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DEVELOPING AND IMPLEMENTING A BALANCED SCORECARD
Murray Wu [email protected] The 37th One Stop Update for the Accountant in Business
Source: Bain and Company’s Management Tools and Trends Survey 2013
Source: My opinion
What is the Balanced Scorecard? Objective Measure Target Initiative
Financial
Objective Measure Target Initiative
Customer
Objective Measure Target Initiative
Learning & Growth
Objective Measure Target Initiative
Internal Process Mission
and Vision
Do You Use the BSC to… Set expectations? Manage by objectives? Monitor operational performance? Report results?
If that is all then you are not making the most of your Balanced Scorecard
Underlying Business Logic Mission
and Vision
Financial
Customer
Internal Process
Learning and Growth
Strategy Map
Financial
Customer
Internal Process
Learning and Growth
Improve cost structure
New revenue sources
Introduce design thinking
Easy to find the right product
Develop online
channels
Create partnerships
Increase digital
capabilities
Encourage a learning
environment
Inspire loyalty
Agile culture
Strategy Execution Mission
and Vision
Strategy Map
Scorecard Initiatives
A System for Strategy Execution Develop strategy
Align organisation
Execute initiatives and
operations Monitor
performance
Review and learn
What’s Great • Links purpose to actions • Enables critical thinking • Enhances collective
understanding • Provides focus
What’s Not • Becoming bogged down
in detail • Hard to maintain • Emphasis on targets
rather than outcomes • Oversimplifying
Do You Use the BSC to… Set expectations? Manage by objectives? Monitor operational performance? Report results?
Can you make more use of your Balanced Scorecard?
Develop a hypothesis? Generate an action plan? Share expectations? Communicate your strategy?
BSC in a Complex World
Complicated Complex
Image courtesy of khunaspix at FreeDigitalPhotos.net
1 Culture is Critical
“On average, culture is 8 times more influential on performance variance
than strategy.”
Source: Michael Henderson, “Get Tribal!”, Cultures at Work (2011)
2 Tell Stories
3 Develop Agility Devise simple low cost tests
Sense emergent directions
Act, learn and plan at the same time
Be prepared to change the hypothesis
4 Co-Create Strategy
Enterprises Customers
Communities Stakeholders
Co-Creation
v Include stakeholder views in the development of strategy
v Focus on the interests of all stakeholders and create shared value
v Engage stakeholders and work with them, rather than doing it to them
5 Reviews: Active, Visual And Tactile
Make the Most of Your BSC
Culture is critical for success
Tell the story of your strategy
Treat the BSC as a hypothesis, not a
fixed plan
Design the BSC with your customers, communities and
stakeholders in mind
Actively engage with your BSC
Make the BSC an execution system,
not only a dashboard
The Balanced Scorecard is a framework that enables organisations to translate strategy into a set of linked objectives that drive behaviour and performance.
What is the Balanced Scorecard?
