Key interview quotes:
- “It is a strategy management framework not a system for managing operations – you need an operational dashboard for the latter.”
- “Recognize that cultural barriers will likely pose the greatest barrier to scorecard success.”
- “Start with office tools, etc. After a year or so, migrate to a scorecard automation tool.”
- “Automation enables a company to get the best out of the scorecard – progress tracking and reporting, best practice sharing, etc.”
Dr David Norton has called me “the foremost chronicler and historian of the Balanced Scorecard movement.”
WHO CAN USE BALANCED SCORECARD?
If you have a strategy you can successfully deploy the Balanced Scorecard.
The scorecard also works well alongside frameworks such as Malcolm Baldrige or EFQM.
Keep the Strategy Map simple; understand the difference between objectives and initiatives and recognize that cultural barriers will likely pose the greatest barrier to scorecard success.
WHO SHOULD USE IT?
A scorecard can be used at most organizational levels from the corporate level down to departmental level.
The important question is “what value had the scorecard at this level – how will it improve performance.” There are many examples of good function-level (HR, finance, etc) scorecards.
And remember it is a strategy management framework not a system for managing operations – you need an operational dashboard for the latter, which is different from a Balanced Scorecard.
Remember, CEOs etc get bombarded with lots of ideas. The scorecard has to stand out from the crowd to be of interest. We have enough case studies, etc… now to make the argument.
Editor's note: The problem of stakeholders’ buy-in is often mentioned by other experts as well as end users of the Balanced Scorecard framework. We’ve discussed this in detail in the How to Convince the Stakeholders article.
Start with office tools, etc. After a year or so, migrate to a scorecard automation tool.
Automation enables a company to get the best out of the scorecard – progress tracking and reporting, best practice sharing, etc.
Editor's note: Other experts that we interviewed share a similar point of view; the ideas about Balanced Scorecard automation are further discussed in the Spreadsheet vs. Specialized Scorecard Software article.
ADVICE FOR NOVICES
Understand the importance of strategy maps and that the maps should comprise objectives and not initiatives.
Also people will only buy-in to the idea if they can see how it will make their job easier – if it’s just one more thing to do then they will resist: and rightly do.
Also remember that the scorecard is not a measurement system – this is the biggest mistake that companies make and it stops them from securing the real benefits of the approach – which is around step-change, and breakthrough performance improvement.