Balanced Scorecard Basics
Have you decided to deploy the Balanced Scorecard in your organization? If so, congratulations. You've just taken the first step in aligning your organization for success. But it's important to remember that deciding to deploy the Balanced Scorecard is just the first step on this journey. Throughout your travels, keep the following in mind:
- Stay focused on the strategy. The process of building the Balanced Scorecard is, for many organizations, the first opportunity to talk about strategy. As you're discussing strategy, however, make sure that you're actually focused on strategy, not tactics. When you get started building your strategy map, keep it at a high level and make sure your cause and effect linkages make sense.
- Keep it simple. Strategy is complex, but your Balanced Scorecard and Strategy Map should not be. Your strategy map especially should be a simple, clear representation of your company's strategy -- a picture that tells the story of your strategy. If you have over 50 objectives and you're using 4 point type, it's just not simple enough.
- Engage your leadership. While it's certainly tempting to sit at your desk and create the "perfect" Balanced Scorecard and Strategy Map, without leadership engagement and involvement, the strategy map will be nothing more than a pretty picture that you can frame and put on your wall. You may even be surprised at the insights your leadership time can contribute!
- Perfection is not your goal. Endlessly tweaking and "improving" your Strategy Map and Balanced Scorecard wastes precious time that could instead be spent on actually implementing your strategy. Get to your first report meeting as soon as possible -- even with an incomplete scorecard -- so that you can begin tracking how you're doing against your strategy.
- Don't be afraid of new measures. You've undoubtedly been tracking a number of measures for some time now, and some of these measures should show up on your Balanced Scorecard. Resist the urge, however, to use the Balanced Scorecard as just a resort of your existing measure framework. Toss out the measures that don't measure your strategy (or relegate them to operational meetings), and add new measures that will help you track your performance vs. your strategy.
- Iteration is your friend. Since you've heeded my advice and led your first report meeting within 60 days of starting the journey, and have used some new measures that you've never used before, you're going have to make some changes. Don't worry, it's the right way to use the Balanced Scorecard. Treat the first six months or so as a learning period, and make changes as necessary. Your strategy will thank you.
- Ask for help. There's huge community of Balanced Scorecard users out there -- at bscCommunity.com and elsewhere -- who can serve as resources for you. The only think we ask of you is to "pay it forward" when you're the BSC expert, and help others get started and productive with the Balanced Scorecard.
June 2021
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