Cooperative Extension Service South Dakota State University, Texas A&M University-Kingsville
The key to business success—whether operating a ranch or a Fortune 500 company—lies in management and planning. It’s the ability to have foresight, to carefully evaluate and choose appropriate new concepts and technologies, and to implement a well thought- out plan that complements all aspects of the business. The highly-respected former CEO and chairman of General Electric Jack Welch put it this way: Good business leaders create a vision, articulate the vision, passionately own the vision, and relentlessly drive it to completion. How does that description apply to you? Are you a visionary business leader for your ranch enterprise? Or can you become one? This manual introduces the “Balanced Scorecard” developed by Dr. Robert Kaplan of the Harvard Business School and Dr. David Norton. The duo authored the book The Balanced Scorecard: Translating Strategy Into Action, and the scorecard format has been used by thousands of global companies and small businesses since the early 1990s when it was initially developed. While this concept may be relatively new to the ranching community, adopters of this approach to management include corporate icons like General Electric, DuPont, Ford Motor Company, IBM, and Walt Disney World. Using the scorecard, a manager can clearly see the things that need to be measured to “balance” different competing parts of the ranch. For example, rather than analyze financial records alone—which are only capable of telling of past events—this approach also takes into account things such as customer relationships, ranch processes, and investment in family members and employees’ learning and growth— all of which can have an impact on future business success. Central to the effectiveness of the Balanced Scorecard is viewing the business (your ranch) from these perspectives and then developing strategies and evaluating outcomes relative to each of those perspectives. By doing so, you can build a stronger base for your future sustainability. To that end, this manual offers a step-by step guide for the ranching industry to adopt the Balanced Scorecard and move toward managing for ranch business success.
Dunn, Barry H.; Gates, Roger N.; Davis, Jack; and Arzeno, Agustin, "Using the Balanced Scorecard for Ranch Planning and Management:Setting Strategy and Measuring Performance" (2006). SDSU Extension Circulars. 486.