Open AccessTHE BALANCED SCORECARD AS A STRATEGIC PERFORMANCE CONTROL TOOL AND ITS LINK TO THE ECONOMIC PROFIT MEASUREMENT- EVA AND MVA: A LITERATURE REVIEW
Author(s) -
Anbalagan Krishnan,
R. Ravindran
Publication year - 2010
Publication title -
journal of applied finance and accounting/journal of applied finance and accounting
Language(s) - English
Resource type - Journals
eISSN - 2746-6019
pISSN - 1979-6862
DOI - 10.21512/jafa.v2i2.155
Subject(s) - balanced scorecard , economic value added , management control system , profit (economics) , performance measurement , earnings before interest and taxes , business , strategic control , strategy map , control (management) , profit center , return on investment , process management , non profit , strategic management , profit impact of marketing strategy , marketing , economics , industrial organization , strategic planning , accounting , business administration , management , strategic financial management , microeconomics
The organizational performance measurement and control system is vital to sustain the business in all economic environments. Organization requires a control system that measures the performance strategically. This paper gathers the literature discussion of one such popular integrated strategic performance control system, the balanced scorecard approach (BSC). The discussion focuses on BSC approach on facilitating the implementation of organizational strategic and its link to the economic profit measures. Two popular economic profit measures, the Economic Value Added (EVA) and Market Value Added (MVA) are discussed in detail from various researchers point of view. The paper highlights the difference between these two measures and difference with the Return on Investment (ROI). The limitation of the economic profit measure is also highlighted in the discussion. As conclusion the link between the BSC strategic performance control tool and the economic profit measures are noted. This paper provides detailed discussions of both BSC strategic tool and economic profit measures based on literature review.