How to Create a Balanced Scorecard in Excel (with Detailed Steps)

One of the most frequently used tools in the managerial sector is the scorecard model. If you own a company or run an organization, then it is a must to get an idea about the internal condition of the company and predict which aspects you should emphasize for its overall growth. And for performing all these tasks, a balanced scorecard model will ease your journey to achieve e your goal. If you want to create a balanced scorecard in Excel, then you have landed in the right place. I will show you some easy steps on how to create a balanced scorecard in Excel in this article.


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What Is a Balanced Scorecard?

The Balanced Scorecard system was first developed by Robert Kaplan and David Norton. This is actually a frequently used framework in the sector of organizational management. Every company must have to set a goal and plan successively in order to achieve the goal. So, managers need to track the important issues of the organization to develop strategic performance. The monetarization of strategic initiatives, actions, key performance, and time frames for implementation is highly recommended to achieve this goal.

The overall performance of the organization is found from the Balanced Scorecard model and the facts that should be emphasized for the internal growth of the company can be picturized.


Steps to Create a Balanced Scorecard in Excel

This section will familiarize you with some easy steps to create a Balanced Scorecard in Excel.

Let’s say, we are looking at a company that is trying to measure its operational performance. We are considering 4 categories:

  • Transportation
  • Warehousing
  • Inventory Management
  • Order Processing

And within each of these categories, we have some strategic goals that we should optimize for overall growth. So, for creating a balanced scorecard model, I will proceed with the following steps below. Let’s check them right now!


Step 1: Assign Factors for Scorecard Model

First of all, assign the parameters which will denote the performance of the company. I have set these parameters for the model:

  • Strategic Measurement
  • Weight
  • Predetermined Score (50 and 100)
  • Actual Condition
  • Score
  • Fulfillment
  • Weighted Score

Create a Balanced Scorecard in Excel

Note: You can add more parameters and proceed with your acquainted strategy based on your strategic plan.

  • Then, assign the strategic goals under each of the categories. I have used my factors like the screenshot below. Define which factors affect your performance and assign them under each category.

Create a Balanced Scorecard in Excel

Read More: How to Create a Scoring System in Excel (With Easy Steps)


Step 2: Set Weight to the Scorecard

Now, set the percentages of the categories (i.e. Weight) which are keeping effects on the performance of the organization.

Create a Balanced Scorecard in Excel

Note: Make sure that the total weight of the categories must have to be 100%.

  • After that, assign the percentages of the strategic goals under each of the acting categories. Keep in mind that, just like the categories, the subtotal of each of the factors under the categories should be 100%.

For example, Transportation has 3 factors:

  1. Damaged  Goods Delivered (25%)
  2. On-Time Delivery (55%)
  3. Average Costs Per Order (20%)

The total of these factors must be 25%+55%+20%=100%.

The same goes for the other categories.

Create a Balanced Scorecard in Excel

Read More: How to Calculate Total Score in Excel (4 Easy Ways)


Step 3: Calculate Score in Model

Now it’s time to calculate the score based on the assigned inputs denoting the strategic goals.

  • Here, we have two column headings (i.e. 50 and 100). These two actually denote scores for the corresponding inputs.

For example, in the case of the Damaged Goods Delivered, if the percentage of the delivered damaged products is 4% then the score will be 50 and if the percentage is 2%, then the score will be 100. So, the score will be increased with the decrease of the damaged products.

Create a Balanced Scorecard in Excel

  • Hence, assign the values for the determined scores (50 and 100) for each of the factors.

Create a Balanced Scorecard in Excel

  • Now, input the Actual values of the corresponding factors under each category.

Create a Balanced Scorecard in Excel

  • Now, apply the following formula for one factor (i.e. Damaged Goods Delivered).

=G6*($F$4-$E$4)/(F6-E6)+($E$4*F6-$F$4*E6)/(F6-E6)

Here,

  • E4= 50
  • F4= 100
  • E6= 4%
  • F6= 2%

  • Hence, apply a similar formula for the other factors also to get the corresponding score.


Step 4: Create the Balanced Scorecard

Now. it’s time to complete the balanced scorecard model.

  • Here, apply the following formula to the fulfillment column.

=H6*D6

Here,

  • H6= Actual Score
  • D6= Percentage of Damaged Goods Delivered

  • Now, use Autofill to drag the formula for the other factors.

  • Then, we will use the SUM function to apply the following formula to calculate the weighted score.

=SUM(I6:I8)*D5

Here,

  • I6= First cell of the Fulfillment column
  • I8= last cell of the Fulfillment column
  • D5= Weight percentage of Transportation

  • Similarly, calculate the Weighted Score for the other categories.

  • Last of all, calculate the Total Weighed Score considering each category by applying the following formula.

=SUM(J6,J10,J13,J16)

Read More: How to Calculate Quality Score in Excel (with Easy Steps)


Conclusion

In this article, I have tried to show you some methods of how to create a balanced scorecard in Excel. I hope this article has shed some light on your way of creating a balanced scorecard in an Excel workbook. If you have better methods, questions, or feedback regarding this article, please don’t forget to share them in the comment box. This will help me enrich my upcoming articles. For further queries, kindly visit our website ExcelDemy. Have a great day!


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Rafi

Rafi

Hey there! I am Md. Rafiul Hasan. Currently I am working as an Excel & VBA content developer. I like new ideas and want to explore the field of innovation. Excel has saved our worktime and made it easy for us to quick calculations. I am trying to make it easier for you to overcome the obstacles you face while working on Excel. Stay connected!

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