Emea BSC PDF

Balanced Scorecard Institute - EMEA
International Balanced Scorecard

Certification Master Class
Introduction to Balanced Scorecard Institute EMEA
10 Steps Execution Success ProcessTM (XSP)
and communicate a program of action to execute strategy.

Strategy Map!
Balanced Scorecard!
Theme: Operating Efficiency

Financial!
Profits &
RONA
Grow
Revenues
Customer!
Fewer
Planes
Attract & Retain

More Customers
On-time
Service
Internal!
Learning!
Lowest
Prices
Fast Ground
Turnaround
Objective
Initiative
Budget
Profitability"
Market Value"
30% CAGR"
Grow revenues"
Seat Revenue"
20% CAGR"
Fewer planes"
Plane Lease Cost"
5% CAGR"
Flight is on-time"
Lowest prices"
Customer Loyalty
Program"
"
$XXX
"
Attract and retain

more customers"
#1
"
#1"
70%"
Increase
12% annual"
FAA On-Time Arrival

Rating"
Customer Ranking"
# Repeat Customers"
# Customers"
Fast ground
turnaround"
On Ground Time"
30 Minutes"
On-Time Departure"
90%"
On Ground Cycle
Time Optimization"
Quality
Management
$XXX
"
$XXX
"
% Ground Crew
Stockholders
100% "
ESOP
"
$XXX
"
Strategic Awareness
100%"
$XXX"
Strategic Job
Readiness
Yr 1 - 0%
Yr 3 - 90%
Yr 5 - 100%
"
100%
"
Ground Crew
Training
"
Crew Scheduling
System Rollout
"
CRM System"
Ground crew aligned

with strategy
Develop the
necessary skills
"
Develop the support
system
Strategic Job
Ramp Agent
Target
Ground Crew
Alignment
Strategic Systems
Crew Scheduling
Measurement
Action Plan!
"
"
Info System
Availability"
Communicate
Measure
Balanced Scorecard Institute -EMEA
www.balancedscorecard.co.uk
Total Budget!
$XXX"
$XXX"
$XXXX!
Execute
info@balancedscorecard.co.uk
I-2
I-3
A portfolio of strategic initiatives should be developed for each

theme.
I-4
Formal Strategy Execution Process

(Based on Dr Kaplan & Norton Book- The Execution Premium)
Stage 1
Clarify our strategy into

operational and measureable
terms
Set our strategic priorities
Develop the
Strategy
Stage 2
Translate the
Strategy
Align the organization to our

strategy and motivate
employees to help execute
Respond to shifts in our

environment and the
affects of our strategic
choices
Stage 6
Test and
Adapt
Stage 5
Stage 3
Align the
Organization
Monitor and
Learn
Check our progress and

revise our strategy as part
of a continual process
Stage 4
Allocate resources
through operating plans
and budgets that are
explicitly linked to
strategy
Link to
Operations
Execute
Initiatives
Processes
Conduct ongoing
operations and
discretionary projects
I-5
Balanced Scorecard Institute EMEA

10 Steps Execution Success Process (XSP)
Clarify strategy into

operational and
measurable terms
Align the
organization to
strategy and
motivate
employees to help
execute
DEVELOPING
Step 2
Align
Organizational
units to achieve
corporate
synergies
Step 4
DEVELOP
Step 1
STRATEGY
STRATEGY
MAPS
Evaluate the strategy
Step 10
DEVELOPING
Step 3
Develop a customer
focused strategy
SUPPORT AND LEAD

TRANSFORMATIONAL CHANGE
BALANCED
Strategy Map
Balanced Scorecard
StratEx
SCORECARD
ALIGN
SCORECARD
TO
DEPARTMENTS
Align
employees to
the strategy
Step 5
Step 9
results
Strategy Map
Balanced Scorecard
StratEx
CASCADE
SCORECARD
TO
INDIVIDUALS
& UPDATE
Step 8
STRATEGY
CREATE NEW STRATEGY

