Welcome to our next Say of the Day.
SAY OF THE DAY
“Most people spend more time and energy going around problems than in trying to solve them.” – Henry Ford
Talking about solving problems.
I have found in my operations management experience that the proper use of the balanced scorecard is essential to really keep track and understand what IS Your Business.
The development of a balanced scorecard has been made extremely complicated and it need not be. When I went on the Kaplan and Norton Balanced Scorecard Course I was dumbfounded to find that we had to read 5 books and go through over 900 pages of A4 lecture notes. I passed with a very good mark, and Kaplan and Norton signed my books.
Since passing I struggled to use the process they taught me as it drove my Customers insane; to the extent that I summarized the whole course and wrote my own Balance Scorecard training course,. This broken down inot two courses; a two-day course for the advanced module and a one day course for the introduction. And you leave with a complete knowledge and having completed a balanced scorecard on my excel template I created.
Say of the Day
By the way, a very well priced Balanced Scorecard software package is sold by BSC and you get full training with videos and tutorials which is critical.
Over the past several decades, organizations have come to realize that success cannot only be measured in dollars and cents. Intangible assets (like a company’s reputation, the knowledge base created by their employees, and training initiatives) can make up a huge portion of a company’s wealth.
It only makes sense, then, that we need a new tool, other than financial statements or operational productivity reports, to help us measure this expanded definition of success. Enter the balanced scorecard! This tool and its related components will help your organization identify, document, plan, and execute a balanced strategic mission. It will also help your organization evaluate and revise its strategic execution.
Say of the Day
Expert Paul Niven describes the balanced scorecard as, “a carefully selected set of quantifiable measures derived from an organization’s strategy.” (Balanced Scorecard: Step-by-Step, 2006)
The tool can be used to communicate, measure, and execute a strategic management plan. That’s a pretty big task, so there are a few documents that support the balanced scorecard:
- A statement outlining the organization’s vision, mission, and strategy.
- A strategy map, which outlines the objectives required to execute the strategy as well as the links between them.
- A tactical action plan, which breaks down the objectives into initiatives and projects.
The scorecard is then created and used to create and implement the tactical action plan. It typically focuses on four perspectives of the business:
- Internal processes
- Employee learning and growth
Say of the Day
The balanced scorecard is not a fad or a quick fix. It requires a significant investment in time and resources. In most organizations, it takes one to three years to complete the design and implementation process. Then, resources must be invested to monitor, report, and communicate results, and to evaluate and update the scorecard.
In 1990, Robert Kaplan (a professor at Harvard University) and David Norton (a Boston consultant) examined this need through a research project. They presented their results in the January-February 1992 edition of the Harvard Business Review, in an article called, “The Balanced Scorecard: Measures that Drive Performance.” Over the next several years, they published more articles in the Harvard Business Review, and companies started trying the strategy out. Kaplan and Norton’s first book, The Balanced Scorecard, was published in 1996.
Since then, half of all Fortune 1000 organizations have adopted the scorecard. As well, Kaplan and Norton (as well as others) have written many books refining the scorecard, evolving it into a strategic management system, and adapting it for various uses. The Harvard Business Review has even called it one of the most influential ideas of the 20th century!
Say of the Day.
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