David P. Norton

Bio: David P. Norton is an academic researcher. The author has contributed to research in topics: Strategy map & Performance measurement. The author has an hindex of 1, co-authored 1 publications receiving 6931 citations.

The Balanced Scorecard: Translating Strategy into Action

Abstract: The rapid evolution of the Balanced Scorecard into a strategic managment system is reported on in this book. The Balanced Scorecard approach retains traditional financial measures which reflect past organizational acheivements, but adds three new measures of future performance found necessary in this information age with its focus on customer relationships and long-term capabilities: customer, internal business process, and learning and growth. With these four perspectives providing the framework for the Balanced Scorecard, organizations can now measure how they create value for customers, how they can enhance internal competencies, and how they must invest in people, systems and procedures to improve future performance. According to the authors, the Balanced Scorecard has evolved from an improved measurement system to a core management system. For the first time there is a systematic process to implement and obtain feedback about strategy. This is an excellent introduction to new management styles.

The DeLone and McLean Model of Information Systems Success: A Ten-Year Update

Abstract: Ten years ago, we presented the DeLone and McLean Information Systems (IS) Success Model as a framework and model for measuring the complex-dependent variable in IS research. In this paper, we discuss many of the important IS success research contributions of the last decade, focusing especially on research efforts that apply, validate, challenge, and propose enhancements to our original model. Based on our evaluation of those contributions, we propose minor refinements to the model and propose an updated DeLone and McLean IS Success Model. We discuss the utility of the updated model for measuring e-commerce system success. Finally, we make a series of recommendations regarding current and future measurement of IS success.

Transforming the Balanced Scorecard from Performance Measurement to Strategic Management: Part II

Abstract: Several years ago we introduced the Balanced Scorecard (Kaplan and Norton 1992). We began with the premise that an exclusive reliance on financial measures in a management system is insufficient. Financial measures are lag indicators that report on the outcomes from past actions. Exclusive reliance on financial indicators could promote behavior that sacrifices long-term value creation for short-term performance (Porter 1992; AICPA 1994). The Balanced Scorecard approach retains measures of financial performance--the lagging outcome indicators--but supplements these with measures on the drivers, the lead indicators, of future financial performance. THE BALANCED SCORECARD EMERGES The limitations of managing solely with financial measures, however, have been known for decades. [1] What is different now? Why has the Balanced Scorecard concept been so widely adopted by manufacturing and service companies, nonprofit organizations, and government entities around the world since its introduction in 1992? First, previous systems that incorporated nonfinancial measurements used ad hoc collections of such measures, more like checklists of measures for managers to keep track of and improve than a comprehensive system of linked measurements. The Balanced Scorecard emphasizes the linkage of measurement to strategy (Kaplan and Norton 1993) and the cause-and-effect linkages that describe the hypotheses of the strategy (Kaplan and Norton 1996b). The tighter connection between the measurement system and strategy elevates the role for nonfinancial measures from an operational checklist to a comprehensive system for strategy implementation (Kaplan and Norton 1996a). Second, the Balanced Scorecard reflects the changing nature of technology and competitive advantage in the latter decades of the 20th century. In the industrial-age competition of the 19th and much of the 20th centuries, companies achieved competitive advantage from their investment in and management of tangible assets such as inventory, property, plant, and equipment (Chandler 1990). In an economy dominated by tangible assets, financial measurements were adequate to record investments on companies' balance sheets. Income statements could also capture the expenses associated with the use of these tangible assets to produce revenues and profits. But by the end of the 20th century, intangible assets became the major source for competitive advantage. In 1982, tangible book values represented 62 percent of industrial organizations' market values; ten years later, the ratio had plummeted to 38 percent (Blair 1995). By the end of the 20th century, the book value of tangible assets accounted for less than 20 percen t of companies' market values (Webber 2000, quoting research by Baruch Lev). Clearly, strategies for creating value shifted from managing tangible assets to knowledge-based strategies that create and deploy an organization's intangible assets. These include customer relationships, innovative products and services, high-quality and responsive operating processes, skills and knowledge of the workforce, the information technology that supports the work force and links the firm to its customers and suppliers, and the organizational climate that encourages innovation, problem-solving, and improvement. But companies were unable to adequately measure their intangible assets (Johnson and Kaplan 1987, 201-202). Anecdotal data from management publications indicated that many companies could not implement their new strategies in this environment (Kiechel 1982; Charan and Colvin 1999). They could not manage what they could not describe or measure. INTANGIBLE ASSETS: VALUATION VS. VALUE CREATION Some call for accountants to make an organization's intangible assets more visible to managers and investors by placing them on a company's balance sheet. But several factors prevent valid valuation of intangible assets on balance sheets. …

A Strategic Framework for Customer Relationship Management

Abstract: In this article, the authors develop a conceptual framework for customer relationship management (CRM) that helps broaden the understanding of CRM and its role in enhancing customer value and, as a result, shareholder value. The authors explore definitional aspects of CRM, and they identify three alternative perspectives of CRM. The authors emphasize the need for a cross-functional, process-oriented approach that positions CRM at a strategic level. They identify five key cross-functional CRM processes: a strategy development process, a value creation process, a multichannel integration process, an information management process, and a performance assessment process. They develop a new conceptual framework based on these processes and explore the role and function of each element in the framework. The synthesis of the diverse concepts within the literature on CRM and relationship marketing into a single, process-based framework should provide deeper insight into achieving success with CRM strategy...

Motivation, Knowledge Transfer, and Organizational Forms

Abstract: Employees are motivated intrinsically as well as extrinsically. Intrinsic motivation is crucial when tacit knowledge in and between teams must be transferred. Organizational forms enable different kinds of motivation and have different capacities to generate and transfer tacit knowledge. Since knowledge generation and transfer are essential for a firm's sustainable competitive advantage, we ask specifically what kinds of motivation are needed to generate and transfer tacit knowledge, as opposed to explicit knowledge.