clear, measurable actions, organizing goals and results in a structured, accessible way for the entire organization. Strategic management transitions from an abstract concept to a clear, comprehensible, collaborative practice that efficiently directs efforts and resources.
So, as you reflect on the challenges and opportunities of 2025 (and beyond), ask yourself: Does your organization know where it wants to go? More importantly, does it have the right tools to get there? Adopting a solid strategic approach supported by methodologies like the BSC could be the difference between steering your organization with a GPS or moving forward blindly, unaware of the opportunities or challenges the future holds around the next corner.
*This article was initially published on Link to Leaders.
Discover the BSC solution here.