IPRA Balanced Scorecard Approach

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IPRA Balanced Scorecard Approach

  1. 1. The Balanced Scorecard… IPRA’s New Approach By: Dean Comber, Director of Operations/Project Management
  2. 2. Agenda 1. Overview of the Balanced Scorecard 1. Overview of the Balanced Scorecard 2. Benefits of using the Balanced Scorecard 2. Benefits of using the Balanced Scorecard 3. Lunch/Break 3. Lunch/Break 4. How IPRA will use the Balanced Scorecard 4. How IPRA will use the Balanced Scorecard 5. Questions 5. Questions
  3. 3. What is the Balanced Scorecard? • A concept for measuring a company or organization’s activity in terms of its vision and strategies, to give directors/managers a comprehensive view of the performance of a business. • Introduced in 1992 by Robert Kaplan and David Norton. • Many of the largest and most profitable companies and organizations use this methodology as part of their business protocol.
  4. 4. Who uses the Balanced Scorecard? • BMW • AT&T • IBM • Pfizer • Sears • Etc.
  5. 5. The Four Corners • Financial • Member • Internal Processes • Learning and Growth
  6. 6. Financial Perspective “If we succeed, how will we look to our members?” • Measures whether strategic goals and objectives fit into short/long term financial plans. • Ensures items such as net operating income, cash flow, and costs are adjusted accordingly and reported in a timely manner. • Incorporates three stages: rapid growth, sustainability, and harvesting.
  7. 7. Financial Perspective • Rapid Growth: How is the organization growing to obtain increased revenue, membership, and partnership opportunities? • Sustainability: What measures do we use to monitor and modify our current financial strategies for short/long term growth? • Harvest: How do we as an organization use financial data and models to measure current and future financial success (or even failure)?
  8. 8. Financial Perspective Model Long Term Association Value Cost Efficiency Revenue Growth Improve Cost Structure Expand Revenue Opportunities Increase Utilization Increase Member Value
  9. 9. Member Perspective “To achieve our vision, how must we look to our members?” • Without our members, what is IPRA? • Ensures that elements such as acquisition, retention, and satisfaction are measured. • Strives to meet operational excellence.
  10. 10. Member Perspective Model Acquisition Retention Satisfaction Price Quality Service Value
  11. 11. Internal Process Perspective “To satisfy our members, what processes must we excel at?” • Focuses on processes and protocols that should be modified and/or optimized to in order to meet the needs of our members. • There are four main objectives in this perspective: – Operations Management – Member Management – Innovation Process – Regulatory and Social Process
  12. 12. Internal Process Perspective Model Operations Member Innovation Reg. & Social Management Management Processes Processes Process that Process that Processes that Processes that produce and enhance create new improve deliver member value objectives and communities objectives and services and the services environment •Staffing •Acquisition •New Ideas/Goals •Environment •Customer Service •Growth •Change Mgmt. •Safety/Health •Training •Retention •Communication •Community •Satisfaction
  13. 13. Learning & Growth Process Perspective “To achieve our vision, how must our organization learn and improve?” • Focuses on the intangible assets of the organization, primarily on the internal skills and capabilities that are required to support the value- creating internal processes. • There are three main objectives in this perspective: – Human Capital – Information Capital – Organization Capital
  14. 14. Learning & Growth Perspective Model Human Capital Information Capital Organization Capital •Skills •Systems •Culture •Knowledge •Databases •Leadership •Attitude •Networks •Development
  15. 15. The Four Corners Together Long Term Association Value Cost Efficiency Revenue Growth Financial Price Quality Service Value Member Operations Member Innovation Reg. & Social Management Management Processes Processes Internal Processes Human Capital Information Capital Organization Capital Learning and Growth
  16. 16. IPRA’s Mission Advocacy Community Collaboration Education Inclusion Innovation IPRA’s Vision Outcomes Financial F1 F2 F3 F4 F5 Member M1 M2 M3 M4 M5 Learning and Growth L1 L2 L3 L4 L5 Internal Processes I1 I2 I3 I4 I5
  17. 17. Key Performance Indicators (KPI) • In order to measure any objective, goal, or aspect of the Balanced Scorecard, an indicator or metric must be identified and used to determine performance. • Measures of success should be clear and concise, explained in detail, and costs should not outweigh the expected outcome value. • KPI’s have five specific guidelines: – Relevance – Controllable – Actionable – Simple – Credible
