Balanced Scorecard - Dashboard - Strategic Kaizen System - What is the current Information System like?
- Provides unreliable information for decision-making (Autopsies vs. biopsies) Does not show how the company creates value of the strategy
The importance of intangible assets
The ability of a company to mobilize and exploit its intangible and invisible assets has become much more
decisive than investing and managing its tangible and physical assets.
What is the Balanced Scorecard?
A Good Idea in 1992. "The Balanced Scorecard - Measure what motivates performance" (Harvard Business Review, 1992)
- It is a management methodology that allows communicating and implementing a strategy, making it possible to obtain results in the short and long term. From financial control to strategic control
What does the Balanced Scorecard do?
- Complements the financial indicators of past performance with inducers of future action Clarifies, translates and transforms the vision and strategy Communicates and links strategic objectives and indicators Identifies, plans and establishes strategic initiatives
What does the Balanced Scorecard look for?
- “In addition to translating the strategy and vision of an organization into a broad set of performance indicators, the Balanced Scorecard provides the necessary structure for a strategic measurement and management system.” “The BSC is used as a system of communication, information and training »" The BSC becomes a new way of managing its intangible assets based on strategy. "
Why is the Balanced Scorecard important?
The BSC is important because:
- When communicating the strategy, it seeks to achieve consensus on it. It allows aligning individual and departmental objectives with the strategy. It links short-term objectives with long-term objectives and annual budgets. It allows for periodic and systematic strategic reviews. It allows for feedback. to learn about the strategy, improve it and give feedback. How does the Balanced Scorecard work?
The BSC measures the organization's performance from four balanced perspectives:
- Financial aspectsCustomersInternal processes, Learning and growth
This does not imply that these only four perspectives must be
What is the correct approach to the BSC?
Wrong approach
- Set of financial and non-financial indicators Management system for management control of the organization Focused on the use of the computer tool. Thought more about software than content Focused on change, performance evaluation and compensation
Correct approach
- Coherent set of elements connecting actions with strategy Planning and management support system that facilitates communication and provides better information at all levels Content-focused. Software is a means, not an end in itself, focused on strategic goals and priority initiatives. Changes in evaluation and compensation are a consequence and not the raison d'être of the model.
VISION: Imaginative and encouraging description of the role and future objectives of an organization that significantly goes beyond its current environment and competitive position.
What is a Strategic Map?
Every strategy is a hypothesis, a prediction of the objectives that step by step contribute to achieving the desired effect. Hence the importance that prior to drawing the map the hypothesis on which the strategy will be based is clearly established.
The strategy cannot be applied if it is not understood and understood if it cannot be described. The BSC strategic map seeks to make the strategy hypothesis explicit, with an architecture that describes it and allows it to be communicated in a coherent, integrated and systematic way.
What is the financial perspective?
The financial perspective answers the question: How should we appear before our shareholders to be financially successful?
Financial objectives serve as a focus for objectives and indicators in all other BSC perspectives.
The indicators of financial performance indicate whether a Company's strategy, its implementation and execution are contributing to the improvement of the organization.
Answer this question based on the selected strategic topics
What is the Client's perspective?
The Client's perspective answers the question: How should we appear before our clients to achieve our vision and our financial objectives?
In this perspective, the customer and market segments in which they have chosen to compete are identified; these segments represent the sources that will provide the income component of the company's financial objectives and according to the value proposition.
What is the perspective of Internal Processes?
The perspective of Internal Processes answers the question: In which processes should we be excellent to satisfy our shareholders and clients?
From this perspective, the most critical processes are identified in order to achieve financial and customer objectives. Each Company has a unique set of processes to create value for customers and optimize financial results.
What is the Perspective of Learning and Growth?
The Learning and Growth perspective answers the question: How will we maintain and sustain our ability to change and improve to achieve our vision? The learning and growth objectives provide the infrastructure that enables the ambitious objectives to be achieved in the remaining three perspectives.
DASHBOARD MATRIX GROWTH
What are the Indicators?
- They are born from the definition of critical variables for each objective. Some indicators reflect the results of past performance (Lag measures) Other indicators describe what is done (performance inducers, Lead measures, Drivers), generally short term. The performance indicators and the results indicators form a chain in which the results of the lower level can be the performance indicators of the higher level.
What is the tracking?
Senior Management must, at planned intervals, review the Institution's BSC, to ensure its continued suitability, adequacy and effectiveness. The review should include evaluating opportunities for improvement and the need for change, including vision and goals. ISO 9000
Characteristics of a successful implementation
- Balance and cause-effect relationships between indicators: When cause-effect relationships cannot be verified, management must still have some idea of that relationship Goal setting: Goals should be set for each indicator and these should be consistent with the vision global and strategy. Have short-term goals (3 to 18 months) and long-term goals (2 to 5 years) Relations with existing systems: Must be in line with existing control systems such as budgets, reports, incentive systems, and ensure the viability of Indicators and measurements: Information must be current and relevant IT-based presentation and support systems: Linked to an IT-based presentation and support system, but not seen as a computer project Training and information: It must be easily affordable and understandable.
Development of a learning organization:
Participation, awareness and decentralization of decision-making and responsibility to achieve the goals that have been formulated must be developed. Draw conclusions about what you are doing well, what you are not doing well and what can be improved
Concept monitoring:
The strategy should be constantly reviewed. If it finally turns out that there is no correlation between the indicators and the strategic goals, that discovery indicates that the theories on which the choice of strategies is based should be re-examined.
Review the hypothesis
What are the risks with the BSC?
- Poor involvement of Management in the implementation project. Inadequate selection of indicators. Implementation with a strategy not yet clearly defined. Develop it based on a Software. Give importance only to the indicators and not to the strategy as a whole.
Bibliography
- Seminar with Robert Kaplan- Costa Rica June 2003 Seminar with d. Norton, August 2005 Integral Management: Jean-Paul Sallenave. Implementing and managing the Balanced Scorecard: Nils-Gorän Olve and others. The Balanced Scorecard: R. Kaplan, D. Norton. Towards a management system based on the strategy: BSC Lionel Sotomayor. Administration in a Page - Riaz KhademHow to get out of the crisis William E. Deming.Strategic Management Control: Phillipe Lorino.Understanding & Implementing ISO 9001: 2000 Standard: HJ Steudel Ass., ISO 9004: 2000, Recommendations for improvement of performance, ISOInteco.Guidelines for achieving Financial Benefits, ISO 10014: 98How to use the Balanced Scorecard, R. Kaplan, D. NortonWebsite: Dashboard, Argentina.Total Alignment, Riaz KhademThe HR Scorecard, Becker,HuselidThe Power of a Vision, Video by Joe BakerGuide for the implementation of indicator systems. UNE 66175
Other Kaizen Group seminars
- Workshop “Identification, analysis and validation of Indicators” Corporate Social Responsibility Integrated Management Systems (Quality, Environment, Risks) Implementation of ISO 9000 Quality Management Systems Implementation of ISO 14000 Environmental Management Systems Implementation of OHSAS 18000 Identification and Prioritization of Aspects and environmental impacts and Dangers and Labor risks Self-managed teams (Empowerment) Problem Solving Techniques Process Control under statistical methods Customer service Internal Service Culture (Negotiation Customer Internal Supplier) Program 5 "S" s
