Hello everyone,
I am new member and I am currently working on my Master's in Human Resource Management. I am excited that I found this site and I hope that I can learn some valuable information.
ddgarrett1977
From United States, Minneapolis
I am new member and I am currently working on my Master's in Human Resource Management. I am excited that I found this site and I hope that I can learn some valuable information.
ddgarrett1977
From United States, Minneapolis
DDGARRETT WELCOME TO THE CLUB. Hope you find it useful to your career. regards LEO LINGHAM
From India, Mumbai
260From India, Mumbai
hello sir
I am a regular reader of your postings in this site. I am a MBA student doing my project on Balanced scorecard. The actual title goes like this
"Orienting a leading consultancy towards Balanced scorecard and an extended application of PCMM"
I like to know your views, challenges and difficulties faced, in the Implementation of the Balanced scorecard.
that will be helpful for my project
with warm regards
jayavel.k
From India, Madras
I am a regular reader of your postings in this site. I am a MBA student doing my project on Balanced scorecard. The actual title goes like this
"Orienting a leading consultancy towards Balanced scorecard and an extended application of PCMM"
I like to know your views, challenges and difficulties faced, in the Implementation of the Balanced scorecard.
that will be helpful for my project
with warm regards
jayavel.k
From India, Madras
hi DDGARRETT , u r welcome to the forum and i think u will get more excited after seein the great fast funtioning of the froum and how valurbale it is for studies tooo
From India, Vadodara
From India, Vadodara
Balanced Scorecard?
The Balanced Scorecard is a powerful framework to help organizations rapidly implement strategy by translating the vision and strategy into a set of operational objectives that can drive behavior, and therefore, performance. Strategy-driven performance measures provide the essential feedback mechanism required to dynamically adjust and refine the organization's strategy over time. The Balanced Scorecard concept is built upon the premise that what is measured is what motivates organizational stakeholders to act. Ultimately all of the organization's activities, resources, and initiatives should be aligned to the strategy. The Balanced Scorecard achieves this goal by explicitly defining the cause and effect relationships between objectives, measures, and initiatives across each perspective and down through all levels of the organization. Developing a Balanced Scorecard is the first step in creating a Strategy-Focused Organization.
BALANCE SCORECARD is not a measurement, but a tool.
-measure, analyze and manage financial and operational performance.
-translate strategic and tactical corporate objectives into individual performance measures.
-link performance results with the processes that have driven those results.
-align strategy with tactical operations.
-leverage the value of all other IT applications.
STEP 1. Translate the Strategy to Operational Terms.
A Strategy-Focused Organization translates strategy into action when it organizes a “strategy map” framework of cause and effect between its strategic objectives, then operationalizes these objectives with measures which, considered as a group, comprise a Balanced Scorecard. This “hypothesis” about how the strategy will create value involves objectives drawn from, at a minimum, four perspectives: Financial, Customer, Internal Process, and Learning and Growth
CHALLENGE/ DIFFICULTIES
-often, organizations do not develop microstrategies.
-often, strategies are not communicated down the organization
-often, tactics are not synchronised with strategies.
-often, strategies are not evaluated.
--------------------------------------------------------------------------------------
STEP 2. Align the Organization to the Strategy.
A Strategy-Focused Organization achieves strategic alignment when the whole of the organization exceeds the sum of its parts. This synergy occurs when all parts of the organization focus on strategic themes and priorities as defined by their strategy map and corresponding Balanced Scorecards for the corporate, business unit and support units.
CHALLENGES/ DIFFICULTIES
-strategies are not cascaded down the organization.
-corporate strategies are not aligned with business units/ departments strategy due to poor communication.
-business units strategies are often not tested to see its alignment with company strategies.
--------------------------------------------------------------------------------------------
STEP 3. Motivate by Making Strategy Everyone's Job
Strategy-Focused Organizations motivate their people to execute strategy when they use the Balanced Scorecard as a communications tool for educating every single associate. As individuals set personal work objectives which align with the organization’s Balanced Scorecard, and are thereafter rewarded with compensation and recognition—for both individual and team accomplishment—the strategy becomes part of their everyday jobs.
