I am in the stage of creating strategy maps for my client. Here is my project plan

1) Discuss the strategy map with my point of contact 2) Interview the senior management to understand the 'most important actions' of their organization and priorities/strategy. This will help me refine my strategy map. 3) Finalize the strategy map and conduct a workshop for the senior management 4) Freeze the strategy map and create the Balanced Scorecard aligning to the strategy map 5) Operationalize the Balanced Scorecard

Now, I would like to know if there is a better way of implementing the Strategy Map and the Balanced Scorecard. Am I missing out on something?

asked Jun 11 '12 at 02:15

msr_stratconsult's gravatar image

msr_stratconsult
1122


Yes.

You need to take account of the need to engage the senior management in the design process itself.

The steps you outline indicate that you see your role as being the person who designs and implements the Balanced Scorecard, and your engagement with senior management is a bit of data collection and then getting them to agree to your design. This is less than ideal in (at least) three respects:

  • Balanced Scorecard is a framework for helping people identify a small number of measures that will provide information useful to ensuring that they more effectively implement their organisation's strategy. Fundamental to this is the need to understand what the strategy being implemented is, and the capacity / capability of the organisation it is being implemented within. But it has been shown (e.g. By Henry Mintzberg in his critique of the "Design School") that the ability of an external agent to understand an organisation through interviews and document review is very poor: effectively they are confined to making generic recommendations that are largely independent of the capacity and / or needs of the organisation itself - so the Balanced Scorecard you develop will similarly be disconnected from the actual needs of the organisation you are working for
  • Balanced Scorecard needs to influence the decision making of the senior management team (that's how it works). It was long ago shown that the most common cause of Balanced Scorecard 'failure' is simply that the Balanced Scorecard is not adopted by the senior management team. 2GC's work has shown that a very large part of this rejection is driven by perceptions of 'relevance' within the senior management team - relevance scores are greatly enhanced if the senior managers themselves have chosen the objectives / measures, rather than if they simply sign off on choices made by others. To give your Balanced Scorecard a good chance of being adopted, you need to make it possible for the senior managers to design their own Balanced Scorecard not do it for them.
  • A key part of Balanced Scorecard implementation is 'getting the reporting to work', such as ensuring that data is collected and collated on a regular and timely basis, and that meetings are held (by the senior management) that have as their focus the review of the data assembled into the Balanced Scorecard. 2GC's experience is that this co-ordination and organisation cannot be done by outsiders - you need to establish the resources and capabilities within the organisation, and usually this only will be done if you have the direct engagement of the senior managers (because to do the work required to set up and report a Balanced Scorecard you need to empower and resource a small team within the organisation)

View your role in Balanced Scorecard as a facilitator and process expert - you are contributing experience and knowledge about how the senior management team can design their own Balanced Scorecard speedily and reliably. It is far more difficult a role to fulfil than simply knocking up a table of numbers for someone else, but it is what you need to do if your Balanced Scorecard designs are to have value to the organisation.

HTH

answered Jun 29 '12 at 05:40

Gavin%20Lawrie's gravatar image

Gavin Lawrie
1315

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