How to convince the stakeholders to use the Balanced Scorecard concept | BSCDesigner.com

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The Balanced Scorecard is a business tool recognized world-wide by companies' executives. The secret of the successful BSC project is that all key employees, business owners, and top managers are involved. Research show that the biggest challenge during the implementation of the BSC is a motivational problem. Before starting a Balanced Scorecard project it is necessary to explain this business approach to all stakeholders so that they would buy into the design of the Balanced Scorecard and in the future became active users of this business tool. More: http://www.bscdesigner.com/

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How to convince the stakeholders to use the Balanced Scorecard concept | BSCDesigner.com

  1. 1. HOW TO CONVINCE THE STAKEHOLDERS TO USE THE BALANCED SCORECARD CONCEPT By Aleksey Savkin, bscdesigner.com BSC DESIGNER
  2. 2. THE BALANCED SCORECARD Is recognized world-wide by companies' executives BSC DESIGNER
  3. 3. THE BALANCED SCORECARD Is recognized world-wide by companies' executives All key employees, business owners, and top managers must be involved BSC DESIGNER
  4. 4. THE BALANCED SCORECARD Is recognized world-wide by companies' executives All key employees, business owners, and top managers must be involved The biggest challenge is a motivational problem BSC DESIGNER
  5. 5. THE BALANCED SCORECARD Is recognized world-wide by companies' executives The biggest challenge is a motivational problem All key employees, business owners, and top managers must be involved Before starting a Balanced Scorecard project it is necessary to explain this business approach to all stakeholders BSC DESIGNER
  6. 6. THE BALANCED SCORECARD IS ALREADY USED WIDELY
  7. 7. More than 50 % of large enterprises use some type of a balanced scorecard. — Study by Cranfield University THE BALANCED SCORECARD IS ALREADY USED WIDELY BSC DESIGNER
  8. 8. 31% of companies reported Balanced Scorecard as extremely helpful; 42% as a very helpful. — 2GC Balanced Scorecard usage survey THE BALANCED SCORECARD IS ALREADY USED WIDELY BSC DESIGNER
  9. 9. 34% of interviewed companies use BSC for strategic management, 35% for reporting, 17% for operational management. — 2GC Balanced Scorecard usage survey THE BALANCED SCORECARD IS ALREADY USED WIDELY BSC DESIGNER
  10. 10. 70% of organizations had at least partially implemented a Balanced Scorecard by 2006. — Bain & Co THE BALANCED SCORECARD IS ALREADY USED WIDELY BSC DESIGNER
  11. 11. 50% of Fortune 1,000 companies are using the Balanced Scorecard. — Bain & Co THE BALANCED SCORECARD IS ALREADY USED WIDELY BSC DESIGNER
  12. 12. BALANCED SCORECARD was one of the 5 most used business tools in 2013. — Bain & Co, Management Tools & Trends 2013 THE BALANCED SCORECARD IS ALREADY USED WIDELY BSC DESIGNER
  13. 13. Find all the mentioned statistics in the BALANCED SCORECARD FACT SHEET AND STATISTICS section at — www.BSCDesigner.com THE BALANCED SCORECARD IS ALREADY USED WIDELY BSC DESIGNER
  14. 14. WHY COMPANIES USE THE BALANCED SCORECARD?
  15. 15. By now we see that the Balanced Scorecard is used widely, but WHY is it used?
  16. 16. 97% of typical workforce does not understand its organizations’ strategy. — Balanced Scorecard Collaborative PROBLEMS THAT ALL COMPANIES FACE AND THAT BALANCED SCORECARD ADDRESSES BSC DESIGNER
  17. 17. 90% of organizations fail to execute their strategies successfully. — Balanced Scorecard Collaborative PROBLEMS THAT ALL COMPANIES FACE AND THAT BALANCED SCORECARD ADDRESSES BSC DESIGNER
  18. 18. 70% of organizations do not link middle management incentives to strategy. — Balanced Scorecard Collaborative PROBLEMS THAT ALL COMPANIES FACE AND THAT BALANCED SCORECARD ADDRESSES BSC DESIGNER
  19. 19. BALANCED SCORECARD ALLOWS ONE TO SEE THE BIG PICTURE
  20. 20. LINE-LEVEL EMPLOYEES start seeing the connection between what they are doing now and the strategy of the company. BALANCED SCORECARD ALLOWS ONE TO SEE THE BIG PICTURE BSC DESIGNER
  21. 21. EXECUTIVES enjoy the top view of what's happening in the company, why it’s happening and what is the response of the business on this. BALANCED SCORECARD ALLOWS ONE TO SEE THE BIG PICTURE BSC DESIGNER
  22. 22. ANALYZE YOUR LAST FAILURE
  23. 23. IF YOU WOULD HAVE EXECUTED IT BETTER IF YOU WOULD SEE A BIG PICTURE OF WHAT'S GOING ON? ANALYZE YOUR LAST FAILURE BSC DESIGNER
  24. 24. IF YOUR EMPLOYEES WOULD ACHIEVE BETTER RESULTS IF THEY WOULD HAVE KNOWN WHAT STRATEGIC PLAN STANDS BEHIND THEIR JOB? ANALYZE YOUR LAST FAILURE BSC DESIGNER
  25. 25. IF YOUR PROJECT WOULD BE MORE PREDICTABLE IF YOU WOULD USE CLEARLY DEFINED MEASURES AND KPIS? ANALYZE YOUR LAST FAILURE BSC DESIGNER
  26. 26. HOW EXACTLY CAN THE BALANCED SCORECARD HELP?