MANAGEMENT OFFICE
performance
measures
EVALUATE
results
Review strategy
implementation
REVIEW
& MONITOR
Step 7
EXCECUTION
LINK
STRATEGY
TO
OPERATIONS
Step 6
Respond to shifts in
the environment and
the affects of the
strategic choices
Developing the Strategy

Developing the Balanced Scorecard
Framework
Driving Organizational Synergies
Achieving Organizational Excellence
Sustaining High Performance over the long term
I-6
Module I - Introduction
Module Map
Module I.0:
Module I.1:
Module I.2:
Welcome About
Balanced Scorecard
Institute EMEA
Balanced Scorecard
Institute EMEA Value
Proposition
Balanced Scorecard
Institute EMEA Strategy
Management Approach
and
Balanced Scorecard
Institute EMEA Execution
Success Process TM XSP
I-7
I.0 Welcome About Balanced Scorecard Institute EMEA
Module I.0:
Module I.1:
Module I.2:
Welcome About
Balanced Scorecard
Institute EMEA
Balanced Scorecard
Proposition
Balanced Scorecard
Management Approach
and
Balanced Scorecard
\
I-8
Welcome!
We welcome
1. Name, Organisation, Position
2. Expectations
Benefits for you include
Participating in the course:
Learning is fun!
Networking
Preparation for the
Certification Exam
I-9
Balanced Scorecard Institute EMEA Overview
BSCi EMEA is the regional leader in

helping organizations execute their
strategies to achieve outstanding results.
Based on materials and methodologies
by Balanced Scorecard creators - Drs.
Robert S. Kaplan and David P. Norton
Dr. Kaplan
Mission:
BSCi EMEA mission is to help our clients address
their most challenging and complex strategy
execution issues.
Vision:
We will be the most respected and recognized
regional firm in the Strategy Execution market,
known for our best-in-class strategy execution
expertise.
Dr. Norton
Services Include:
Consulting
Conferences
Education
Technology
I - 10
Executing Strategy: The #1 Issue
I - 11
Four Barriers to Strategy Execution

The Vision Barrier
Only 5% of the workforce
understand the strategy
The People Barrier
The Management Barrier
9 of 10 companies
fail to execute strategy
Only 25% of managers have

incentives linked to overall
strategy
85% of executive teams

spend less than one hour
month discussing strategy
The Resource Barrier

60% of organizations do not
link budgets to strategy
Today s management systems were designed to meet the needs of stable

industrial organizations that were changing incrementally
You can t manage strategy with a system designed for tactics
I - 12
I.1 Balanced Scorecard Institute EMEA Value Proposition
Module I.0:
Module I.1:
Module I.2:
Welcome About
Balanced Scorecard
Institute EMEA
Balanced Scorecard
Proposition
Balanced Scorecard
Management Approach
and
Balanced Scorecard
\
I - 13
Balanced Scorecard Institute EMEA Services

Strategy Design
Formulate strategy with a highly deductive, client driven approach designed for successful
execution.
Strategy Management
Build the capability to translate strategy, align the organization, measure and report
performance and efficiently deploy resources to achieve breakthrough results.
Innovation
Identify and deploy new business models and develop new, highly differentiated ways to
engage stakeholders and customers through innovation of key interactions and experiences.
Leadership and Change Management
Assist leaders (directors, executives, managers) to enhance their capabilities to execute

strategy through coaching, mentoring and effective change processes that help eliminate
internal barriers to successful execution.
Operational and Information Excellence
Identify, understand, and manage the critical drivers of operational performance and build the
appropriate governance, reporting and information management disciplines to drive better,
faster and more accurate decision making.
Risk and Governance

