7 GREAT Reasons to Balance your Balanced Scorecard

Descartes said “I think therefore I am”.  De Bono says “I do therefore I matter”.   Whether we call it strategy execution or service delivery the fact remains that here in South Africa we rank high on the thinking stakes, and low on the implementation scales.

What is it about execution that ails us so much? Moreover, what can we do about it?  One solution is the introduction of a Balanced Scorecard. Yet a Scorecard of any fashion needs to work for you, and be relevant to your business to achieve the results you desire.  It is more than an academic exercise, but rather needs to provide leaders and managers with a snapshot of the business, one that enables better risk management and improved decision making.

According to Dr. Bob Frost, a Performance Measurement expert, there are 7 GOOD REASONS WHY YOU NEED TO USE A SCORECARD EFFECTIVELY:

1. Scorecards drive better performance.  According to Frost, “feedback enhances performance”. Being able to review your progress towards a goal, drives people (teams and groups) to higher levels of performance.

1. Scorecards translate your strategy. Translating the big picture strategy into tangible concreate steps and metrics is key for any strategy implimentaton.  Your scorecard needs to enable people to move, change direction and implement your thinking faster than your competition. 

1. Scorecards help ensure you have the right measures.  “Effective performance scorecards are, by nature, consciously and purposefully constructed. In building one, you develop a logical structure that helps everyone know what should be measured, what belongs on the scorecard and what does not belong.”  What gets measured gets done, and its critical that you measure the right things as metrics alone are not enough.  WHAT is measured must also be at forefront of your scorecard thinking.

1. Scorecards encourage balanced performance.  “The proper scorecard design keeps the right balance of operational and strategic factors on your radar screen.”  Balancing business as usual with strategic activity will ensure that you have the right balance of focus for success.  An over emphasis on any one strategy may result in a loss of opportunity somewhere else. Your Scorecard activities need to remain in balance, ensuring that all the key elements of success are considered when planning the detailed activities. 

1. Scorecards point out what’s missing.  “The scorecard will help you see if any key factors are missing—the gaps stand out.”  If you don’t have a sound model on which to base your thinking, then it’s highly possible that something will get missed out.  Introducing the Balanced Scorecard should go beyond the obvious measures and also seek to highlight the gaps, what’s missing and what needs to be done to fill those gaps.    

1. Scorecards encourage GREAT management.  Great management is about monitoring performance.  Leadership takes risks, management mitigates them.  For sound corporate management to be in place, a thorough monitoring system needs to be introduced.  The Balanced Scorecard is a way of providing management with the appropriate information to enable them to make decisions and manage risk more effectively.

1. Scorecards communicate – they tell the story.  A view favoured by investors and analysts, a full scorecard tell a full story.  According to Frost the scorecard enables you to “present a compelling picture of performance that is undistorted by focus on an individual issue.”  This ensures that reports do not allow us to be easily ‘distracted’ by one problem and potentially lose sight of the others that require attention.

Organisations, governments, NGO’s and institutions around the world have successfully introduced the Balanced Scorecard to assist them in delivery results to shareholders and stakeholders, ultimately demonstrating how strategic thinking gets translated into business results.  Developed by Harvard Professor, Robert Kaplan and Dr. Dave Norton, the Balanced Scorecard is widely considered as the definitive model for translating strategy into action. 

Prof. Robert Kaplan will be presenting LIVE in South Africa on 17 September 2015, delivering his world renowned lecture on Strategy Execution.  Hosted by Business Results Group, this one-day event promises to provide you with the tools, strategies and techniques to ensure that you continue to get the most out of YOUR Balanced Scorecard.  Book Now //www.brg.co.za/speakers/prof-robert-kaplan/