CHALLENGES / DIFFICULTIES
-lack of proper / effective communication of the strategies.
-lack BALANCE SCORECARD education through out the organization.
-individuals objectives are not aligned with the strategy .
-compensation / recognition do not match with the strategy.
---------------------------------------------------------------------------------------
STEP 4. Adapt by Making Strategy a Continual Process.
Strategy-Focused Organizations adapt their management systems so that both strategy and tactics are managed as a “double-loop” process on a continual basis. They accomplish this by linking strategy to the budgeting process (yielding both operational and strategic budgets), to the management meeting (yielding both operational and strategic performance reviews), and to the learning process (yielding both operational and strategic information systems).
CHALLENGE / DIFFICULTIES
-sometimes strategy is not linked to the objectives.
-sometimes strategy is not linked to the budget.
-results do not tally with the strategy.
-feedback provided do not reflect reality.
-corrective action taken do not reflect the strategy
----------------------------------------------------------------------------------------------------
STEP 5. Mobilize Change Through Executive Leadership
A Strategy-Focused Organization mobilizes change when executives launch and manage a strategy-driven change process with visible energy and committed ownership. The typical executive champions a strategic change by establishing a sense of urgency, creating a guiding coalition, and developing a vision and strategy to guide behavior. After the change process is launched, a revised governance system navigates the transition, followed by more permanent structural changes in the management system which affect resource allocation and compensation.
CHALLENGE / DIFFICULTIES
-even senior management do meet regularly to review strategies.
-there is no feedback to the organization.
-there is no feedback from the lower level of the organization.
-organization culture do not reflect the strategy.
----------------------------------------------------------------------------------------------
What is the relationship of the Balanced Scorecard to core competencies?
Core competencies and the resource-based view of business strategy call upon companies to leverage certain critical capabilities, resources, or competencies to achieve sustainable competitive advantage. This approach can be reflected in the scorecard, typically in the internal perspective, by identifying the objectives for specific internal processes that will enhance critical capabilities or leverage the strategic resources. The scorecard extends the ideas by adding the objectives and measures for the markets and customer segments that the company expects to succeed in with its core capabilities and critical resources. Or the core competencies might be leveraged to lower costs and increase asset productivity in which case the linkages would go from the internal perspective to objectives and measures in the SC's financial perspective.
---------------------------------------------------------------------------------------------------
Why do Organizations develop a Balanced Scorecard?
A: A survey conducted by CFO Magazine in the early 1990's found that only 10% of company strategies are successfully executed. The reasons for the lack of success were grouped into four main categories:
1. The Vision Barrier: Only 5% of the workforce understands the strategy
2. The People Barrier: Only 25% of managers have incentives linked to strategy
3. The Resource Barrier: 60% of organizations do not link their budgeting process to the strategy
4. The Management Barrier: 85% of Management team spend less than one hour/month discussing strategy
The Balanced Scorecard is designed to address these barriers to successful strategy implementation.
What are the benefits of the Balanced Scorecard?
Organizations benefit from the use of the Balanced Scorecard in the following ways:
Clarify the vision throughout the organization
Gain consensus and ownership by the executive team
Provide a framework to align the organization
Provide structure for multiple initiatives
Drive the capital and resource allocation process
Integrate the strategic management process across the organization
Focus teams and individuals on strategic priorities
------------------------------------------------------------------------
What are the applications of the Balanced Scorecard?
Since the concept was introduced in 1992, the Balanced Scorecard framework has been adapted to meet a variety of organizational needs. Common applications include:
Rapid strategy implementation
Post merger integration
Joint venture/Alliance management
IT strategy
Human Resource strategy and compensation alignment
Initiative Management and prioritization
Enterprise transformation/change management diagnostic
Communication with customers, suppliers, and shareholders
Supplier management
Capital budgeting/resource allocation and prioritization
-------------------------------------------------------------------------------------------
TOP management develops the strategy and the front line
makes it happen.
