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The balanced scorecard: Subjects, concept and objects - A

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Article  in  Journal of Accounting & Organizational Change · October 2012

DOI: 10.1108/18325911211273509

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BSC: subjects,
The balanced scorecard: subjects, concept and
concept and objects – a objects
commentary
511
Niels Dechow
Department of Finance, Accounting & Real Estate, European Business School,
Wiesbaden, Germany

Abstract
Purpose – By observations of what managers do with the balanced scorecard (BSC), the purpose of
the paper is to discuss how further empirical research may be advanced, which differentiates more
clearly what we study when exploring BSC work.
Design/methodology/approach – The paper is based on a discussion of observations of seasoned
managers working with the BSC as part of their executive education program. It offers a discussion of
how insights from interaction with these managers can develop our understanding of how
management concepts are constituted and can be explored.
Findings – The ways in which managers (dis-)connect the BSC objects and concept are everything
but benign. Much more could be known about the BSC, by studying both how these relationships are
crafted in practice, and how the relationships crafted are influenced by the texts by which the BSC is
known.
Research limitations/implications – The paper offers a new way of framing research of popular
management conceptualizations, by separating them in terms of conceptual ideas and representational
objects. It offers a starting point for researching, what managers do with the BSC, and for researching
what it is that works for the balanced scorecard.
Originality/value – The paper frames a quadrant approach. It distinguishes the BSC in terms of its
conceptual narrative, its artefact object representation, users’ conceptual expectations and object
mobilization. These four dimensions can assist researchers in finding ways to assess the impact of
popular management concepts.
Keywords Balanced scorecard, Control systems, Performance management,
Management control systems, Performance measurement
Paper type Research paper

Introduction
This commentary observes that managers talking about and working with the
balanced scorecard (BSC) often fail to translate and embed its conceptual ideas into the
objects – or performance measurement/management systems – by which they work.
Curiously, the (missing) relationship between the balanced scorecard concept and its
visualizations (objects) has never been granted much attention in research and practice.
In consequence, we may not know as much about the balanced scorecards, as we
probably would like to believe. In particular, there are three questions that remain to be
explored in further detail:
(1) How managers work with the balanced scorecard? Journal of Accounting &
Organizational Change
(2) What is it that works for the balanced scorecard? Vol. 8 No. 4, 2012
pp. 511-527
(3) What measure of impact that answers to these questions suggest in q Emerald Group Publishing Limited
1832-5912
combination? DOI 10.1108/18325911211273509
JAOC I draw attention to these questions with point of departure in observations I have made
8,4 in executive education, of managers working with the balanced scorecard. Across a
variety of Anglo-Saxon, Germanic and Scandinavian business school environments,
I have noted that managers often work with the balanced scorecard objects in ways
that contrast the conceptual ideas introduced by Kaplan and Norton (1992, 1996, 2001,
2004, 2006, 2008). Specifically, I have made five observations, which suggest to me that
512 managers often (dis-) connect the balanced scorecard concept and its objects in curious
ways. They hear one, see one and say one (Pfeffer and Sutton, 1999), and in so doing
often produce the opposite of, what the balanced scorecard claims to be all about. This
is paradoxical, in particular because Kaplan and Norton (1996) already early on
promised that the balanced scorecard would help managers turn “strategy into action”:
(1) Managers typically reproduce BSC visuals (objects) in line with Kaplan and
Norton’s texts. But, they do not consider what it takes to broaden and anchor
performance management beyond desired/required financial objects.
(2) Often the BSC concept is introduced by managers in order to address
organizational concerns of strategic importance. Nevertheless, they fail to
address the wider frame for performance management, including important
priorities, necessary trade-offs, etc.
(3) Regularly the BSC objects are filled out with generic key performance indicators
(KPIs), as if these carried generic relevance independently of the specific work
context. Managers do not bother to bend the BSC to local circumstances, by
addressing particular areas of attention, for example.
(4) When the BSC is adopted, managers emphasize proactiveness, personal
leadership and project management as important success factors. In comparison,
they do not engage much with the task of making the BSC and the wider idea of
performance management a matter of organizational development.
(5) Managers adopt the BSCs differentiation between objectives, measures,
initiatives and targets as categories that help organize and structure their choice
of performance measurements. But they fail to use these categories as a means
by which to conduct iterative planning and control processes between upper
and middle management.

