How to sustain your scorecard program.

1. euseden
Our implementation
experience and
Sustaining the success of
interactions with
scorecard process
owners in more than 20
leading Indian
Scorecard
organizations, suggest
that it takes a lot more
than first scorecard and
initial enthusiasm to
hard-wire the scorecard By Sheshagiri G Hegde
into the organization Director Euseden- Strategy & Scorecard practice
M any leading, large Indian companies have implemented balanced
scorecard in their organizations. Over the years, we have been interacting
with majority of these organizations at various levels. Some of these
scorecard initiatives are facing serious problems in terms of making the
scorecard as a strategy management process. In majority of these
organizations, they have done the strategy map, prepared the scorecard,

2. EUSEDEN Sustaining The Success Of Scorecard 2
set the targets, and have identified the initiatives but,
START AT THE TOP
after all that the scorecard has stopped. Clearly there
are signs that the scorecard is no more taken Scorecard is best implemented top-down. Remember,
seriously. In regular operational reviews, the Scorecard is strategy execution system, hence to have
scorecard is referred to for explaining few points etc, strategic impact, it needs to start with strategy at the
but for sure; it is not a living management process. In top and should originate from there. Moving down is a
simple terms their scorecard program is headed no lot easier than moving up. Barring few companies,
where. Question is, why and how well intended most of the companies where BSC (Balanced
scorecard process did not go beyond the first scorecard) had transformational impact on the
scorecard? organizations, have started their scorecard program at
the top. Taking bottom-up initiatives requires distinct
There are many other firms however, who have done skills set from those who initiate and from the
very well with their scorecard programs and have organization itself. Especially the organizational culture
benefited tremendously from it. Tata Motors has been plays vital role in making successful local initiatives into
the hall of fame case. As we know, Tata Motors has organization wide initiatives.
been able to turn-around its performance due to their
scorecard initiative. Almost all the Tata group
companies since then have implemented scorecard.
India’s largest selling beer brand Kingfisher also has
implemented the scorecard very successfully. In matter
Without a
of just 12 months, UB doubled its EBITDA and grew at
a rate twice faster than its competitor, SAB miller. UB
systematic
group also has since then implemented balanced
scorecard in many of the group companies.
approach, the
Why scorecard is successful in some of the companies scorecard may not
and not so successful in many others? How can the
scorecard initiators make sure that the Initiative has have its full impact
powerful impact on the companies’ financial
performance? Our experience in implementing the
scorecard in many large companies, suggest that the
initiators need to take certain steps to make sure the
program really becomes successful and has maximum
impact on the organization’s performance.

3. EUSEDEN Sustaining The Success Of Scorecard 3
In a retail chain that we know of, first, the HR
professionals attempted implementing balanced
INVOLVEMENT
scorecard at store level. They helped few (3-4 stores
across different cities) enthusiastic and high-performing
OF TOP
store managers implement store level performance
measurement system, which was based on the
MANAGEMENT is
balanced scorecard principles. The HR gave them good
deal of support in terms of initial design of template etc.
very key to the
In all the select stores the scorecard was developed and
store managers trained their crew on these measures.
success of the
As reported by the stores managers these were quite
successful. According to these managers the scorecard
scorecard
did really have impact on the behavior of the crew
members, how they treated the customers, kept stock
level, etc. the senior operations managers were seeing it very
differently and said this was not feasible organization-
Was it then implemented in all stores? Did it have wide for XYZ reasons. Over time HR people realized
organization-wide performance impact? that they were dead against the wall.
Not really. Though HR carried these success stories to But then, what options do we have as scorecard
the corporate, the middle managers and even some of initiators, if we cannot start at the top? The next best
the senior operations managers were seeing it very thing is to see if we can start at the BU level. Start with
differently and said this was not feasible organization- a high-rank BU top team and see if the Scorecard
wide for XYZ reasons. Over time HR people realized program can be started at that level. We however,
that they were dead against the wall. strongly recommend starting the initiative at the top of
But then, what options do we have as scorecard the organization.
initiators, if we cannot start at the top? The next best
thing is to see if we can start at the BU level. Start with a
PLAY THE OPENING VERY WELL
high-rank BU top team and see if the Scorecard
Right beginning moves, ensures long-term success.
program can be started at that level. We however,
Structured approach still is the best for success.
strongly recommend starting the initiative at the top of
Exhibit 1 – explains typical distinct phases of the
the organization.
process of Scorecard initiative in large organizations.
This is typically the progress-path the successful
Was it then implemented in all stores? Did it have
implementers of BSC have taken. We need to be
organization-wide performance impact? Not really.
careful at phase-1 and at the beginning of phase 2. At
Though HR carried these success stories to the
this stage, Scorecard initiative has not yet taken
corporate, the middle managers and even some of

