bsc orientation

7/31/2019 BSC Orientation

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VOIE N. SOLIBANVersion 2007.0

Email Ad: [email protected]


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BSC as Approach to

M&EWhat is the Balanced Scorecard (BSC)? Developed by Robert Kaplan and David Norton of

Harvard in 1990 Provides a new way of measuring organizational

performance: Financial performance measures

cannot be the only metric to assess an

organizations performance.

Provides a foundation for measuring and managing

the value created by other facets of an

organization: intangible assets such as employees,

processes and systems, customer relationships.


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BALANCED SCORECARD

The BSC is a strategic managementsystem (and not only a measurement

system) that enables the organizationsto clarify mission / vision and strategyand translate them into action. Whenfully deployed, the BSC transforms

strategic planning from an academicexercise into the nerve center of anenterprise.


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BSC Continuum: Alignment tool

Mission

Why we exist?

Vision

What we want to be

StrategyHow do we achieve our mission/vision?

Strategy Map

Translation of the strategy

Scorecard

Measure, targets, initiatives

StrategicOutcomesPoverty alleviation, Satisfied stakeholders, Efficient processes, Skilled workers


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BSC M&E Process

Translate strategy into

objectives

Report results

Develop measures

and targets

Analyze data Collect data


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Strategy map and

Scorecard: Alignment tools

Financial perspective

Process Improvements

Organizational learning & growth

Objectives Measures Targets Initiative

Customer satisfaction


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It is a visual

presentation of an

organizations strategytowards the attainment

of its mission and

vision;

It shows the alignmentof an organizations

objectives with its

mission , vision and

strategy (ies).


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Building Blocks of a Strategy MapMission/ Vision/Mission/ Vision/

StrategyStrategy

Objec

tive

Customer

Financial

InternalProcesses

Learning and

Growth

Objective

Objec

tiveObjec

tive

Objec

tive

Objec

tiveObjec

tive

Objec

tive

Objec

tive

Objec

tive


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Benefits of Using the BSC

Communicates

and

educates multiple

stakeholders about

strategy

PromotesTransparency

and

accountability

Provides focus

Each part of

the organization

aligns to common

objectives

Sound Financial Management

Internal Process

LearningandGrowth

Clients


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Strategy

MapExample

Province of Bohol

A-04-PGBH-002:ProjectIdentification andDevelopmentusing the LocalPoverty ReductionAction Plans(LPRAP)


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Strategy mapMissionVisionStrategyPerspectivesObjectivesCause effect

relationships

BSC Basics

Terminology and

Concepts

Building blocksBuilding blocks


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BSC Basics

Strategy

Mission and

Vision:

Increasein profit

Operations management

Customer management

Innovation

Example: Private sectorExample: Private sector


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StrategiesStrategies

DefinitionDefinition

Operationsmanagement

Customermanagement

Innovationprocesses

Examples of organizations with focused strategyExamples of organizations with focused strategy

Producing anddelivering productsand services tocustomers in the cheapest

and most efficient way

Establishing &leveragingrelationships withcustomers by deepeningrelationships with

customers

Developing newproducts, servicesprocesses &relationships

JollibeeChowking

Yellow CabMcDonalds

SMARTGLOBE

HSBCBPI

SONYMicrosoft

HPMercedes Benz

BSC BasicsBSC Basics

StrategyStrategy


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BSC Basics

Strategy

Mission/ Vision:

Improve the plight

of the province

Eco-tourism

Agriculture

Coastal resource

management

Example: LGU contextExample: LGU context


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BSC Basics

Scorecard

A scorecard contains a set of grouped

objectives and metrics derived from anorganizations strategy

A scorecard may represent an

organizational group. A scorecard is

commonly cascaded within the

organizations hierarchy


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BSC Basics

Scorecard

Ideally, scorecards within an

organization are strategically alignedand linked to one another.


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BSC Basics

PerspectiveA perspective is a grouping of objectives and metricswithin a scorecard.

