The Balanced Scorecard measures the balance of four perspectives. . . a continuous, iterative organizational process.

Financial
To succeed financially, how should we appear to our stakeholders?

Innovation, Learning & Growth

To achieve our vision, how will we sustain our ability to change and improve?

Vision and Strategy

Customer
To achieve our vision, how should we appear to our customers?

Internal Business Process

To satisfy our customers, what business processes must we excel at?

Balancing Performance
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Performance Management Performance Measurement Performance Monitoring

Financial orientation Monthly reporting Historical information Based in standards Static viewing Financial and non-financial Measurement and feedback Accountability Departmental deployment Aligned with strategy Human factors incorporated Strategic feedback possible Forward-looking (Leading indicators) Enterprise deployment

Short-Term to Long-Term View

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 A planning aid to assist companys in formulating long-term competitive business strategies and translating strategy intoshort-term tactics and actions thereby aligning the organization strategically.

Long-term Vision & Strategy

Scorecard

Short-term Tactics & Action

Philosophy: Linking Strategy to Action

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Value
Financial Perspective
Operating Margin

Lagging
Efficiency Ratio

Service Utilization

Customer Perspective
Number Lives Touched

Top Three Healthcare System

Patient Recommendations

Internal Perspective

Efficient Service Delivery

Effective Outcomes Management

Leading Innovation, Learning & Growth Perspective

Employee Satisfaction

Leverage IT Across System

Strategic Linkage Model: Healthcare Example

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Measure (mezhur) - 1. A unit or standard of

measurement; 2. The extent, dimensions, quantity, etc. of something, ascertained especially by comparison with a standard.

What Happened?
Establish framework which reflects your strategic initiatives Define performance targets Normalize scores to scale Assign relative importance Define measurement periods

The Role of Technology

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Analyze (anl iz) - 1. To examine critically, so as

to bring out the essential elements or give the essence of; to examine carefully and in detail so as to identify causes, key factors, possible results

Why Did It Happen? Database Connectivity

native connections to Oracle, Informix, Progress, Sybase, Ingres, MS-SQL Server, DB2 Universal Database, Hyperion Essbase ODBC connections to virtually everything else

Powerful, Scalable, Flexible

robust product architecture information analysis, query & reporting

The Role of Technology

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Plan (plan) - 1. A scheme or method of acting,

doing, proceeding, making, etc., developed in advance; 2. A format program for specified benefits, needs, etc.

What If We Changed Something?

Detect Quantifiable Cause-and-Effect Relationships Perform What-If Analysis Forecast Goal Attainment

The Role of Technology

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Manage (man ij) - 1. To bring about or

succeed in accomplishing; 2. To direct, govern, or control in action or use.

Effectively Communicate Initiatives

Establish collaborative communication environment Communicate vision and strategy Gather feedback Closed loop action plans

The Role of Technology

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 The balanced scorecard is deceptively simple

Commitment of leadership Employee involvement in their performance measures Limit the number of measures to the vital few Accountability for the data Individual scorecards Strategic learning - using the scorecard for continuous improvement Tie into budgeting process Linkages to compensation plans & rewards systems

design and implementation can be difficult, if these key factors are overlooked.

Sustainability Factors
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 Operationalizes strategy Focuses entire organization on what needs to be done to achieve breakthrough performance Integrates corporate programs (e.G., Quality, BPR, process redesign and customer service) Corporate-level measures can be broken down to lower levels in the organization so that employees can see what they can do to improve organizational effectiveness Provides a comprehensive view of an organization

Benefits of a Scorecard
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Technology reduces the pitfalls of implementing a manual scorecard process...

Continuously communicates strategy and performance results of the organization Provides organizational tool to manage performance vs. measuring Creates collaborative communication environment and automated feedback loops Improves organizational speed and decision-making capabilities Creates a management process that can be continuously improved

Technology Benefits
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