Employees must have a firm understanding of how their
activities and attitudes contribute to the success of the
overall organization.
HOW?
1.communication and education programs for employees.
2.individual and teams objectives are linked to the strategy.
3.incentives/ rewards linked to the objectives/ strategy.
HOPE THIS IS USEFUL TO YOU
REGARDS
LEO LINGHAM
From India, Mumbai
The Balanced Scorecard is a powerful framework to help organizations rapidly implement strategy by translating the vision and strategy into a set of operational objectives that can drive behavior, and therefore, performance. Strategy-driven performance measures provide the essential feedback mechanism required to dynamically adjust and refine the organization's strategy over time. The Balanced Scorecard concept is built upon the premise that what is measured is what motivates organizational stakeholders to act. Ultimately all of the organization's activities, resources, and initiatives should be aligned to the strategy. The Balanced Scorecard achieves this goal by explicitly defining the cause and effect relationships between objectives, measures, and initiatives across each perspective and down through all levels of the organization. Developing a Balanced Scorecard is the first step in creating a Strategy-Focused Organization.
BALANCE SCORECARD is not a measurement, but a tool.
-measure, analyze and manage financial and operational performance.
-translate strategic and tactical corporate objectives into individual performance measures.
-link performance results with the processes that have driven those results.
-align strategy with tactical operations.
-leverage the value of all other IT applications.
STEP 1. Translate the Strategy to Operational Terms.
A Strategy-Focused Organization translates strategy into action when it organizes a “strategy map” framework of cause and effect between its strategic objectives, then operationalizes these objectives with measures which, considered as a group, comprise a Balanced Scorecard. This “hypothesis” about how the strategy will create value involves objectives drawn from, at a minimum, four perspectives: Financial, Customer, Internal Process, and Learning and Growth
CHALLENGE/ DIFFICULTIES
-often, organizations do not develop microstrategies.
-often, strategies are not communicated down the organization
-often, tactics are not synchronised with strategies.
-often, strategies are not evaluated.
--------------------------------------------------------------------------------------
STEP 2. Align the Organization to the Strategy.
A Strategy-Focused Organization achieves strategic alignment when the whole of the organization exceeds the sum of its parts. This synergy occurs when all parts of the organization focus on strategic themes and priorities as defined by their strategy map and corresponding Balanced Scorecards for the corporate, business unit and support units.
CHALLENGES/ DIFFICULTIES
-strategies are not cascaded down the organization.
-corporate strategies are not aligned with business units/ departments strategy due to poor communication.
-business units strategies are often not tested to see its alignment with company strategies.
--------------------------------------------------------------------------------------------
STEP 3. Motivate by Making Strategy Everyone's Job
Strategy-Focused Organizations motivate their people to execute strategy when they use the Balanced Scorecard as a communications tool for educating every single associate. As individuals set personal work objectives which align with the organization’s Balanced Scorecard, and are thereafter rewarded with compensation and recognition—for both individual and team accomplishment—the strategy becomes part of their everyday jobs.
CHALLENGES / DIFFICULTIES
-lack of proper / effective communication of the strategies.
-lack BALANCE SCORECARD education through out the organization.
-individuals objectives are not aligned with the strategy .
-compensation / recognition do not match with the strategy.
---------------------------------------------------------------------------------------
STEP 4. Adapt by Making Strategy a Continual Process.
Strategy-Focused Organizations adapt their management systems so that both strategy and tactics are managed as a “double-loop” process on a continual basis. They accomplish this by linking strategy to the budgeting process (yielding both operational and strategic budgets), to the management meeting (yielding both operational and strategic performance reviews), and to the learning process (yielding both operational and strategic information systems).
CHALLENGE / DIFFICULTIES
-sometimes strategy is not linked to the objectives.
-sometimes strategy is not linked to the budget.
-results do not tally with the strategy.
-feedback provided do not reflect reality.