4. EUSEDEN Sustaining The Success Of Scorecard 4
Exhibit 1
For making the scorecarding process successful and highly sustainable it is very important that the scorecard initiators manage the Phase 1 really well.
This builds proper foundation for the activities that follows in future and help the scorecard to have maximum impact on the organizational performance
Following diagram explains a generic, high level road map of becoming fully mature balanced scorecard organization. Based on our experience in
scorecard implementation with many organizations, we believe that there are four distinct phases of balanced scorecard implementation. In phase 1,
executives generally build the case, sensitize and educate the top leadership team, build first scorecard etc. In phase 2 the corporate level scorecard is
cascaded down the organization to business/operating organizational units. In phase 3 support functions build their scorecard and review of scorecard
becomes way of life. In phase 4 the scorecard is moved to the frontest lines of the organization and the scorecarding becomes a way of managing
Fine tune the
Manage with utmost care Clarify & educate process
Phase 1 Phase 2 Phase 3 Phase 4
[+] Sensitize leadership team [+] Cascade guidelines [+] Manage initiatives [+] Scorecard to frontlines
[+] Build business case [+] Document scorecard [+] Train top 15% on scorecard [+] Link to individual performance
[+] Develop strategy map [+] Educate BU team [+] Support function scorecards [+] Communicate scorecard
[+] Develop corporate scorecard [+] Develop BU/OU scorecards [+] Review and approve [+] Scorecard process team
[+] Identify the initiatives [+] Review & approve [+] Scorecard communication [+] Reporting & review process
[+] Allocate budget for scorecard [+] Conduct first review [+] Conduct first BU Reviews [+] Automate scorecard
[+] Scorecard implementation plan [+] Link to budgeting [+] Monitor scorecard process [+] Scorecard as a process
enough momentum to be self-sustainable. It requires -members are sold on the concept of balanced
careful management. Any type of short-cut in this stage scorecard. It is important they understand how exactly,
can short-circuit the entire initiative and can make the and in which ways
steps that follow harder and eventually bring the entire -Educate them on the scorecard; methodology,
initiative to a halt. Remember it’s like nursing baby. Your templates, best practices, processes, tools etc. They
time now, helps you later when it grows into a man or need not be experts at all this, but they need to have
woman. strategic overview of all these.
Taking care means following -Hire a proven consultant unless you as initiators have
-Do not prepare the strategy map in a laboratory of 2-3 had such experience in the past. Money saved here
young brilliant MBAs or consultants, and try handing it might cost the entire initiative later. Problem is, it will be
over to the team of managers to implement it. Scorecard too late when you realize this.
does not work that way.
-As far possible, get every top team member on board.
Do not hurry. Patience now pays later
-Build a powerful business case. Even if your top team

5. EUSEDEN Sustaining The Success Of Scorecard 5
START CONDUCTING REVIEWS
One of the key indicators of whether or not the
Scorecard program is going to be successful, is the
Scorecard review. How many strategy reviews are
conducted at top team level is powerful indicator of long-
term success of the scorecard management process.
Scorecard is not just a set of measures to be reported. It
is a template for action. Measures are important
indicators of such action. But that does not capture all
the essence of the real usefulness of the Scorecard
Program. The real value of the Scorecard is in its entire
process, and its ability to prompt action at all levels. The
actions which are coordinated, integrated, aligned and
directed towards creating high impact. The review brings
all this essence of the information. In fact review is a
significant part of the entire process itself. Review is
essential to the long-term success of the program.
In one company, where we implemented the Balanced
Scorecard, the CEO started reviewing the Scorecard in
their monthly operational review meetings with focused
two-hours dedicated to Strategy review. This was
followed by exclusive ½ day review on quarterly basis
and exclusive 2-day annual review. This way he was
making sure every one was paying significant attention
to the Scorecard activities and targets.
Also, following anecdote can help capture the essence.
In one of the large Indian retail companies, exactly 60
days after the Scorecard was prepared, the CEO of the
Company sent an e-mail to his executives saying that
there will be strategy review for ½ day on a particular
day. This e-mail was circulated to 12 members who
were part of the top level Scorecard building. This
prompted a lot of action in the following two weeks. In
the review meeting, however, it was clear that about
60% of the people had not worked on the Scorecard.
That is very large number! However, about 2-3 people
had done substantial work. They presented them with

6. EUSEDEN Sustaining The Success Of Scorecard 6
with nicely prepared power point presentations. The
CEO thanked them for the good progress and in fact, the
whole discussion was about the progress they made.
This sent an important signal to the entire team.
Especially to those who were at the next level of
management. By the second review, people were
collecting data, reporting on important progress made,
making presentations on the progress made on their
part and their side of the organization, albeit some data
missing. Point is, review gives the Scorecard a sense of
progress and helps to make progress. Otherwise,
Data or no data
people will take it lightly and everything will in the end
lose steam. Most importantly it frustrates those
start the review
managers who work hard and want to implement such a
system. They cannot implement this in vacuum. They
process
need their other colleagues to move so that they can We regularly come across situations where the scorecard process
owners are hesitant to start the review of the scorecard because they
move. Hence, eventually every one needs to be think they do not have enough data. In our opinion, it is more
important to conduct the review with whatever data on hand, than
onboard. waiting for the right amount of data. Discussion and some qualitative
data the members bring itself, will be worth the effort. As we have
In UB kingfisher, India’s largest selling beer brand, after seen, by the end of 2-3 such reviews, people will eventually come
with good deal of data.
the scorecard was prepared at the top and implemented
at key functions level, the scorecard was cascaded to all
the manufacturing plants (breweries). UB Scorecard
process team, covered about 30-40 plants across India
in the initial stage. All the plants prepared the scorecard
and started implementing the scorecard at their plant
level. The atmosphere was so charged that just three
months down the road all the plant managers were
informally, on their own, reporting on their progress, on
their key initiatives etc. Some of them were very eager
to share the progress they made with the corporate
balanced scorecard team. In some cases we received
complaints that their bosses were not paying enough
attention to the scorecard initiatives! Point is, when
people make progress they would want to know where
they stand against the others who have worked and it is
an important thing. A good review helps in providing
such an opportunity.