Improve the management and measurement of enterprise, strategic and operational risk, and
Board and executive governance.
I - 14
Another Framing of Strategy Execution
Execution
Right
Wrong
Better than
anyone
would have
expected
Stunning
victory
Unmitigated
disaster
Profound
disappointment
Wrong
Right
Strategy
Thing
Balanced
Scorecard
Institute EMEA s
purpose is to
help our clients
achieve
stunning
victories
Adapted from The MacIntosh Way, Guy Kawasaki
I - 15
Balanced Scorecard Institute EMEA Framework Results

Independent research demonstrates that companies using
Balanced Scorecard Ins5tute EMEAs frameworks achieve 27% greater
growth in shareholder value over a three year period than
non-Balanced Scorecard users
51%
50%
40%
27%
The
Execution
Success
30%
20%
24%
10%
Time of
Investment
Control
Firms
BSC
Firms
Sample: 164 Publicly Traded Firms

Source: The eects of adop2ng the Balanced Scorecard on shareholder
returns,
Aaron Crabtree and Gerald DeBusk, Advances in Accoun2ng, June 2008
Balanced Scorecard Institute EMEA s

frameworks help companies realize improved
execution of value creation strategies
through:
Alignment throughout the organization of
objectives and initiatives with the strategy
Better visibility into performance drivers and
improved measurement of leading indicators of
performance
More explicit internal accountability for execution
Faster identification and correction of
performance issues
Improved confidence that:
The strategy is appropriate
The management team is capable
Execution is happening
I - 16
Balanced Scorecard Institute EMEA Framework Results

BSC Hall of Fame Organizations have achieved even greater improvements

in shareholder value
3 Year Increase in Shareholder Value
225%
51%
24%
No BSC (1)
BSC Users (1)
Sources:
(1) Crabtree DeBusk (2008)
(2) Balanced Scorecard Ins5tute EMEA Research
BSC Hall of Fame

Organiza5ons (2)
I - 17
Linked Left Brain, Right Brain Approach to Drive a

Comprehensive Execution Program
Left Brain Activities:
Planning: Determining and assigning:
What are we going to do?
Stakeholders
Board
Elements of the integrated planning

process:
Converting integrated plans into

comprehensive execution :
CEO
Strategy-driven planning using XSP

framework
Scenario development and testing to
understand uncertain future
Business model innovation to drive
new consumer driven mindset
SBU
Right Brain Activities:

Execution: Realizing the
objectives of the plan
Systematic change management

program
Organization alignment and
mobilization
Communication and participation
strategies
Corporate
Group
Division
SBU
SBU
SBU
SBU
Employees
I - 18

operational and
measurable terms
Align the
organization to
strategy and
motivate
employees to help
execute

DEVELOPING
Step 2
Align
Organizational
units to achieve
corporate
synergies
Step 4
DEVELOP
Step 1
STRATEGY
STRATEGY
MAPS
Step 10
DEVELOPING
Step 3
Develop a customer
focused strategy
SUPPORT AND LEAD

BALANCED
Strategy Map
Balanced Scorecard
StratEx
SCORECARD
ALIGN
SCORECARD
TO
DEPARTMENTS
Align
employees to
the strategy
Step 5
Step 9
results
Strategy Map
Balanced Scorecard
StratEx
CASCADE
SCORECARD
TO
INDIVIDUALS
& UPDATE
Step 8
STRATEGY
CREATE NEW STRATEGY

MANAGEMENT OFFICE
performance
measures
EVALUATE
results
Review strategy
implementation
REVIEW
& MONITOR
Step 7
EXCECUTION
LINK
STRATEGY
TO
OPERATIONS
Step 6
the environment and
the affects of the
strategic choices

Framework
I - 19
The Balanced Scorecard Institute EMEA Strategy Management Approach is

built upon a consistent philosophy of management
The Balanced Scorecard Institute EMEA Strategy Management System
Balanced Scorecard Institute EMEA XSP
An Integrated
Management
System
The Balanced Scorecard Management Philosophy

