5032772 Implementation Of Balanced Scorecard

Paramjitsharma

implementing - bscbsc

Paramjitsharma

CommunicatingAnd

Linking

Strategic Feedback and

Learning

Planning andTarget Setting

Clarifying andTranslating the

Vision andStrategy

BalanceScorecard

Using BSC asStrategic Framework

For Action

Paramjitsharma

Launching The Balance Scorecard Programme

Obtain Clarity and Consensus about Strategy

Achieve Focus

Leadership Development

Strategic Intervention

Educate the Organisation

Set Strategic Targets

Align Programmes and Investments

Build a feed back system

Build a BalancedScorecard

Build a newManagement

System

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The Dynamics: Mobilizing the Organisation

1 Clarify the Vision

Team formedAt least 3 monthsDeveloping BSCTranslate vision to strategyClarity and UnderstandingBuilding ConsensusCommitment to strategy

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2 Communicate to Middle Managers

Top 3 layers brought togetherLearning and discussingNew StrategyBSC as communication vehicle4-5 months taken

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2B Develop Business unit Scorecards

6-9months (three months)Each SBU Having strategyTranslating strategy into scorecard

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3A Eliminate Nonstrategic Investments

Corporate ScorecardClarifying Strategic PrioritiesIdentify non contributing factorsEliminate them6th month(1 month)

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3B Launch Corporate Change Program

Need for change programmeLaunchedWhen SBU ‘s prepare scorecards6th Month (1 month)

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4 Review Business Unit Scorecard

Review by Executive teamShaping Strategy if needed9-11 months3 months

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5 Refine the Vision

Review brings out cross business issuesNot initially included in corporate strategyCorporate scorecard is updated12 month1 month

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6A communicate the Balance Scorecard

Let the Entire Organisation be communicatedWhen Management team is comfortableDisseminated to entire Organisation12th month1 month

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6B Establish Individual Performance Objectives

Top 3 layers of Management link individual Objectives and performance incentives Compensation to their scorecards

Months 13-14

2 months

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7 Update Long Range Plan and Budget

5 years goals are established for each measure investments required are funded1st year requirement becomes annual budget15-17 months3 months

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8 Conduct Monthly and Quarterly Review

Monthly review processSupplementary quarterly reviewOn strategic issues18th month on going

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9 Conduct Annual Strategy Review

Beginning of 3rd yearStrategy may require reviewExecutive lists new(10) strategic issuesEach SBU is asked to develop strategyOn each issues25-26 Months2 Months

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10 Link Every one’s performance to balance scorecard

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Building An Integrated Management System

1 Strategy formulation & Strategic issue update

2 Link to personal Objectives and Rewards

3 Link to planning, Resource allocation & Annual Budgets

4 Feedback and Strategic Learning

Paramjitsharma


1 Strategy formulation & Strategic issue update

Outlining Strategic IssuesImplementation in each SBU’sLinking Corporate/SBU strategies to Functional Strategies

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2 Link to personal Objectives and Rewards

Linking strategies to personal obj & Rewards

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3 Link to planning, Resource allocation & Annual Budgets

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4 Feedback and Strategic Learning

Periodic Strategic Review

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Some Cautions

Structural Defects

Duplication of effortsDefects in non financial measuresReporting ProblemsCommunication ProblemsUnsound Basis for ResourceAllocation….

Organizational Defects

Defective process of implementationBreakdown in performanceMore about MeasureImitation of good organizationsLack of informationDelay in implementation of BSC

Paramjitsharma

Managing Ongoing Strategic Management System

CommunicatingAnd

Linking

Strategic Feedback and

Learning

Planning andTarget Setting

Clarifying andTranslating the

Vision andStrategy

BalanceScorecard

Director Of Strategic Planning

Director of Human Resources

Chief Financial Officer

Chief InformationOfficer

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Vision & Strategies not actionable

Strategies not linked to departmental and Individual Goals

Strategies not linked to Long term/short term Resource Allocation

Feedback that is tactical not strategic

Barriers to effective Implementation of BSC

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Barriers to effective Implementation of BSC

Strategy &Vision

Financial Plan& CapitalAllocation

Personal MBO &Incentives

MonthlyReview

Budget

1 Vision & Strategy not Actionable

2 Strategy notLinked to Dept Team& Individual Goals

3 Strategy not Linked to Resource Allocation

4 feedback that is tactically not strategic

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Cant be translated into actionCant be acted UponCant be understoodFragmentation & Sub optimization of effortsLacking consensus & ClarityDifferent AgendasNo integrationNot linked coherently to overall strategy

Barrier No 1: Vision and strategy not Actionable

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Not translated into Department/ individual Goals

Different PrioritiesFailure of Human Resource ManagementDisalignment in Goals

Barrier No 2: Strategy not Linked to Goals

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Separate Processes for Long term &Short term Strategic planningFunding to unrelated prioritiesPoor Monthly ReviewsUnfocused New Mgt TechniquesPoor Integration

Barrier No 3: Strategy not Linked to Resource Allocation

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Different Management System for Strategic Implementation

Clarifying & TranslatingThe Strategy & Vision

Planning &Target Setting

Communicating And Linking

Strategic Feedback&

LearningBalance

Scorecard

•Goal alignments from top to bottom•Education and open communication about strategy

•Compensation is linked To Strategy

•Stretch targets are established and accepted•Strategic initiatives are clearly identified•Investments are determined by strategy•Annual Budgets are linked to long term planning

•The strategy is the reference point for the entire management process•The shared vision is the foundation for strategic planning

•Feedback system used to test The hypothesis on which strategy Is based

•Team problem solving

•Strategy development is a Continuous Process

Paramjitsharma

thanks

Documents

5032772 Implementation Of Balanced Scorecard