Professional Documents
Culture Documents
Scorecard
CIPD Norfolk Group, 17 October
2006
Richard Barnes
Culturetracker.com
What is a “Balanced”
Scorecard
A strategic and operational tool
Owned by the Executive
Shared by everyone
Balances:-
Long and short term
Hard and soft measures
Leading and trailing indicators
Internal/external perspectives
Like writing a novel, not writing a list
Measures support change, not monitoring
It is NOT
A new idea
An end in itself
A playing field for internal politics
An “initiative” of Finance, HR,
Marketing etc.
Boardroom art
A make-work exercise
Its origins
Nolan-Norton Consultants 1990
12 client “Organisation of the Future” study
group
Based on premise that financial measures were
insufficient for a modern business
Principles espoused previously by:-
Rensis Likert (The Human Organisation, 1960)
TQM “gurus” (Deming, Crosby, Juran etc.)*
European Foundation for Quality Management
(1985)
Maisel and McNair parallel models
* Original K&N source was part of a TQ programme
The EFQM Excellence Model
9%
9%
10% 14%
8% 20%
15%
9% 6%
Customer
Balanced Business
Financials Scorecard Processes
Learning
& growth
A question of balance?
Customer perspective
Corrective activity
Developmental activity
Balancing compliance
with added value
Financial Measures Business Processes
Key performance ratios Drumbeat
Balanced
Financial health Time, cost, quality
Balancing leading with Scorecard Balancing inputs
trailing indicators and outputs
Learning and growth
People measures
Knowledge measures
Balancing soft and
hard indicators
Building the Balanced
Scorecard
How do you
create value?
The key
question
A strategic tool
Starts with strategy
Continuous process
Needs to become
culturally
embedded
The story of a scorecard
To be successful for our shareholders, we must be (position in market),
which means that we must return superior financial results in .......
Our customers are the people who will secure these results for us so we
must offer our customers superior value by .........
To deliver this superior value we must excel in the way we manage the
processes for .......
These processes are operated by our people. We must provide our people
with ....... to achieve excellent performance.
Cause and effect chain
Strategic Objective
May be What
reversed Financial Measure
How
Customer Value Measure
How
Process Measure
How
Employee Measure
Cause and effect chain
example
Become No 2 player
What
F Market share
How
C Service span offer
How
P Services delivered per customer
How
E Availability of data
The Balanced Scorecard
Where does it
fit?
Where does it fit? Building
Using
Balanced
Scorecard
Vision
Mission and CSFs
Strategic Objectives
Measures
Alliances
Structure
Rewards
Systems
Projects
Targets
Drill-down
into HR
systems
Performance management
Age What is Key process Key Output Culture
valued?
Pre-industrial Community Belonging Contribution Social
Age Loyalty
…with grateful
thanks to Catbert
Customer
•On time delivery
•Customer satisfaction score on
product quality
Business Processes
•Employee satisfaction
Financials Balanced •Capacity utilization
•Budget management Scorecard at •No. of samples deviating from FCO
•Operating expenses Specifications
•Material consumption