A Philosophy of
Management
1.
MOBILIZE: Executive Leadership to Mobilize Change
2.
TRANSLATE: Translate Strategy to Operational Terms
3.
ALIGN: Align the Organization to the Strategy
4.
MOTIVATE: Make Strategy Everyone s Job
5.
GOVERN: Make Strategy A Continual Process
The Balanced Scorecard Value Creation Model
An Economic
Model of Value
Creation
Four measurement
perspectives balance lag
and lead indicators
Measures and targets
define performance gaps
Strategic initiatives close
performance gaps
Strategy is
A hypothesis of value creation
Multiple complimentary themes
A customer value proposition
Alignment of business
processes
Readiness of intangible assets
I - 20
I.2 Balanced Scorecard Institute EMEA Strategy Management Approach
and Balanced Scorecard Institute EMEA 10 steps Execution Success
Process TM - XSP
Module I.0:
Module I.1:
Module I.2:
Welcome About
Balanced Scorecard
Institute EMEA
Balanced Scorecard
Proposition
Balanced Scorecard
Management Approach
and
Balanced Scorecard
Success Process TM - XSP
I - 21

operational and
measurable terms
Align the
organization to
strategy and
motivate
employees to help
execute

DEVELOPING
Step 2
Align
Organizational
units to achieve
corporate
synergies
Step 4
DEVELOP
Step 1
STRATEGY
STRATEGY
MAPS
Step 10
DEVELOPING
Step 3
Develop a customer
focused strategy
SUPPORT AND LEAD

BALANCED
Strategy Map
Balanced Scorecard
StratEx
SCORECARD
ALIGN
SCORECARD
TO
DEPARTMENTS
Align
employees to
the strategy
Step 5
Step 9
results
Strategy Map
Balanced Scorecard
StratEx
CASCADE
SCORECARD
TO
INDIVIDUALS
& UPDATE
Step 8
STRATEGY
CREATE NEW STRATEGY

MANAGEMENT OFFICE
performance
measures
EVALUATE
results
Review strategy
implementation
REVIEW
& MONITOR
Step 7
EXCECUTION
LINK
STRATEGY
TO
OPERATIONS
Step 6
the environment and
the affects of the
strategic choices

Framework
I - 22
Why the Balanced Scorecard Institute EMEA Approach is the Framework of

Choice for Strategy Management?
% of Organizations Using This Framework
q
Dominant Market
Penetration
q Intellectual Roots
Framework
The Balanced Scorecard
None (Customized)
Total Quality Management
q It Works
q Executive
Testimonials
62%
15%
Baldrige (7)
Six Sigma (5)
EFQM (1)
Shareholder Value (EVATM)
13%
3%
Other
7%
Value Dynamics / Accenture (1)

PWC (1)
Etc.
10
20
30
40
50
60
70
* Scorecard Best Practices; Lawson, Hatch, Desroches; Wiley 2008
I - 23
Balanced Scorecard is One of the Most Important Management Ideas of

the 20th Century
In 1997 HBR identified the Balanced Scorecard as
one of the most important ideas in the past 75 years.
In June 2012, the Balanced Scorecard Report marked

the 20th anniversary of the Balanced Scorecard.
I - 24
Balanced Scorecard is One of the Most Important Management Ideas of the

20th Century
Bain & Company s 2011 Management Tools and Trends survey reveals widespread use of the
Balanced Scorecard:
for 2010 Balanced Scorecard ranked #6 among the top 10 most used management tools
the Balanced Scorecard is used across companies of all sizes and usage is forecasted to
grow
2010 Top Management Tools
BAIN & COMPANY
Management Tools &

Trends 2011
By Darrell Rigby and Barbara Bilodeau
1.
Benchmarking
2.
Strategic Planning
3.
Mission and Vision Statements
4.
CRM
5.
Outsourcing
6.
Balanced Scorecard
7.
Core Competencies
8.
Change Management Programs
9.
Strategic Alliances
10. Customer Segmentation
I - 25
The Balanced Scorecard is the Dominant Approach to Comprehensive