In effect, it seems to me that live or local balanced scorecards often provide only an
overview of important accounts and responsibilities. In comparison, they fail to give a
clear outline of the ways that employees can contribute/create and do right/achieve
(Simons, 1995). When confronting executives with these five observations, it has
surprised me both how frequently and openly they would acknowledge what I saw,
and yet at the same time observe that their behaviour patterns “pretty much” reflected
how they in their organizations worked with the balanced scorecard. In my
understanding this suggests that managers on the one hand appreciate the BSC for its
appeal, yet on the other hand do not understand, what it takes to make performance
management work the BSC way. To them, the visuals (objects) representing Kaplan
and Norton’s BSC concept seem to equal the concept to an extent that their using of
objects (visuals) equals using the concept.
As mentioned, the five observations I have made are based on teaching/training of
managers – participants in executive education. They point to a variety of
“side-effects” that result, when managers start working with the BSC on their own, and BSC: subjects,
moreover that these unintended consequences may result because managers do not concept and
know or bother to consider, what it takes to make BSC visuals (objects) representative
of the conceptual idea(ls) introduced by Kaplan and Norton over the course of almost objects
20 years. So far, most of these effects remain unaccounted for in extant BSC research.
The claim I present and defend in this commentary is that the relationships established
between the concept and the objects by managers are everything but benign, and that 513
it is time to study not only, how these relationships are crafted in practice, but also how
the relationships crafted are influenced by conceptual ideas and objects constituting
the texts by which Kaplan and Norton (1992, 1996, 2001, 2004, 2006, 2008) describe the
balanced scorecard.
In the following second section, I introduce to the teaching/training context in which
my observations have emerged. In the third section, I elaborate on the observations
already introduced briefly and relate them individually to observations in current and
past research. The fourth section mirrors these observations against a brief recalling of
Kaplan and Norton’s literature (1992, 1996, 2001, 2004, 2006, 2008), and asks the
questions if perhaps there is something about this literature that deserves additional
research attention. In the fifth section I address that past research – with few notable
exceptions – have hardly engaged with the texts by Kaplan and Norton, and rarely if
ever engaged with the balanced scorecard as a concept-object relationship. My claim is
that doing so, would allow us better to explore how the balanced scorecard works, and
if it works (in practice).

