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BSC
Human Resources » Performance Management


Chrm Message From: rajeshmohanjha Total Posts: 4 Join Date: 15/02/2009
Rank: Beginner Post Date: 19/08/2010 08:02:52 Points: 20 Location: India
Can BSC be applied in a start up company at a project stage?
Chrm Message From: debora Total Posts: 79 Join Date: 15/02/2009  
Rank: Manager Post Date: 15/10/2019 11:22:32 Points: 350 Location: India

 

The balanced scorecard (BSC) is a strategic planning and management  system that organizations use to:

§  Communicate what they are trying to accomplish

§  Align the day-to-day work that everyone is doing with strategy

§  Prioritize projects, products, and services

§  Measure and monitor progress towards strategic targets


The system connects the dots between big picture strategy elements such as mission (our purpose), vision (what we aspire for), core values (what we believe in), strategic focus areas (themes, results and/or goals) and the more operational elements such as objectives (continuous improvement activities), measures (or KPI's , which track strategic performance), targets (our desired level of performance), and initiatives (projects that help you reach your targets).

BSCs are used extensively in business and industry, government, and nonprofit organizations worldwide. Gartner Group suggests that over 50% of large US firms have adopted the BSC. More than half of major companies in the US, Europe, and Asia are using the BSC, with use growing in those areas as well as in the Middle East and Africa. A recent global study by Bain & Co listed balanced scorecard fifth on its top ten most widely used management tools around the world, a list that includes closely-related strategic planning at number one. BSC has also been selected by the editors of Harvard Business Review as one of the most influential business ideas of the past 75 years.

The BSC suggests that we view the organization from four perspectives, and to develop objectives, measures (KPIs), targets, and initiatives (actions) relative to each of these points of view: 

§  Financial: often renamed Stewardship or other more appropriate name in the public sector, this perspective views organizational financial performance and the use of financial resources

§  Customer/Stakeholder: this perspective views organizational performance from the point of view the customer or other key stakeholders that the organization is designed to serve

§  Internal Process: views organizational performance through the lenses of the quality and efficiency related to our product or services or other key business processes

§  Organizational Capacity (originally called Learning and Growth): views organizational performance through the lenses of human capital, infrastructure, technology, culture and other capacities that are key to breakthrough performance

 

Chrm Message From: debora Total Posts: 79 Join Date: 15/02/2009  
Rank: Manager Post Date: 22/10/2019 11:18:07 Points: 350 Location: India

 

Reason 1. Getting a Clear Understanding of the Strategy

Balanced Scorecard puts on paper the strategy of the startup. Most likely, you won’t discover any secret shortcut to become a unicorn, but I’m sure there will be some “aha” moments. The Balanced Scorecard framework is about these four perspectives:

·         The expected financial results

·         Customer value proposition

·         Business processes that a company needs to have

·         Key learning and growth direction to focus on

Within each of the perspectives, we answer certain questions, and the answers are connected by cause-and-effect logic. In the case of a startup, these questions can be:

·         FinanceHow do we monetize the value created for customers? Our goal: achieve economic sustainability.

·         CustomersWhat value do we create for the customers? What do our customers need? How do customers perceive the value that we create?

·         InternalHow do we create value for customers? How do we attract, engage, and get feedback from customers? What business processes do we need to create value? How do we retain customers?

·         Learning and growthWhat knowledge/skill gaps do we need to fill in? What skills does our team need? Where does customer development need to be focused?

 

Reason 2. Pitching Idea to the Investors

Balanced Scorecard framework comes from the corporate world, and by having a strategy map, you send to your potential investors a simple message:

·         “We did our homework in terms of strategy… here is how we plan on executing it…”

That’s similar to what non- profit organizations do when they are looking for financial donors. That’s what top managers do when they pitch their ideas internally to the board members.