Performance Management
q Dominant Market
Penetration
q
Intellectual Roots
q It Works
q Executive
Testimonials
q One million books sold
q 22 languages
I - 26
Why the Balanced Scorecard Approach is the Framework of Choice for

Strategy Management?
q Dominant Market
Penetration
Research studies show that Balanced Scorecard

users create dramatically higher levels of shareholder
value for their organizations
Three-year post-adoption performance ( Buy and Hold Returns ) of matched BSC firms vs.
control firms
BSC Firms
(mean)
Control Firms
(mean)
Difference
q Market value of equity
50.72%
23.60%
27.12%
q Book to Market
39.14%
8.97%
30.17%
q Net Assets
41.05%
13.47%
27.58%
q Average 3-Year Buy

and Hold Returns
43.6%
15.4%
28.2
Matching
Criteria
q
It Works
q Executive
Testimonials
Sample: 164 publicly traded firms

Reference: The effects of adopting the Balanced Scorecard on shareholder returns, Aaron
Crabtree and Gerald DeBusk, Advances in Accounting, June 2008, Elsevier
(www.elsevier.com)
I - 27
Balanced Scorecard Users are Successful Organizational Results

Demonstrate BSC Impact
Banco Estado Microempresas [BEME], Chile
From 2003-2008:
EBITDA rose from $5M to $16.2M
Loan placement went from $120M to $650M
BEME s customer base tripled
Dubai Electricity & Water Authority [DEWA], UAE

From 2000-2007:
Revenues more than doubled from AED 2.7B to AED 6B
Customer Satisfaction increased 10% to 95%
Infosys Technologies, India

From 2003-2007:
Revenue jumped 310%, operating income grew 289%
Earnings per Share went from $0.37 to $1.50 a 305% gain
Number of active clients rose from 293 to 500
Nemours, US
Revenues increased from 6.4% from 2006 to 2007

Achieved a breakthrough increase of 10% in patient satisfaction
Calls to make doctor appointments rose 30%
City of Corpus Christi, Texas, US
From FY 2006-2007 to FY 2007-2008:

Service reliability & speed improved avg. caller wait time decreased from 38 to
31seconds, then to 19 seconds by 4/09
Expenditures as a % of budget fell from 94% to 89%, then to 82% by 4/09
I - 28
Some Executive Perspectives: Why We Need A Management Platform
q Dominant Market
Penetration
q It Works
Executive
q
Testimonials
The BSC is much more than just a goal setting and

measurement device. Its a common language and even an
element of our corporate culture.
Sergey Leontiev
CEO
Financial Group Life, Moscow
We have used the Balanced Scorecard to keep a clear focus on
our strategy and the role every employee plays in achieving
high levels of performance. It has transformed our culture.
Ralph Izzo
CEO
Public Service Electric & Gas Co.
We came looking for measures and found a new way to
manage.
Peter Aldrich
CEO
HSBC Rail
I - 29
Types of Misalignment
Competing Goals
Lack of Direction
The organization lacks a vision of
what it wants to be; everyone
does what they believe is best
Different communities within

the organization disagree about
vision and strategy
Disconnected Leadership
Leadership has a vision and strategy but
has not communicated it to the rest of the
organization
The Wrong Goal

The organization is united in a
direction which does not create
value for shareholders
I - 30
Why does BSC Work?
Two words
Focus
Alignment
I - 31
ALIGNMENT ARROWS
IDEAL!
People heading in the same direction
Results
CURRENT
Lack of
Results
I - 32
Balanced Scorecard Hall of Fame for Executing Strategy

By Industry 2000-2011
I - 33

operational and
measurable terms
Align the
organization to
strategy and
motivate
employees to help
execute

