American Red Cross Balanced Scorecard

2,857 views

Published on

Published in: Education, Business, Technology
0 Comments
4 Likes
Statistics
Notes
  • Be the first to comment

No Downloads
Views
Total views
2,857
On SlideShare
0
From Embeds
0
Number of Embeds
3
Actions
Shares
0
Downloads
75
Comments
0
Likes
4
Embeds 0
No embeds

No notes for slide

American Red Cross Balanced Scorecard

  1. 1. The American Red Cross: Performance Measurement Then and Now, and Applying the Balanced Scorecard By Bicky, Evgenii, Lavender, Natalie, and Sa
  2. 2. Overview • Balanced Scorecard Method • American Red Cross • Old Performance Measurement System • Description & Evaluation • New Performance Measurement System • Description & Evaluation • Recommendations & Applying the Balanced Scorecard
  3. 3. Presentation’s Objectives • WHAT the Balanced Scorecard is. • WHY it is an effective performance measurement tool • HOW the ARC makes use of the BSC. • HOW the organization‟s performance is measured with the BSC
  4. 4. What is Balanced Scorecard?
  5. 5. Balanced Scorecard History Measurement and Reporting 1992   2000 1996 Articles in Harvard Business Review:  Enterprise-wide Strategic Management Alignment and Communication Acceptance and Acclaim: “The Balanced Scorecard — Measures that Drive Performance” January - February 1992  “The Balanced “Putting the Balanced Scorecard to Work” September - October 1993  Selected by Harvard Scorecard” is translated into 18 languages “Using the Balanced Scorecard as a Strategic Management System” January - February 1996 1996 Business Review as one of the “most important management practices of the past 75 years.“ 2000
  6. 6. Before the Balanced Scorecard MISSION Why we exist VALUES What’s important to us VISION What we want to be STRATEGY Our game plan STRATEGIC OUTCOMES Satisfied SHAREHOLDERS Delighted CUSTOMERS Efficient & Effective PROCESSES Motivated & Prepared WORKFORCE
  7. 7. With the Balanced Scorecard Strategy Is a Step In a Continuum MISSION Why we exist VALUES What’s important to us VISION What we want to be STRATEGY Our game plan BALANCED SCORECARD Implementation & Focus STRATEGIC INITIATIVES What we need to do PERSONAL OBJECTIVES What I need to do STRATEGIC OUTCOMES Satisfied SHAREHOLDERS Delighted CUSTOMERS Efficient & Effective PROCESSES Motivated & Prepared WORKFORCE
  8. 8. Reasons to use BSC
  9. 9. Four Perspectives of the Balanced Scorecard
  10. 10. Learning and Growth Perspective • An organization's ability to innovate, improve, and learn ties directly to its value as an organization. • How can we continue to improve and create value for our services?
  11. 11. Business Process Perspective • Must focus on critical internal operations that enable the organization to satisfy customer needs. • To satisfy our shareholders, what business processes must we excel at?
  12. 12. Customer Perspective • Must know if their organization is satisfying customer needs. • To achieve our vision, how should we appear to our customers?
  13. 13. Financial Perspective • In the private sector, measure typically focused on profit and market share. • To succeed financially, how do we appear to our shareholders?
  14. 14. Financial Perspective
  15. 15. Perspectives & Performance Measurement CUSTOMER OBJECTIVE MEASURE FINANCIAL WEIGHT % BUSINESS PROCESS OBJECTIVE MEASURE WEIGHT % OBJECTIVE MEASURE WEIGHT % LEARNING & GROWTH OBJECTIVE MEASURE WEIGHT %
  16. 16. The Balanced Scorecard: Benefits • Sets clear goals, objectives, and measures across four critical areas • Creates interdependency and interrelationship of all four quadrants; balance is key • Provides leadership with the ability to build organizational consensus around its priorities; creates organizational clarity • Provides a vehicle that can hold staff and management accountable for their results in a clear and consistent manner • Can complement any existing strategic planning effort by clearly identifying and prioritizing performance benchmarks and targets
  17. 17. American Red Cross (ARC) • Nongovernmental, nonprofit organization whose purpose is to prevent and relieve human suffering • Has a mission of providing relief to victims of disasters and helping people prevent, prepare for, and respond to emergencies • Employees (13,000) and volunteers (875,000) • 850 Chapters
