Question

Elucidate how balanced scorecard is useful to management decision making

Answer 1

We live in a chaotic world, and our lives are often governed by Black Swan events, which are impossible to predict, but whose impact can be perfectly explained in hindsight. Minor decisions taken today can have unforseen and disproportionately major consequences in the future. For a manager, this is scary, and the discipline of management has ultimately been all about improving decision making in a data deficient environment.

One way for-profit executives can theoretically make their life simpler is by looking at the decision-making process through a financial prism.