Separating the BSC concept from its objects in order to observe managers
in action
The five observations introduced already have resulted in the context of working with
executives via a Harvard Business School case addressing the dilemmas of crafting
alignment between business strategy and organizational responsibility structures. The
case concerns a service firm, having organized itself in several profit centres and one
“break-even” centre. In principle, most of the challenges experienced by this
organization could be solved by a simple responsibility centre redesign involving new
cost allocation principles, one shared services cost centre and several individual profit
centres. In order to get to this solution, however, case participants need first to engage
with the firm’s business model – how money is made – and then discuss strategy,
including ways of possibly fitting structure to the business model. Structure follows
strategy (Chandler, 1962) – the case is a typical Harvard Business School product
(Zeff, 2008).
Over the years, I have worked with the case in a variety of ways. Course participants
would be advised to read and work with the case ahead of the lecture. At times,
participants would prepare themselves only on an individual basis, knowing that it was
expected that they would understand the case to a point, where they could be
“cold-called” in class. Usually, however, preparation work has involved group-based
discussions prior to class and the production and class distribution of two-page
executive summaries on the observed situation “as-is” and the solution to “to be”. On a
general level, this is worthwhile in executive teaching environments, where participants
already bring in relevant knowledge and experience. Moreover, preparation in teams
usually serves that participants subsequently understand and debate better the
JAOC inter-relatedness of problems and symptoms around which business cases are often
8,4 structured. Specifically, however, this practice has been relevant for my teaching and
training purposes, because I wanted participants to make a record of the problems and
solutions they saw, to which I could return later in context of the performance
management systems that I would ask them to produce.
In class, the case has always been used for a 3 hour long session, covering case
514 relevant discussions of different types of responsibility structures and
pricing-costing-incentives relationships in service firms. Classes do not necessarily
end with one solution, but always with a summary of all relevant problems, challenges
and issues and the different ways that these could be approached. When using
group-based preparations for class, participants would return to their groups after class
in order to reflect and submit brief reports on their learning outcomes, in particular with
regards to the ways that discussions followed or contrasted their prior case
understanding. At the end of class, participants have always been informed that the
following class would involve the development of a performance management system
addressing the problems discussed and clarified in class. Explicitly, I have never asked
anyone to design a balanced scorecard – “just” a performance management system.
However, ending the classs, I have always introduced the performance management
agenda by the following statement:
Organisations should not search for the perfect structure for their strategy. Instead, they
should choose a structure that is reasonable [. . .] and then design a customized, cascading
system of linked Strategy Maps and balanced scorecards to tune the structure – the
corporation and its collection of centralized functions and decentralized product groups and
geographical units – to the strategy (Kaplan and Norton, 2006, p. 38).
My subsequent class has then started by a formal introduction to the balanced
scorecard. By choice, I do not introduce the concept by its visuals such as the “strategy
map” and the icon displaying four boxes connected by lines and arrows. Instead,
I introduce the BSC by its conceptual thoughts, only. This choice is deliberate. First,
I want participants to focus their attention on the principal thoughts of the BSC
concept – independently of graphical representations. Second, I want to explore with
participants, how they mobilize these ideas by turning them into performance
management systems (for the case discussed, previously). My introduction to the
conceptual idea of the BSC takes point of departure in four points that I conclude by
the call for performance management systems that responds to the challenges and
problems in the case, which participants by then will have discussed both in groups
and in their previous class.
First, I introduce that the concept takes point of departure in iterative processes
structured around objectives, measures, targets and initiatives. The point is made that
Kaplan and Norton by these individual categories have created a vocabulary, by which
top management can define the objects, ask middle management for appropriate
measures, set targets and then leave it to the organization to figure out appropriate
initiatives. Obvious parallels to iterative top-down and bottom-up budgeting
procedures is discussed in context of this point, yet at the same time it is addressed
that Kaplan and Norton (1996, p. 164) state very specifically that “the balanced
scorecard is not a replacement for an organization’s day-to-day measurement system”.
It depends on a process of translation – from objectives, over (strategic) measures,
to targets and initiatives.
 The notion of strategic measures refers to the conceptual idea that there for any BSC: subjects,