  27. 27. TO EXECUTE A BUSINESS STRATEGY EFFECTIVELY stakeholders need to see the big picture of what's happening in the business and why. Management initiatives should be aligned with strategy and we need KPIs to know that we are on the right track. HOW EXACTLY CAN THE BALANCED SCORECARD HELP? BSC DESIGNER
  28. 28. THE BALANCED SCORECARD obligates top managers to formalize their strategic ideas into a form of a strategy map. Business objectives should be linked with each other by a cause-and-effect connections. HOW EXACTLY CAN THE BALANCED SCORECARD HELP? BSC DESIGNER
  29. 29. With the Balanced Scorecard KPIs will be aligned to business objectives. We will know if we are on the right track towards achieving the business goal. HOW EXACTLY CAN THE BALANCED SCORECARD HELP? BSC DESIGNER
  30. 30. In the Balanced Scorecard for each business objective we will have an action plan. It will tell employees what they should do to achieve the specific business goal. HOW EXACTLY CAN THE BALANCED SCORECARD HELP? BSC DESIGNER
  31. 31. The Balanced Scorecard project will be cascaded. BSC project will be delegated to department levels. HOW EXACTLY CAN THE BALANCED SCORECARD HELP? BSC DESIGNER
  32. 32. YOU STILL NEED YOUR PROJECT MANAGEMENT TOOLS
  33. 33. The Balanced Scorecard is not a replacement for classical project management tools. The BSC addresses the strategy execution problems, not a task management challenges. YOU STILL NEED YOUR PROJECT MANAGEMENT TOOLS BSC DESIGNER
  34. 34. The Balanced Scorecard gives a business context for operational tasks. Instead of just doing their job, employees will be able to understand why they are doing it and why it is important. YOU STILL NEED YOUR PROJECT MANAGEMENT TOOLS BSC DESIGNER
  35. 35. Companies that have implemented the Balanced Scorecard have reported significant increases in ultimate business performance. The Balanced Scorecard allows changing the perception of the job. YOU STILL NEED YOUR PROJECT MANAGEMENT TOOLS BSC DESIGNER
  36. 36. 83% found the most significant impacts of Balanced Scorecard implementation in business actions. — 2GC Balanced Scorecard usage survey BSC DESIGNER
  37. 37. 80% of organizations using Balanced Scorecard reported improvements in operating performance. — Balanced Scorecard Forum BSC DESIGNER
  38. 38. 66% of these organizations reported an increase in profits. — Balanced Scorecard Forum BSC DESIGNER
  39. 39. A BALANCED SCORECARD AND A DASHBOARD ARE NOT THE SAME
  40. 40. Most businesses have some type of a dashboard. A dashboard and a Balanced Scorecard are not the same business tools. They are designed for different purposes. A BALANCED SCORECARD AND A DASHBOARD ARE NOT THE SAME BSC DESIGNER
  41. 41. Dashboards are great for monitoring of the current business state. Dashboards help to generate some business insights. A BALANCED SCORECARD AND A DASHBOARD ARE NOT THE SAME BSC DESIGNER
  42. 42. You will need a scorecard that will track your progress towards specified business objectives. Use the Balanced Scorecard when it comes to new challenges. A BALANCED SCORECARD AND A DASHBOARD ARE NOT THE SAME BSC DESIGNER
  43. 43. Learn more about the difference in the article: "What’s the difference between a Dashboard and a Balanced Scorecard?“ on www.bscdesigner.com A BALANCED SCORECARD AND A DASHBOARD ARE NOT THE SAME BSC DESIGNER
  44. 44. WHAT ARE THE BENEFITS OF THE BALANCED SCORECARD?
