The Balanced Scorecard - Implementation Challenges

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The "7 Deadly Sins" to avoid when implementing the Kaplan & Norton Balanced Scorecard (BSC) approach for strategy implementation

The "7 Deadly Sins" to avoid when implementing the Kaplan & Norton Balanced Scorecard (BSC) approach for strategy implementation

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  • 1. “7 Deadly Sins” in Implementing the Balanced Scorecard Achal Raghavan achalraghavan@yahoo.co.in
  • 2. Contents BSC: The vertical stack-up 7 Deadly Sins in implementation Sum up
  • 3. BSC: The usual visualisation FINANCIAL CUSTOMER Strategy PROCESS LEARNING & GROWTH (PEOPLE)
  • 4. BSC: The vertical stack-up Financial Customer Makes BSC easier to understand Process People
  • 5. 7 Deadly Sins in Implementation
  • 6. Sin #1: “Boss wants it” BSC thrust upon company by corporate office / CEO Top-down directive implemented – for lack of choice No ownership at operating levels
  • 7. #2: Flavour of the month No serious intent to use BSC long-term Seen as new exciting tool by CEO People’s reaction: “This too will pass”
  • 8. #3: Stand-alone system BSC not integrated with company management review process “Stuck on” to existing systems and processes Operates in isolation – no real impact
  • 9. #4: People not clear why “Why Balanced Scorecard” - not explained to people Seen as extra work - “Forms to be filled” “How does it help me do my job better?”
  • 10. #5: Impatience (for results) BSC not given enough time - to make an impact Fundamental change in way of managing business Organisational inertia underestimated
  • 11. #6: Too many initiatives & metrics Too many initiatives and metrics – due to over-enthusiasm People struggle to cope Leads to fatigue and demotivation Max 4 initiatives X 4 perspectives
  • 12. #7: Poor strategy BSC does not ensure sound strategy – it is an implementation methodology Poor strategy + BSC = Poor results!
  • 13. 7 Deadly Sins in BSC implementation “Boss wants it” Flavour of the month Stand-alone system People not clear why Impatience (for results) Too many initiatives & metrics Poor strategy
  • 14. Sum up Avoid the 7 Deadly Sins Start BSC only if you mean it!
  • 15. Thank you!