The Balanced Scorecard (BSC) is a popular strategic management system proposed by Robert Kaplan and David Norton and documented in their books and articles on the subject.
We sometimes have clients who come to us who have implemented the Balanced Scorecard approach to management and are looking for ways to improve their ability to execute and achieve their strategic plans.
They have implemented scorecards for Customer, Financial, Learning & Growth, and Internal Business Processes, but are frustrated with their ability to bring consistent improvement to these areas. Rhythm Systems balanced scorecard software helps you implement the balanced scorecard throughout your organization with visible dashboards that power your team meetings. If you prefer to categorize them with your own labels, our software gives your the flexibility to align them with your own company culture and nomenclature.
Why the frustration and difficulty? What I've seen in my coaching practice is that businesses are excited to implement the Balanced Scorecard. They work hard to put the metrics and scorecards in place. They then begin to apply energy to improvements needed in each of the Scorecard categories simultaneously in order to bring improvement to the business.
And that is where the difficulty lies. No organization, no matter how big and powerful it is, has sufficient energy and resources to bring large-scale improvement in all the Scorecard categories in any given quarter. One client I worked with had been trying for nearly two years to get better results form their Balanced Scorecard, only to finish each quarter and each year frustrated again. They thought if they just worked harder it would get better, but working harder just didn't deliver the results they hoped for. It didn't deliver the business performance that they were looking for.
So in our Rhythm Consulting practice, we coach clients to blend the teachings of the 7 Habits of Stephen Covey and the measurement scorecards in the Balanced Scorecard in order to bring improvement to the business over time by gaining better focus and alignment in the organization around a few top priorities each quarter. This is Covey's Habit #3 to Put First Things First which he illustrates by putting "Big Quarterly Rocks" into your bucket of operational capacity first.
In your Quarterly Planning rhythm, pick the area of the Scorecard that is bringing the most pain to the organization and work on that one area specifically for a quarter or two if needed. Identify 3, at most 5, priorities to focus the organization on each quarter that will bring specific and measurable improvement to that area. Align the energy of the entire organization around that focus to drive the business to success and growth. Set-up specific Priority and KPI dashboards to track your execution against your goals every week of the given quarter. Our Rhythm software is perfect for this. Review and discuss the dashboards each week in your Weekly Meeting rhythm to learn from successes and make adjustments when priorities or KPIs go off-track. Then, when the improvements are realized and ingrained into the business process, move to the next area of greatest pain that needs to be tackled.
Continue this process for 12-24 months and you will see each area of the scorecard improve over time. You will feel the frustration lift and instead feel the peace and zen-like calm that comes from great team execution to achieve your strategy and plans. :-) I always recommend always thinking about this from the customer perspective as much as possible, even when filling out other areas of the balanced scorecard. Make sure that your KPIs are something that affects your customers, both internal and external.
Have you implemented the Balanced Scorecard in your organization to achieve your strategic goals? Please share your success stories or struggles in the comments section below.
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Photo Credit: iStock by Getty Images
Photo Credit: iStock by Getty Images