  45. 45. BSC FOR A TOP MANAGER Visualizes strategic information on the strategy map BSC DESIGNER
  46. 46. BSC FOR A TOP MANAGER Displays the big picture of what's going on in the company Helps to formulate and execute the strategy Visualizes strategic information on the strategy map Top manager have the understanding of the cause-and-effect connections between involved business objectives and suggested business solutions BSC DESIGNER
  47. 47. BSC FOR A BUSINESSS UNIT MANAGER Helps to monitor the current performance BSC DESIGNER
  48. 48. BSC FOR A BUSINESSS UNIT MANAGER Helps to monitor the current performance Helps to tracks the progress towards business objectives Visualizes important performance information Top level initiatives are translated more logically. Managers focus on what matters, and avoid a job that doesn't help the company to execute its strategy BSC DESIGNER
  49. 49. BSC FOR LINE-LEVEL EMPLOYEES Shows how the current task is linked to the company's strategy BSC DESIGNER
  50. 50. BSC FOR LINE-LEVEL EMPLOYEES Shows how the current task is linked to the company's strategy Tracks the current performance transparently Employees are happy to do a job where a final objective and the progress measures are clearly defined Knowing the ultimate goal helps employees to do their job more effectively BSC DESIGNER
  51. 51. BALANCED SCORECARD'S DON'TS
  52. 52. DO NOT RUN THE BSC PROJECT BY YOURSELF. Top managers like to play their business toys alone. In the case of the Balanced Scorecard this won't work. Involve your team as soon as possible. In this way you will come up with better KPIs, business objectives, action plans and finally will achieve better results. BALANCED SCORECARD'S DON'TS BSC DESIGNER
  53. 53. DO NOT USE REWARD KPIs. Linking rewards to specific KPI will make the life of HR much easier, but it is not recommended to use Reward KPIs on your scorecard. Researches and best practices also confirm this point of view. Check out "Compensation and reward KPI best practices" article on www.bscdesigner.com for details. BALANCED SCORECARD'S DON'TS BSC DESIGNER
  54. 54. DO NOT COPY KPIs FROM OTHER BUSINESSES. You need to map your business objectives and then come up with KPIs that will measure your progress towards business objectives or monitor your current performance. Business objectives come first, not KPIs. For that reason it doesn't make sense copying KPIs from others. BALANCED SCORECARD'S DON'TS BSC DESIGNER
  55. 55. WE ALREADY HAVE KPIs! WHY DO WE NEED ANYTHING ELSE?
  56. 56. KPIS ARE FOR MEASUREMENT, NOT FOR MANAGEMENT. They can give some insights, but they lack the connection with strategy, business objectives and action plans. — Learn more in the article: "Why most KPIs don't work and what to do about this." WE ALREADY HAVE KPIs! BSC DESIGNER
  57. 57. CHOOSING AN AUTOMATION TOOL
  58. 58. As it was shown the Balanced Scorecard is not about few KPIs and it is not for the top managers only. To help company execute its strategy, the Balanced Scorecard should be a part of the business toolkit of all departments. CHOOSING AN AUTOMATION TOOL BSC DESIGNER
  59. 59. Excel is a great choice when you are on the stage of a prototype. To help company execute its strategy, the Balanced Scorecard should be a part of the business toolkit of all departments. CHOOSING AN AUTOMATION TOOL BSC DESIGNER
  60. 60. When it comes to the strategy map, cascading, sharing your BSC, choose a professional Balanced Scorecard software like BSC Designer. BSC Designer you can link a KPI to your data in MS Excel. CHOOSING AN AUTOMATION TOOL BSC DESIGNER
  61. 61. Facts tell, stories sell. We shared many facts about the Balanced Scorecard. To be really persuasive one need to share stories about the Balanced Scorecard with their stakeholders. CHOOSING AN AUTOMATION TOOL BSC DESIGNER
  62. 62. CHOOSING AN AUTOMATION TOOL
  63. 63. CHOOSING AN AUTOMATION TOOL
  64. 64. CHOOSING AN AUTOMATION TOOL
  65. 65. CHOOSING AN AUTOMATION TOOL
  66. 66. CHOOSING AN AUTOMATION TOOL
  67. 67. 80 testimonials from users from various businesses from all over the world. — www.bscdesigner.com/about-us/testimonials CHOOSING AN AUTOMATION TOOL BSC DESIGNER
  68. 68. Business people like to see not just user's testimonials, but the case studies with even more facts and details. Share with your stakeholder one of the business stories from case study section on www.bscdesigner.com CHOOSING AN AUTOMATION TOOL BSC DESIGNER
  69. 69. STILL DOUBT ABOUT THE BALANCED SCORECARD?
  70. 70. Find more insightful articles about the Balanced Scorecard in ”Articles” section at www.bscdesigner.com MORE ABOUT THE BALANCED SCORECARD BSC DESIGNER
  71. 71. THANK YOU! Feel free to send us your questions using the contact form at www.bscdesigner.com

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