given situation can be found a critical path of actions, as for example developed by concept and
Kaplan and Norton (2001, 2004) in terms of their “strategy maps”. In their texts, the
distinction between strategic and diagnostic measures, is not always immediately objects
clear. It is easy to find examples, where references is made to traditional performance
measurements – for example, when Kaplan and Norton (1996, p. 307) write: “certain
core outcome measures appear repeatedly on scorecards” – such as “revenue 515
growth/mix”, for example. In parallel, however, Kaplan and Norton (2001, p. 77) also
emphasize that organisations must define objectives, (strategic) measures, targets and
initiatives in order to craft hypothetical – not statistical – cause-effect relationships,
which then subsequently is turned into so-called leading and lagging performance
measurements. For this particular purpose Bukh and Malmi (2005) offer a worthwhile
reading – a re-examination of Kaplan and Norton’s cause-effect principle.
Second, I provide an overview of the key prescriptions by Kaplan and Norton
(1992-2006), as listed in the table. I use the table to emphasize, how the concept in the
text by Kaplan and Norton has changed properties over the years, by turning focus
from purpose to the processes of doing BSC work. The table illustrates the steps in
balanced scorecard work, by which Kaplan and Norton structured their book
manuscripts (1996-2008). Whereas in 1992, they asked four reflective questions, their
subsequent manuscripts turned focus towards the processes of implementing the
balanced scorecard. Moreover, the comparative illustration of “necessary steps” is
illustrative of the ways in which the balanced scorecard has increasingly been
positioned (Kaplan and Norton, 2006, p. 260-1) as a parallel to Deming’s (1986)
plan-do-check-act quality management approach.
Third, I address the difference between leading and lagging measurements (Kaplan
and Norton, 1996) and the point of operating with both. In context hereof, I introduce
research (Ittner and Larcker, 1998; Ittner et al., 2003a, b) pointing out, how difficult it is to
get the combinations of leading and lagging measures right, from a statistic point of
view. I use this point – partly in contrast to Ittner and Larcker, to reiterate once more
how Kaplan and Norton in their manuscripts emphasize that it – in their view – is better
to work with qualitative measures that create commitment and alignment than it is to
settle on quantitative measurements, which make no difference vis-à-vis the status quo.
Fourth, I introduce by means of selected Harvard Business Review articles the idea
of an “Office of Strategy Management”. I do so in order to illustrate to my course
participants that Kaplan and Norton envision the concept to be institutionalized in
organizational practice, in ways that remain distinct from day-to-day planning and
control processes. Moreover, this point creates a good working basis for asking
experienced managers about their practices, their experiences, including for example,
whether they work with performance management as a strategic, ongoing
improvement project – something that according to Kaplan and Norton is important.
By my introduction of these four conceptual arguments, I deliberately try to
generalize what we can learn from the balanced scorecard, all while I as deliberately
avoid using any of the visuals, by which Kaplan and Norton have visualized and
motivated their concept. Finally, I then re-introduce the assignment mentioned at
the very end of the previous case-based lectures. Here, I ask course participants to
design – in groups – a performance management system that addressed the issues,
previously identified in class and draft performance management solutions that can
JAOC help align strategy and structure. By explicit choice, the assignment does not make
8,4 reference to the balanced scorecard, but leaves it open to the participants – all
seasoned managers – to make their choices with regards to the actual design.
Framing the assignment this way, I challenge participants to imagine and choose the
objects by which they want to introduce performance management (systems), and to
figure out, how to translate (their) strategy (from the previous class) into performance
516 management based action. This approach allows me to study and interact with the
things that managers – in a teaching context – do intuitively with the conceptual ideas
of the balanced scorecard. By no means does this approach constitute a formal
experiment. I have not worked with control groups, although I have assigned course
participants to several different reporting formats ranging from formally assigned
written reports to informal class presentations. I have allowed different groups of course
participants to prepare themselves for longer and shorter periods of time, with two
weeks as a maximum and one day as a minimum. But again, my observations are
developed in the course of teaching, training and coaching managers trying themselves
out with performance management. It is with point of departure in their
trial-and-learning processes that five observations have reproduced themselves
independently of where in the world I was working with experienced managers[1]. This
latter aspect I find curious and worth-while reporting, because it could suggest that there
is something generic about the processes of translating strategic concepts into
management practice that may deserve formal research attention. In particular my five
observations suggest that the balanced scorecard visuals could be far more influential in
the ways that managers work with the balanced scorecard concept, than most of us
would have expected.

