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How Not to Implement a Balanced Score Card
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How Not to Implement a Balanced Score Card

by Ashok Grover

There are many turnaround and success stories floating around as a result of successful implementation of Balanced Score Card. However, these critical issues need to be taken care of to write your own success story.

 

Balanced Score Card (BSC), initiated less than two decades ago, was hailed as one of the 75 most influential ideas of the twentieth century. Today, 70% of Fortune 1000 have implemented the same... and there are many turnaround and success stories floating around as a result of its successful implementation.

Yet, many untold stories speak volumes about failure as well. We don't talk about them. Unfortunately, closing our eyes to this grim reality does not help. Let us have a close look at the road to disaster:
 

  1. No BSC effort can ever succeed without senior management support. If the management declares that the scorecard is to be implemented in the organization and just expect that their orders will be followed by the people, it is nothing more than a wish inscribed on sand. The next wave of water or a stray wind will do the job as if nothing ever happened.
  2. Measurement is the key. Many senior people insist that at strategic positions, their activities and contribution can not be a measurable thing. Entertaining such arguments makes sure that the initiative is unceremoniously buried. The rule that what can not be measured can not be improved, is applicable universally, more so in this case.
  3. Balanced score card is not a collection of some KRAs picked up from here and there. It is a strategy management tool and must have close linkages. As such, apparently an important KRA with no linkage with any of the strategic goals is in fact not important enough.
  4. Any good scorecard must be balanced, including the balancing of lead indicators and lag indicators. Traditional way of looking only at lag indicators will result into a good post-mortem with no way to "implement and test" whatever you learn.
  5. Short cuts and rushing through at the planning stage leads to disaster in spite of extraordinary implementation efforts. Developing a good strategy is as important as its successful implementation.
  6. Every organization is unique. The same pill does not work for all the patients. Gulping down a few pills just because it cured someone else, is a dangerous proposition. A lifesaver for someone else may turn out to be killer in your case. Do not experiment on yourself. Let the specialists customize the prescription for you.
  7. Balanced Score Card implementation is a collaborative exercise. If consensus is compromised at any stage to push the implementation, it will defeat its very purpose.
  8. No score card is perfect and no score card is final. You go on improving a score card to make it perfect, and you can continue going on and on forever. Alternatively, you decide that once finalized, nothing can be changed in it, and you have a dead document you will be happy without!
  9. Having finalized the balanced score cards, overlooking resource allocation in line with organization strategy leads to frustration and demotivation ensuring failure of this intervention.
  10. Third party intervention is always helpful. But you can not just delegate the job out of organization. As per an old saying, the consultants can take you to the pond; but can not make you drink water. Ownership and commitment of the organization has to be within.

These are some of the key points, which would be helpful to an organization implementing or thinking to implement Balanced Score Card. Take care of these issues and make sure that you also have a success story to share!

Ashok Grover is an expert in people assessment and focused executive / leadership coaching. He is Director at Skillscape, a company with a vision of Value Creation by enhancing people and organizational competencies.

His last assignment was with the JBM Group as Corporate Chief Human Resource Officer. He has over four decades of experience in operations, materials, information technology and people development with Parle Group, Mohan Meakins Group, Hawkins Cookers Limited and JBM Group.

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