Using Performance Management to boost your Balanced Scorecard

Executives invest time in developing metrics & measures yet progress and success is slow... why?

Using Performance Management to boost your Balanced Scorecard

The concept of a Balanced Scorecard has been well accepted in many organisations. Most Balanced Scorecard implementations deal with four primary areas:
  • ‍Financial
  • Customers
  • Internal Business Processes
  • Innovation, Learning and Growth

Executive management has invested considerable time in the development of the metrics and measurements that contribute to a Balanced Scorecard and yet the organisation finds that progress towards achieving these metrics is slow. The question now being asked at board and CEO level is WHY? The answer lies in several areas:

Communication

In most organisations, the C-Level and Senior Executives define the strategy and how they will measure performance against this strategy. The measures and metrics of the strategy are then assigned to senior managers who will be measured on whether or not they achieve the metrics.

The problem however is that this is where it often stops, at a senior management level. Following is a diagrammatic representation of an existing Balanced Scored Card Implementation process:

Without employees, team leaders and supervisors being aware of their part in achieving the strategy and metrics, progress is sporadic and often not to the liking of the senior executives.

These team leaders and supervisors are typically time constrained, over-worked and have many priorities to attend to. The consequence is that Balanced Scorecard metrics are over-looked or attended to in a hurried meeting. This results in a situation where although the workforce understands what has to be done, the actual doing never gets talked through in detail and therefore an individual’s contribution to achieving the objectives of the Balanced Scorecard is difficult to measure.

Accountabilities

Achieving Balanced Scorecard objectives is similar to achieving any other target or goal, every person who has anything to do with the goal must be directed and measured on the progress of that goal. The problem with many Balanced Scorecard implementations is that the “ownership” and accountabilities rest with the executive team. Without making everyone in the organisation accountable for achieving their part in the Balanced Scorecard implementation, progress is inevitably slow.

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