How do managers work with the balanced scorecard?

Over the years, I have allocated shorter and longer periods of time to course
participants for their development – in teams – of performance management systems
in relation to the case organization discussed in a prior lecture. With very few
exceptions, most teams have always returned to the following class with a balanced
scorecard to represent their performance management solution. In principle this is not
surprising as, after all, their teamwork followed a class on the conceptual foundations
of the BSC. Importantly, it is not their choice of the balanced scorecard that led to my
five observations. It is what they did and did not do with the BSC objects in relation to
the BSC concept that I have been – and continue to be – curious about. In sum, my five
observation suggest that the BSC visuals (objects) appear to be highly influential in the
ways that managers go about working with the BSC concept.
In my classes, managers often use the BSC graphic and the four supporting questions
to frame for their fellow course participants their work with the concept. On several
occasions I asked into why this procedure was chosen – given that everyone in the class
room for sure knew the concept. I have been surprised by the frequency by which
managers have relayed back that they reiterated these questions, because they liked,
how the concept framed the task in front of them. To my even bigger surprise, it was only
rarely nevertheless that these managers would work themselves, for example, from the
learning and growth perspective via operations and customers to a finance perspective.
I have observed that course participants – seasoned managers appear to like the
concepts narrative, yet typically take point of departure in the financial results they
want and/or are expected to deliver, when talking about performance management. In BSC: subjects,
line with herewith, they would anchor all categories of performance measurements to concept and
desirable/expected percentage improvements, rather than to think about performance
management as a development and process tool. To an extent, this observation parallels, objects
a research-based observation suggesting that evaluators using a BSC format place more
weight on financial category measures than non-users, when performance differences
show up in the BSCs financial category (Cardinaels and van veen-Dirks, 2010). 517
Second, I have observed often that BSC designs are introduced and motivated by the
intention to develop a focus on business strategy but nevertheless that the designs
introduced accounted in no particular way for strategic priorities, trade-offs and/or, for
example, the responsibility structures already designed. Rather than using the BSC to
“tune structure to strategy” (Kaplan and Norton, 2006, p. 38), executives often appear to
position “strategic concerns” simply as rhetoric, by which they justified their demands
for everyone to offer more on all accounts. So far, I have never yet experienced executives
who in their design of their BSC spent much time on drawing out the boundaries between
do’s and don’ts and expressing what they, respectively, wanted more and less of.
Moreover, most teams presenting their work did not account for the difference between
what the BSC object communicated to others, and what it communicated to themselves.
When asking into their choices of measures and measurements, other course
participants would often be surprised to learn, how intensively various aspects of the
organizational struggles had been discussed and considered. Mostly, the strategy maps
and BSC objects presented appeared as “filled out” templates, which did not make any
contribution to the case that everyone had discussed in a previous class.
Empirical research by Hansen and Mouritsen (2005) and Qu and Cooper
(2011) reports, how respondents openly acknowledged that their versions of the BSC,
did only to a limited extent resemble “balanced scorecard” theory. The observation is
interesting – in particular because it was made by respondents themselves. Like
participants in my courses, these respondents acknowledge a difference between the
BSC concept and its objects. Whether this is just because that their scorecards look
different, or whether there are other reasons that motivate this observation, we do not
know. Respectively, the authors of these studies do not elaborate on these of their
respondents remarks. Nevertheless, their statements resonate with the observation
made in my classes. What people make of the balanced scorecard when using its objects
often limits what they effectively say about their thoughts regarding the design of
performance management systems. To my knowledge, it remains unexplored, how the
objects representing the BSC influence users’ appropriation of the BSCs conceptual idea.
Third, participating executives would often develop and present balanced scorecard
designs that in the end appeared more generic rather than specific. Often, presenters
assumed that their performance management designs would speak for themselves via the
leading and lagging measurements defined. Usually the intended mobilisations remained
tacit and implicit to such an extent that other managers attending the audience faced great
difficulty in relaying the specific intentions of the performance management systems just
introduced. The observation resonates with previous research showing how BSC systems
struggle in practice because they hardly reflect the organizations in which they had been
implemented (Kasurinen, 2002; Wickramasinghe et al., 2007; Andon et al., 2007;
Kasperskaya, 2008; Modell, 2009). Moreover, I have witnessed on several occasions, how
these generic performance management design provoked boredom and/or frustration
JAOC among the audience, whenever it remained unclear, as to what extent and in what ways a
8,4 presentation responded to the specific problems and challenges in the business case that
all participants had spent considerable time preparing, discussing and analyzing, prior to
their assignment to design performance management (systems).
Fourth, executives talking about their performance management systems using the
balanced scorecard have often devoted a disproportionate amount of time to talk about
518 the ways that they envisioned the roll-out and management of the project. In
comparison, they then talked much less about ways of developing performance
management as an organizational practice. Whereas the latter requires reflection on the
input and disruptions that might be necessary to alter organizational practices and
routines, a focus on project management requires little specific involvement with the
context – other than a presentation that emphasizes, how the speaker commits his or
her own leadership to making things work. In my view, managers – by their project
management focused presentations, often allude to a surprisingly narrow sense of role,
duty and responsibility, which made me wonder about the hopes/expectations, in the
balanced scorecards? In comparison to my observation, others have found that
inscriptions produced in a BSC project easily crumble, once a project is to be turned
into a practice (Aranda and Arellano, 2010; Qu and Cooper, 2011).
Fifth and finally, executives often chose to replace the possibility of an iterative
process between management and the organization with a top-down process, revolving
around their own thinking of challenges and solutions. Participating managers have,
on a regular basis, expressed confidently that they know better than subordinates in
their own organisation, what strategic measures, initiatives and targets that would
respond to various objectives in a given situation. Nevertheless, KPIs were often
chosen mainly because participating managers knew already, how to get to their
data-basis. Aspects of this relationship have been explored formally by Northcott and
Smith (2011). Executive participants in my courses would often introduce KPIs, as if
they carried generic meaning and relevance independently of the specific work context.
Recent empirical studies resonate with this observation (Carmona and Grönlund, 2003;
Chang, 2006; Lawrence and Sharma, 2002). They suggest that managers may even
define as strategically relevant, whatever they are able to measure. More research is
needed, however, to explore if this suggest that managers eliminate performance
management processes, once they are able to substitute them with measurements, they
know and can easily fill into the BSC templates within which they choose to work?
This observation concern itself with the ways that users mobilise objects on their own.
Again it is important for me to emphasize that my observations result from
processes of working with managers in situ of executive education, not from a formal
experiment. Rather than to define and control the variables administered, I have
observed and discussed with managers in action, what they did in order to translate a
concept into an object. A teaching environment is clinical, but it is not formal in the
way that one would develop it for the purposes of quasi-experimentation (Cook and
Campbell, 1979). Regardless, I offer that there is a lot to learn from such teaching
because the ways managers work in an executive training context is often intuitive,
experience-based and therefore surprisingly reality conform.
In sum, my observations suggest that in practical use, managers story-telling by
means of the balanced scorecard of financial reasons, a customer value plot,
operational risks and hopes attached to learning and growth often remains so weak
that it is impossible to decipher by which hypothetical cause-effect relationships they BSC: subjects,
attempt running their firms. Stated differently, once managers translate from a concept and
conceptual idea to an object, it seems that many of the initial ideas motivating the
balanced scorecard are lost by the practitioners, who in working to develop a novel objects
performance management approach think that they reap the benefits promised by the
concept – “in theory”. Given the sum of these observations, I have frequently returned
to the texts by Kaplan and Norton in order to re-study, how they associate their 519
conceptual thoughts with visual objects? Indeed, previous text-focused studies exist,
but they can offer only limited help in relation to this question, as they focus notably on
the (missing) logics and virtues of Kaplan and Norton’s text (Noerreklit, 2002, 2003).

What is it that works for the balanced scorecard?

