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Have you ever mandated a BSC structure (objectives and measures) for your business units? What level of flexibility do you give them in modifying this information? I'm worried about simplicity, but also about creating buy in at that level. |
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Here's my thinking. First, strategic objectives at the "corporate" level cascade down to subordinate units (be they departments, divisions, regions, brands, or whatever) in three structures: Mandatory, Contributory and Discretionary. In the simplest form, the leadership/scorecard team should decide which objectives fit into each of those categories. This becomes the template for the subordinate business units – the Mandatory objectives must be on their strategy map, they must demonstrate their support / linkage to Contributory objectives and they can or cannot use the Discretionary objectives as guidelines. In cases where 100% of the objectives are mandatory, we call those organizations “franchises” like McDonald’s. In cases where there is a low number of mandatory or contributory, we see conglomerates and typical corporations, like J&J, have three or so mandatory, 5 contributory and the rest are discretionary. I’ll put together a YouTube to illustrate these ideas - you can find it by clicking here. |
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There are three primary ways to do a cascade for business units: Top down, bottom-up, and mixed top-down bottom-up. Seems like in your situation a mixed top-down bottom-up approach would be best. This allows the corporate unit to create a template that defines the key themes and/or objectives for all business units, then allows the business units to create scorecards that align directly to them. |