  18. 18. Two Performance Systems in Old Plan • Re-chartering: Chapters had to answer 33 yes/no questions. • Standard of Excellence: Designed to improved the chapter performance in the reach of fundraising, revenue per population, service level, and community potential
  19. 19. American Red Cross Strategic Plan • Be America‟s partner and a leader in mobilizing communities to help people prevent, prepare for, and respond to disasters and other life-threatening emergencies. • Inspire a new generation of volunteers and supporters to enrich our traditional base of support. • Strengthen our financial base, infrastructure, and support systems to continuously improve our service delivery system.
  20. 20. Two Types of Chapter Performance Standards in the New System • Core Requirements: Chapters should meet these basic requirements. • Critical Performance Standards: Fifteen out of thirty standards are mandatory. The chapters are evaluated on: - Chapters‟ past year performance - Comparison against the performance of its peers
  21. 21. Chapters Evaluation • Highly Performing Chapters: Meet all the core requirements and exceed both chapter performance standards. Awarded with “Recognition” • Successful Chapters: Meet all the core requirements and also meet and exceed the performance standards. • Provisional Chapter: Meet all the core requirements but lag behind in the Critical Performance Standards. • Charter Review Required: Chapters who fail one or more core requirements.
  22. 22. Evaluation of the New Plan • Ensures uniformity and meet minimum requirements. • 17 core requirements do not directly support the strategic plan • Critical Performance Standards good measure of evaluation.
  23. 23. Example Multiplier Performance Measurement 1 2 Percentage of fundraising expenses to related contribution 3 Disaster readiness level Percent of volunteers indicating ‘Excellent’ overall levels of satisfaction with their volunteer experience
  24. 24. Measures that differ? • Different scales • What is considered „good‟?
  25. 25. Measures that differ?
  26. 26. Actual Score ÷ Total PerformanceWeighted Score Total Weighted Score Score × Possible Weighted Score × 100 = Total Chapter Performance Score Performance Multiplier = Score Conclusions: •Hard to focus: too many measures; too many categories •Some measures don‟t drive strategy •Just components, no alignment g
  27. 27. Recommendations: Applying the Balanced Scorecard • Objectives need to drive strategy, and be aligned • Measures need to encourage objectives
  28. 28. Be America’s partner and a leader in mobilizing communities to help people prevent, prepare for, and respond to disasters and other life-threatening emergencies. Inspire a new generation of volunteers and supporters to enrich our traditional base of support Strengthen our financial base, infrastructure, and support systems to continuously improve our service delivery system
  29. 29. Example
  30. 30. Be America’s partner and a leader in mobilizing communities to help people prevent, prepare for, and respond to disasters and other life-threatening emergencies. Inspire a new generation of volunteers and supporters to enrich our traditional base of support Strengthen our financial base, infrastructure, and support systems to continuously improve our service delivery system
  31. 31. Example
  32. 32. Be America’s partner and a leader in mobilizing communities to help people prevent, prepare for, and respond to disasters and other life-threatening emergencies. Inspire a new generation of volunteers and supporters to enrich our traditional base of support Strengthen our financial base, infrastructure, and support systems to continuously improve our service delivery system
  33. 33. Example
  34. 34. Be America’s partner and a leader in mobilizing communities to help people prevent, prepare for, and respond to disasters and other life-threatening emergencies. Inspire a new generation of volunteers and supporters to enrich our traditional base of support Strengthen our financial base, infrastructure, and support systems to continuously improve our service delivery system
  35. 35. Example
  36. 36. Alignment of Objectives
  37. 37. Conclusion

×