Some have suggested that Kaplan and Norton mainly use images to make the balanced
scorecard appear as an outcome of evolving scientific research (Free and Qu, 2011). In
comparison, my observations frame the question that these images may not be
“innocent”. They make the balanced scorecard concept desirable by offering
object-forms that are easily reproducible. However, per se the objects do not carry-over
to readers and users, the four conceptual ideas, which as introduced above, make the
balanced scorecard distinct. Kaplan and Norton (2006, pp. 206-1), represent this
concept-object relationship somewhat differently. In their view, the effectiveness – or
success – of the balanced scorecard:
[. . .] is derived from two simple capabilities: (1) the ability to clearly describe strategy
(the contribution of Strategy Maps) and (2) the ability to link strategy to the management
system (the contribution of Balanced Scorecards) [. . .]. The net result is the ability to align all
units, processes, and systems of an organization to its strategy [. . .]. The approach adds
several important features to the classic “plan-do-check-act” closed loop, goal-seeking process
introduced by Deming in the quality movement [. . .]
Read literally, objects do quite a lot for the BSC concept. According to Kaplan and
Norton, the “strategy map” describes strategy; the “BSC icon” links strategy to the
management system; in combination both objects help align all organizational units to
strategy; and last but not least they place Kaplan and Norton in management history,
by appending the balanced scorecard to Deming’s quality management approach. It is
an impressive relationship and promise that it presented here. It may not convince all
of us (Noerreklit, 2000, 2003; Noerreklit and Mitchell, 2007), but it somehow works for
the balanced scorecard as a publication enterprise. Kaplan and Norton suggest to
readers that objects help users appropriate conceptual management ideas, when used
appropriately. Whatever that means, is a different question, of coruse.
Throughout their manuscripts, Kaplan and Norton help this relationships along by
a battery of metaphors. Initially, Kaplan and Norton (1992) likened the BSC to a
“dashboard” of metrics”. By this image readers/users were positioned first as “cabin
crews” (1992) and later as “architects” (1996), and then the dashboard was replaced with
the image of a “flight-simulator”. Subsequently, Kaplan and Norton (2001) reframed the
balanced scorecard as a tool for change management projects by likening it to a “burning
platform”. In line with this new image, readers/users were positioned as “change
agents”. Then, by 2004 Kaplan and Norton likened the act of strategy mapping to
the planning of war-campaigns, and henceforth readers/users were told to imagine
themselves as “von Clausewitz” (a war strategist). Finally with the introduction
JAOC of the staff function called an “office of strategy management”, readers/users were told to
8,4 imagine themselves as “coxswains” (2006). The metaphors chosen carry forward the
objects, themselves carrying forward the concept. In comparison, what the objects and
metaphors do not carry forward is input on the actual work that organizational
performance management entails. In fact, Kaplan and Norton (2006, p. 267) even
comment critically that:
520 We often are asked how to weigh the measures in a Balanced Scorecard. Such a question may
be a sign that the organization does not truly understand the Balanced Scorecard
management system [. . .] Organizations select weights based on the nature of their business
and their short-term priorities [. . .] Thus, although measures may stay relatively consistent
from year to year, the relative weights applied to those measures in the annual compensation
plan can vary based on short-term priorities.
By the warning that organizations may not truly understand the balanced scorecard –
if they entertain considering practical questions, Kaplan and Norton avoided making
the associations of concept and objects (and metaphors) operational and hands-on.
In lieu of pragmatic advice, they offered series and series of linear steps to be taken,
actions to initiate and tasks to execute – as also summarized by Table I. They frame
managers in ways that work both visually (Free and Qu, 2011) and heuristically (as an
instruction). Nevertheless, I have never seen anyone actually claiming that they
followed these steps in any particular way. In may experience, these instructions work
mainly as a “lingo” – or type of rhetoric, which managers quickly adopt as a means
to bridge their knowledge-doing gap (Pfeffer and Sutton, 1999) by the “hear one,
see one, say one” principle. Unfortunately, my observations also suggest that
managers in so doing all to easily compromise, what the BSC concept was intended to
be all about.
Stated differently, by itself it may bee trivial to observe that BSC objects in Kaplan
and Norton’s texts are positioned to stand-in for the BSC concept. In context, however,
the BSC’s concept-object relationships appear as anything but trivial, when observing
what managers actually do with the BSC objects – having only been introduced to
the BSC concept. They appear to civilize a mode of thought and action (Dechow, 2006),
which may in fact promulgate the problems that the BSC concept promised to
solve, rather than to help mitigate them. This is what my five teaching-based
observations suggest. Even if they are not generalizable in a research-based sense, they
suggest that there is much to research in relation the balanced scorecard, because we so
far have not really differentiated the balanced scorecard in terms of its conceptual
ideas, its objects, and their interaction in text and practice. Moreover, by explaining
tentatively, observed managerial actions with point of departure in Kaplan and
Norton’s (1992, 1996, 2001, 2004, 2006, 2008) text-based associations of concept and
objects, this commentary draws up that there seems to be an intriguing quadrant
relationship that awaits exploration between Kaplan and Norton’s conceptual
narrative, their artefact object representations, user-subjects expectations vis-à-vis the
concept and their mobilization of the object. Knowing these relationships in
combination is important in order to understand the balanced scorecards measure of
impact (Figure 1).
Also exploring exclusively the balanced scorecard in terms of its textual
concept-object relationships seems important, because such research could provide us
with a better understanding both of, what it is that works for the concept; and whether,
 BSC: subjects,
2001
1992 1996 The strategy- 2008 concept and
The balanced The balanced focused 2004 2006 The execution objects
scorecard scorecard organization Strategy maps Alignment premium