7. EUSEDEN Sustaining The Success Of Scorecard 7
Scorecard is not rocket science, but it is a
EDUCATE THE TOP TEN MEMBERS
comprehensive body of knowledge and requires some
ON THE SCORECARD effort to learn the frame work, template and the method.
METHODOLOGY It is quite a new and innovative methodology hence it
requires certain new perspective-learning. As far as the
This is one of the most ignored part of the Scorecard
executive leaders are concerned, they do not need to be
program. A successful implementation requires that all
black-belts of the Scorecard, but they need to have the
key executive leaders; say the top-ten management
big-picture of the process and what it takes to drive
team members plus other key executives at the next
down this initiative. Especially so if the top team is new
level understand the Scorecard methodology absolutely
to the initiatives of such kind.
right. In our opinion, this is very critical factor for the
It is easier said than done. How can you make such
entire scorecard journey. In fact it is the single largest
busy people learn a new methodology?
success factor of long-term success of the balanced
The following can help:
scorecard initiative. They need to be clear about how it
-Expose them to the Scorecard multi-media (1-2 hours)
needs to be cascaded down and what kinds of
briefings
resources are needed to drive the Scorecard down the
organization.
SCORECARD TRAINING STRATEGY AT UNITED BREWERIES
High priority Medium priority
Self study Series of Series of Brief on company Scorecard print manual
Custom prepared 3-4 Custom prepared 3-4 Strategy & scorecard
Pager executive briefs Pager executive briefs
Series of
Custom prepared 3-4
Scorecard print manual Scorecard print manual Pager executive briefs
Access to scorecard
1 hour multi media Custom elearning Best practice library
1 hour multi media
eEducation & presentation
presentation course Case-studies
Multi-Media 15-20 minutes multi Full fledged eLearning
Full fledged eLearning Full fledged eLearning
course on scorecard Media course on course on scorecard
course on scorecard How to prepare their methodology
methodology methodology
scorecard
1 day training cum Presentation cum
workshop 3-Day training /workshop
90 mins presentation Training By their
On balanced scorecard
immediate managers
Formal Class-room On scorecard method methodology
Training
Top Management Next 100 Frontline Scorecard
Managers Process Team

8. EUSEDEN Sustaining The Success Of Scorecard 8
-Conduct ½ day training on the Balanced Scorecard
-We at Euseden, also have our own proprietary
method
implementation model for Balanced Scorecard.
-Sponsor them to Scorecard seminar
However, all this needs to be customized for the
-Prepare a 20-25 pager Scorecard briefing kit custom-
Company’s unique needs. Example, Robert Kaplan
developed for your industry and -your company in
model suggests three workshops. This may not be
particular
possible for some companies due to the geographical
-Buy e-learning licenses of Scorecard Programs or
spread. In our practice, we have found this very difficult
prepare a custom this can help -powerfully
to follow as most of the executive leaders find it hard to
When do we know that the executive leaders are
devote so much time. They may not have so much time
informed and educated enough? In our engagements,
to spend. In such cases things have to be planned
we generally prepare a custom-reading-brief targeted to
keeping in mind such constraints.
the executive leaders. Ask the leaders to take our 2-3
hour e-learning. Then we insist that executives score
passing cut-off score minimum before we start the
Scorecard building. In fact, we have found it useful
practice to publish the highest score data online. This
we have found promotes executives to read the entire
course properly and builds healthy attitude towards
learning.
DEVELOP A CLEAR
IMPLEMENTATION PLAN
Proper project plan can help in scorecard
implementation in a big way. Project plan will help
envisaging the entire Scorecard initiative in one line of
sight view. This line-of-sight view will help in terms of
follow-up actions after each significant Scorecard
milestones.
Preferably, this plan needs to be prepared with the help
of someone who has prior experience in implementing
the Scorecard. There are templates available for
Scorecard implementation. This, however, needs to be
significantly customized to the requirements of your
company. In their book, Robert Kaplan and David
Norton have suggested ten-step generic implantation.
We at Euseden, also have our own proprietary
implementation model for Balanced Scorecard.
However, all this needs to be customized for the

9. euseden
Euseden is a strategy consulting
boutique based out of Bangalore India.
Over last five years we have helped
several Indian leading companies in
improving their business performance.
CONTACT
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www.euseden.com