DEVELOPING
Step 2
Align
Organizational
units to achieve
corporate
synergies
Step 4
DEVELOP
Step 1
STRATEGY
STRATEGY
MAPS
Step 10
DEVELOPING
Step 3
Develop a customer
focused strategy
SUPPORT AND LEAD

BALANCED
Strategy Map
Balanced Scorecard
StratEx
SCORECARD
ALIGN
SCORECARD
TO
DEPARTMENTS
Align
employees to
the strategy
Step 5
Step 9
results
Strategy Map
Balanced Scorecard
StratEx
CASCADE
SCORECARD
TO
INDIVIDUALS
& UPDATE
Step 8
STRATEGY
CREATE NEW STRATEGY

MANAGEMENT OFFICE
performance
measures
EVALUATE
results
Review strategy
implementation
REVIEW
& MONITOR
Step 7
EXCECUTION
LINK
STRATEGY
TO
OPERATIONS
Step 6
the environment and
the affects of the
strategic choices

Framework
I - 34
Balanced Scorecard Institute EMEA Certification Master Class

Training Module Map
Day 1
Introduction
Step 1 Develop Strategy
Day 2
Step 2 Develop Strategy Maps
Step 3 Develop Balanced Scorecard
Day 3
Step 4 Align Scorecards to Depts
Step 5 Cascade Scorecards to Individuals
Day 4
Step 6 Link Strategy to operations
Step 7 Review and Monitor Execution
Step 8 Evaluate and Update Strategy
Day 5
Step 9 Create Office of Strategy Management OSM
Step 10 Support and Lead Transformational Change
I - 35

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Balanced Scorecard Institute - EMEA

International Balanced Scorecard

and communicate a program of action to execute strategy.

Theme: Operating Efficiency

Attract & Retain

Plane Lease Cost"

Attract and retain

FAA On-Time Arrival

Ground crew aligned

Balanced Scorecard Institute -EMEA

Balanced Scorecard Institute -EMEA

A portfolio of strategic initiatives should be developed for each

Balanced Scorecard Institute -EMEA

Formal Strategy Execution Process

Clarify our strategy into

Set our strategic priorities

Align the organization to our

Respond to shifts in our

Check our progress and

Balanced Scorecard Institute -EMEA

Balanced Scorecard Institute EMEA

Clarify strategy into

SUPPORT AND LEAD

CREATE NEW STRATEGY

Developing the Strategy

Balanced Scorecard Institute -EMEA

Balanced Scorecard Institute -EMEA

Balanced Scorecard Institute -EMEA

Balanced Scorecard Institute -EMEA

Balanced Scorecard Institute EMEA Overview

BSCi EMEA is the regional leader in

Balanced Scorecard Institute -EMEA

Executing Strategy: The #1 Issue

Balanced Scorecard Institute -EMEA

Four Barriers to Strategy Execution

The Management Barrier

Only 25% of managers have

85% of executive teams

The Resource Barrier

Today s management systems were designed to meet the needs of stable

Balanced Scorecard Institute -EMEA

Balanced Scorecard Institute EMEA Services

Leadership and Change Management

Assist leaders (directors, executives, managers) to enhance their capabilities to execute

Operational and Information Excellence

Risk and Governance

Balanced Scorecard Institute -EMEA

Another Framing of Strategy Execution

Adapted from The MacIntosh Way, Guy Kawasaki

Balanced Scorecard Institute -EMEA

Balanced Scorecard Institute EMEA Framework Results

Sample: 164 Publicly Traded Firms

Balanced Scorecard Institute -EMEA

Balanced Scorecard Institute EMEA s

Balanced Scorecard Institute EMEA Framework Results

BSC Hall of Fame Organizations have achieved even greater improvements

3 Year Increase in Shareholder Value

BSC Users (1)

Balanced Scorecard Institute -EMEA

BSC Hall of Fame

Linked Left Brain, Right Brain Approach to Drive a

Elements of the integrated planning

Converting integrated plans into