1. How do 1. Define the 1. Translate the 1. Define 1. Check 1. Develop the

customers measurement strategy to shareholder/ enterprise strategy 521
see us? architecture Operational stakeholder value
Terms gap proposition
2. What must 2. Build 2. Align the 2. Reconcile 2. Check 2. Plan the
we excel at? consensus organization customer corporate strategy
around to strategy value office/corp.
strategic proposition support units
measures
3. Can we 3. Select and 3. Make 3. Establish the 3. Check board 3. Align the
continue to design strategy time line for and organization
improve and measures everyone‘s sustained shareholder
create value everyday job results alignment
4. How do we 4. Build the 4. Make 4. Identify 4. Check 4. Plan
look to implementation strategy a strategic corporate operations
shareholders plan continual themes office/business
process (critical few units
processes
5. Mobilize 5. Identify and 5. Check business 5. Monitor and
change align units/support learn
through exec intangible units
leadership assets
6. Identify and 6. Check business 6. Test and
fund units/ adapt
strategic customers
initiatives to
execute
strategy
7. Check business
support units/
suppliers & ext Table I.
partners A compilation of BSC
8. Check prescriptions introduced
corporate by Kaplan and Norton
support (1992-2008)

to what extent, and how this relationship challenges the ways performance management
is understood and approached in practice? Equally, exploring practitioners handling of
these concept-object relationships could be important, more generally, in order to
understand actual mobilisations of what others have classified only as “fad and fashion”
(Abrahamson, 1991; Armstrong, 2002; Ax and Bjoernestad et al., 2005). Already, a wealth
of valuable insights has been produced in relation to the balanced scorecard. However,
research is needed that explores and compares specifically, what practitioners expect
of a concept, and how they make use of its objects, when creating management
accounting practices.
JAOC Artefact Object Representation
8,4

User's Object Mobilization

522

Conceptual Narrative Balanced Scorecard

Impact

Figure 1.
Interacting dimensions
of impact
User's Conceptual Expectation

How does the academy work with the balanced scorecard?

