Intravate

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Intravate Balanced Scorecards Briefings Part
3 From Strategy Mapping to Targeting
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Balanced Scorecards
Financial How do we look to our Shareholders
Customers How are we doing with our customers?
Process Quality To deliver customer
shareholder value, what must we excel at?
Organisational What competencies, culture
style do we need to sustain and improve
performance?
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Building a full Strategic ScorecardSimplified
Example

• Financial
• To consistently achieve higher Return on Capital
  than our competitors
• To achieve year on year profit growth

• Customers
• Sustained Market Leadership
• To consistently be rated as providing the Best
  Customer Service

• Process Quality
• Consistently achieving lowest error rates
• Highest Productivity Levels in the Sector

• Organisational
• Attracting retaining the best quality staff.
• A flexible organisation, responding quickly to
  opportunities challenges

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Building a successful ScorecardPutting
measures against the objectivesAn Example

• Financial
• Operating Profit
• Return on Capital
• Cost Structure
• Shareholder Returns

• Customer
• Key Market Shares
• Sales Data
• Customer Satisfaction
• Image Data

• Process Quality
• Key Process Standards
• Productivity
• Quality Mgt. Rating

• People Development
• Culture
• Staff Pride Morale
• Competencies
• Innovativeness

Hard measures not woolly wish lists Project
milestones should be reported elsewhere
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Putting Targets against the measures Real
targets not wish-lists

• Financial
• Profit 70m
• Cost of Sales 52

• Customer
• Customer Satisfaction 73
• Customer Retention 97

• Process Quality
• Key Standards 99
• ( achieved)
• Productivity 110k
• (k per head)

• People Development
• Staff Morale Index 90
• Staff Retention 98

Once off Project milestones should be part of
the performance management reporting process, but
not part of the scorecard itself
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Scorecard Weightings, if used, should reflect
short term strategic priorities

• Financial
• (30)
• Profit 20
• Cost of Sales 10

• Customer
• (25)
• Customer Satisfaction Index 15
• Customer Retention 10

• Process Quality
• (20)
• Key Standards 10
• Productivity 10

• People Development (25)
• Staff Morale Index 20
• Staff Retention 5

Weightings should be established as part of the
Strategic Planning process
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Building Your ScorecardKey Development Guidelines

• Get a clear view on scale scope at the outset.
  You are putting in a management system not merely
  a scoring mechanism
• Establish linkages performance drivers not
  independent measures.
• Establish a Strategic Vision Scorecards as well
  as a 1 year Operating Scorecard
• Do not strangle yourself with too many measures.
• Do not Shoot yourself in the foot with too
  few!!
• Set meaningful targets. Put milestones in their
  correct place!
• If possible, establish priority weightings and
  plan ranges.
• Communicate to key players. Explain the purpose
  how it works as well as content. Get their
  buy-in.
• Dont over-engineer the design at the start.
  Better a simple route that you can get
  operational quickly.
• Continuously review and improve Scorecards
  measures.

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IntravateEurope, Hong Kong Australia

• United Kingdom
• Intravate Business Centre
• Kirdford
• West Sussex
• United Kingdom RH14 0NJ
• 44 (0)1403 820994
• 44 (0)1403 820911

• Hong Kong
• Suite 21D
• Block One
• 10 Robinson Road
• Mid-levels
• Hong Kong
• 852 9529 1184

Australia Ground Floor 726 High Street East
Kew Victoria 3102 Postal PO Box 328 Balwyn North
VIC 3104 61 414 988 885
www.intravate.com