  18. 18. KPI Guidelines • Relevance: Do the KPI’s have a linkage to strategic objectives? • Controllable: Are KPI achievements still under control? • Actionable: Can any action be taken to improve performance? • Simple: Is the KPI easy to explain? • Credible: Are the KPI’s not easy to manipulate?
  19. 19. Benefits of the Balanced Scorecard • There are four main perspectives: financial, member, internal processes, and learning and growth. Each of these perspectives exist in any organization or company. • Each perspective ultimately drives performance and should increase value to the member. • In theory, the Balanced Scorecard is similar to project management; however, goes much further to identify, monitor, and change any objective or goal of a strategic plan. • KPI’s are used as metrics to monitor how performance is being driven and where changes can be made.
  20. 20. Current IPRA Organizational Assessment • IPRA is a two-tier functional organization. Currently, there are six directors and six assistants that report to the CEO. • IPRA has specific business departments, however, these usually only encompass one director and one assistant. In essence, a department consists of one (or two) staff members. • Over time, the culture of IPRA (internally) has created communication silos that in some cases lead to decreased communication and disorientation of project objectives and goals.
  21. 21. Current IPRA Organizational Assessment • In 2006, IPRA initiated a Project Management Office (PMO). • While successful, many issues were determined and no measures of performance were identified in order to apply change management techniques or innovation aspects. • The implementation of project management was used in a simple format: tasks, milestones, and collaboration. • Unfortunately, usage of project management techniques didn’t allow for performance indicators and thus many objectives were completed without determining true value of the outcome.
  22. 22. IPRA and the Balanced Scorecard Benefits of IPRA using the Balanced Scorecard : • Reduction of communication silos. • Removal of wasted resources and allocations. • Increased team collaboration. • Finite and detailed performance metrics. • And most importantly, MEMBER VALUE!
  23. 23. IPRA’s Usage of the Balanced Scorecard Board of Directors/CEO Education Marketing Professional Services S taff IP RA Technology Development- Sponsorships Finance/HR IPRA Members & Constituents
  24. 24. Usage Overview CONCEPT IMPLEMENTATION PERFORMANCE REVIEW Identify the Insert Define metrics Constantly Balanced objectives from and review the Scorecard the strategic performance scorecard to principles to plan into the indicators to apply any Board of Balanced constantly change Directors, IPRA Scorecard and monitor current management staff, and IPRA define projects objectives and protocols and to members. and related related projects. strive for sub-projects. innovation for new services and programs.
  25. 25. Sample Scorecard Item Outcome Restructure and simplify the current IPRA website to increase usability while extending and expanding online resources available to the membership that will assist in a member’s professional career and agency.
  26. 26. Sample Scorecard Item • Financial Perspective: How much will it cost to meet the outcome? What tangible/intangible financial resources exist? What needs to happen for this outcome to be completed and make financial sense? • Member Perspective: What steps need to be completed in order for this outcome to provide value to members? How will we identify if satisfaction is met while quality is increased? • Internal Process Perspective: What resources will it take to complete the outcome? How will each staff member be affected and what is their role? • Learning & Growth Perspective: What aspects will derive the outcome and what will we learn? What do we do with the information and how do we use it in the future?
  27. 27. Sample Scorecard Item • Using the Balanced Scorecard will allow us to define projects to complete the outcome and define metrics to measure every aspect of each perspective. • No matter what the outcome is, each staff member is involved and the ultimate goal is providing member value. • Communication is constant and no confusion or collusion exists. Thus, the outcome is completed on-time, at or under budget and provides exceptional value.
  28. 28. Proposed Outcomes • “Less is more” – IPRA will complete objectives of the strategic plan according to proposed outcome, timeline, and budgetary allocations. • Internal operations will take on a more cyclical approach versus a functional design. • CEO will only be involved when needed and allowed to conduct typical CEO objectives. • Innovation factor will increase. More programs, services, and value while using less resources and reducing costs. • A more methodical and proven approach to conduct business operations while increasing member value.
  29. 29. Conclusion Question/Answer Session

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