20 years into the life-cycle of the balanced scorecard, one might like to assume that we
have moved beyond the beginnings, where initial coordinates were set by comparisons
of the BSC to other known concepts such as the Tableau du Bord (Bessire and Baker,
2005), and by discussions of the balanced scorecards ideology and cultural identity
(Bourguignon et al., 2004). The claim has been made that the BSC lacks a valid
theoretical logical underpinning (Noerreklit, 2000, 2003). Regardless, we see that the
balanced scorecard has been around “as new” for a very long time now, and actually
longer than any other management concept known to date. More importantly, we now
begin to see research that draws on notions, which the balanced scorecard literature
has introduced, yet perhaps never really explained.
Mundy (2009, p. 17), for example, presents the argument that “balance presents a
complex challenge for organisations [. . .]” But what does this challenge entail? In practice,
do corporations really want to balance their performance measurements, or do they
simply use new language to refer to their use of multi-dimensional performance
measurements? Also there are those, who have started experimenting with methods that
help managers to produce the type of cause-effect focus on performance measurements for
which Kaplan and Norton (1996) search (Taylor, 2010). But is it clear, that practitioners
would ever (want to) produce these relationships in practice? So far, we only think
so, because Kaplan and Norton tell us that this is something they have seen practiced,
already.
Curiously, extant research does not appear to have made similar observations.
A number of studies far greater than referenced below have explored the purposes, for
which managers use balanced scorecards. For example, they suggest that BSCs in
practice represent little more than new information systems. They compile a set of
strategically relevant information and present these in a form that helps managers
to focus (Malmi, 2001, p. 216). Usually, these do not qualify as strategic BSC: subjects,
management systems (Speckbacher et al., 2003). Managers mainly use their BSCs for concept and
decision-rationalization, coordination and self-monitoring purposes (Wiersma, 2009).
Empirical studies have indicated that managers rely more on common than on unique objects
measures (Lipe and Salterio, 2002); and that corporations using a balanced scorecard
generally exhibit few differences in their emphasis on non-financial performance
categories from non-users of balanced scorecards (Ittner et al., 2003b). It has been 523
suggested that performance evaluations – under certain conditions – are affected by the
ways of organizing measurements into the various BSC categories (Lipe and Salterio,
2002) and also that evaluators using a BSC format place more weight on financial
category measures than non-users, when performance differences show up in the BSCs
financial category (Cardinaels and van Veen-Dirks, 2010). Reflecting on similar
observations, some have wondered if a problem in practice is that interaction with
objects must be invented in order to matter, and that managers first have to learn to
construct and negotiate the idea of performance measurement links in order for them to
mean anything (Banker et al., 2004). Others have chosen to simply liken the balanced
scorecard to an empty frame, which can be used for any conceivable type of focus
(Hansen and Mouritsen, 2005). Findings like these do not suggest that managers today –
20 years after the introduction of the balanced scorecard – choose performance
measurements according to hypothetical cause-effect relationships and evaluate these in
balanced ways. In sum, they suggest that performance management remains as
underdeveloped a practice as it did 20 years ago, when Kaplan and Norton (1992) first
introduced the balanced scorecard.
Yet, again, how well have we in our studies specified what balanced scorecard
work entails? Have we differentiated users’ conceptual expectations from their
understanding of the concepts and use of particular objects, or have we perhaps
sometimes conflated certain things by studying the balanced scorecard only in terms of
the visuals and objects, by which other people thought they had developed
performance management systems? By no means do I intend to discredit past research
outcomes. Across a variety of research approaches, findings suggest that the balanced
scorecard in many firms and to many managers has simply become a label for various
types of performance measurement practices. Because of the research undertaken, we
know that performance management remains far less common than one would
have thought – given the host of modern management conceptualizations that
surround us.
Nevertheless, past and present findings do not allow us to say much about the impact
of the balanced scorecard. We may know, intuitively at least, whether the balanced
scorecard works, or not. But, our research-basis for stating such claim remains slim. My
teaching-based observations suggest that the balanced scorecard – when practiced
simply as an object or template – may in fact promulgate exactly those problems, it was
designed to mitigate. Moreover, I have raised the point that these observations do not
surprise given the ways that Kaplan and Norton’s texts on the balanced scorecard
interweave the concept with objects. With few notable exceptions (Noerreklit, 2000,
2003) these texts, however, have escaped research-focused exploration, so that even
today the craft of the concept-object relationship, defining the balanced scorecard,
remains to be explored in detail.
JAOC Conclusion
8,4 Going forward, I suggest that we need to explore in more differentiated ways, what
expectations users have in the balanced scorecard concept, and how they in light of
these expectations mobilize its objects. My observations suggest that managers often
expect that their use of the balanced scorecard objects will translate and materialize the
concepts. Moreover, I note that a certain reading of Kaplan and Norton’s text might
524 actually sustain this expectation – even it is not realistic. This suggests that it could be
both interesting and relevant to explore the balanced scorecard in terms of its
concept-objects relationship both in text and in action. This relationship concerns the
ways that “strategy is translated into action” – one of the most central arguments
promoting the balanced scorecard (Kaplan and Norton, 1996). Curiously, this
translation from concept to object has never really been researched. To the extent that
my teaching-based observations were generalizable in the sense that it is a common
phenomenon that managers take objects for concepts, it seems that many of the
findings presented by previous research would suddenly appear more plausible than
surprising. But also, we might find that they suddenly would say less about the
practice of balanced scorecards than we currently assume. In conclusion of these
thoughts and this commentary, I hope to have provoked readers to consider two related
questions. Going forward, at what level should we study managerial
conceptualizations, such as the balanced scorecard, in order to know how it works?
Second, by which level of detail must we study balanced scorecard practices, in order
to know what works, and more critically if the balanced scorecard works?

Note
1. In North America, Weatherhead School of Management (USA) and Rothman School of
Management (CA); in Anglo-Saxon Europe, the Said Business School at the University of
Oxford (UK); in Germanic Europe; European Business School (DE) and Hochschule St Gallen
(CH), and finally; in Scandinavia; Copenhagen Business School (DK) and Ekonomihögskolan
at Lund University (SE)

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Corresponding author
Niels Dechow can be contacted at: niels.dechow@ebs.e

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