-corrective action taken do not reflect the strategy
----------------------------------------------------------------------------------------------------
STEP 5. Mobilize Change Through Executive Leadership
A Strategy-Focused Organization mobilizes change when executives launch and manage a strategy-driven change process with visible energy and committed ownership. The typical executive champions a strategic change by establishing a sense of urgency, creating a guiding coalition, and developing a vision and strategy to guide behavior. After the change process is launched, a revised governance system navigates the transition, followed by more permanent structural changes in the management system which affect resource allocation and compensation.
CHALLENGE / DIFFICULTIES
-even senior management do meet regularly to review strategies.
-there is no feedback to the organization.
-there is no feedback from the lower level of the organization.
-organization culture do not reflect the strategy.
----------------------------------------------------------------------------------------------
What is the relationship of the Balanced Scorecard to core competencies?
Core competencies and the resource-based view of business strategy call upon companies to leverage certain critical capabilities, resources, or competencies to achieve sustainable competitive advantage. This approach can be reflected in the scorecard, typically in the internal perspective, by identifying the objectives for specific internal processes that will enhance critical capabilities or leverage the strategic resources. The scorecard extends the ideas by adding the objectives and measures for the markets and customer segments that the company expects to succeed in with its core capabilities and critical resources. Or the core competencies might be leveraged to lower costs and increase asset productivity in which case the linkages would go from the internal perspective to objectives and measures in the SC's financial perspective.
---------------------------------------------------------------------------------------------------
Why do Organizations develop a Balanced Scorecard?
A: A survey conducted by CFO Magazine in the early 1990's found that only 10% of company strategies are successfully executed. The reasons for the lack of success were grouped into four main categories:
1. The Vision Barrier: Only 5% of the workforce understands the strategy
2. The People Barrier: Only 25% of managers have incentives linked to strategy
3. The Resource Barrier: 60% of organizations do not link their budgeting process to the strategy
4. The Management Barrier: 85% of Management team spend less than one hour/month discussing strategy
The Balanced Scorecard is designed to address these barriers to successful strategy implementation.
What are the benefits of the Balanced Scorecard?
Organizations benefit from the use of the Balanced Scorecard in the following ways:
Clarify the vision throughout the organization
Gain consensus and ownership by the executive team
Provide a framework to align the organization
Provide structure for multiple initiatives
Drive the capital and resource allocation process
Integrate the strategic management process across the organization
Focus teams and individuals on strategic priorities
------------------------------------------------------------------------
What are the applications of the Balanced Scorecard?
Since the concept was introduced in 1992, the Balanced Scorecard framework has been adapted to meet a variety of organizational needs. Common applications include:
Rapid strategy implementation
Post merger integration
Joint venture/Alliance management
IT strategy
Human Resource strategy and compensation alignment
Initiative Management and prioritization
Enterprise transformation/change management diagnostic
Communication with customers, suppliers, and shareholders
Supplier management
Capital budgeting/resource allocation and prioritization
-------------------------------------------------------------------------------------------
TOP management develops the strategy and the front line
makes it happen.
Employees must have a firm understanding of how their
activities and attitudes contribute to the success of the
overall organization.
HOW?
1.communication and education programs for employees.
2.individual and teams objectives are linked to the strategy.
3.incentives/ rewards linked to the objectives/ strategy.
HOPE THIS IS USEFUL TO YOU
REGARDS
LEO LINGHAM
From India, Mumbai
hello Mr.Leolingam
Thanks for the valuable and amazing, unexplored information given by you. If you can recommend your known other HR Personnel to reply to the same query, it will be helpful for my project work.
with regards
jayavel.k
From India, Madras
Thanks for the valuable and amazing, unexplored information given by you. If you can recommend your known other HR Personnel to reply to the same query, it will be helpful for my project work.
with regards
jayavel.k
From India, Madras
hi i am new to the site shyam pursuing MBA (HR) in D J Academy coool about the site very useful informations can be gathered
From India, Coimbatore
From India, Coimbatore
Hi My name is Ashish and i am doing MBA in HR through a distance learning programe and i want to know what are important topics to clera exams.
From India, New Delhi
From India, New Delhi
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