Commonly used perspectives are: Financial,Customer, Institutional Process Improvement,Learning & Growth

Perspectives may be customized to the organization

Perspectives possess a cause-and-effect relationship,driving toward the final perspective


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BSC Basics

Objective

Describes what you must do well in order to

effectively implement your strategya verb noun statement for a desiredbusiness outcome, e.g., Enhance thecapacity of HR personnel and line managers

in human resource management anddevelopment

often represent elements of a strategic plan

can be linked and cascaded


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BSC Basics

Initiativesare also called projects, action plansor outputs.

typically have a start and end date,associated resources, andmilestones.

can be linked to scorecards,objectives, and or measures


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Process

Step 1:

Perspectives

Step 7:

Evidence

Step 6:

Baseline

Rating

Step 5:

Target

Step 4

Baseline

Data

Step 3:

Measures

Step 2:

Objectives


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Balanced Scorecard

Framework (Private Sector)

Mission/

Vision and

Strategy

CustomerTo achieve our vision,

how should we appear

to our customers?

Internal BusinessProcesses

To satisfy our shareholders

and customers, what

business processes must

we excel at?

Learning and GrowthTo achieve our vision, how will

we sustain our

ability to change and improve?

FinancialTo succeed financially, how

should we look to our

shareholders?


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Features

Objectives

Features Private Sector Public Sector

General Strategic

Goals

Stakeholders

Desired Outcome

Competitiveness:

uniqueness

Mission success:

fulfillment of mandate

Stockholders; buyers;

managers

Profit

Taxpayers; recipients;

legislators;

constituents

Constituents served;

Customer

Satisfaction/

Development


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Scorecard Components

Objectives Measures Targets Initiatives

- What the strategy is trying to achieve

- How performance against objective isMonitored

- Required level of performance.

-Action program to achieve target.

Sound Financial Management

Internal Process

LearningandGrowth

Clients


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What is a measure

Elaborations of the objectives

Measures are what you look forwhen evaluating whether the

objectives are attained.

Expressed in terms of quantity,quality, timeliness and/or cost


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Determining what really

counts!In Davao City, a priest and a taxicab driver died

and went to heaven. Saint Peter then

showed the priest his eternal dwelling place-a shack. Saint Peter then showed the driver

his eternal dwelling place a mansion. The

priest was angry and asked Saint Peter, Why

the difference? Saint Peter said, when youpreach, people sleep. When riders get into

his cab, they pray!


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Impact measures

Measures at this level track the effects of

training on the attainment of the objectives of

the development thrusts (e.g. agriculture,eco-tourism) that lead to better customer

satisfaction. Examples

Improvement in productivity level of farms Increase in adoption rate of new farming technology

Improvement in quality


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Impact measures

Advantage

Track the benefits

received at thecustomer level

Establishes more

accountability

among the

stakeholders

Disadvantage

Difficult to isolate the

effects of trainingNot within the

control of

trainees/training


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Monitoring and

EvaluationWhat is M&E?

Why is it important?

What are the current

approaches to M&E?


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Monitoring and

EvaluationWhat is M&E?Monitoring

continuing function of systematically collecting,analyzing and reporting information during theimplementation

to enable management and key stakeholders tojudge progress and quality of implementation,

identify and solve problems and improve quality.

Emphasis is on activity and output levels.

Source: Unsaid Source: Unsaid


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Monitoring and

EvaluationWhat is M&E?Evaluation

periodic systematic and objective assessment of therelevance, efficiency, effectiveness, impacts and

likely sustainability of an ongoing or completed

activity.

Emphasis is on outputs, outcomes and impact

Source: Unsaid Source: Unsaid


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Monitoring and

EvaluationWhy is it important?Learn from past experience

Improve service deliveryPlan and allocate resources

Demonstrate results as part of

accountability to stakeholders

Source: Monitoring & Evaluation: tools, methods, and Approaches, World Bank, 2004Source: Monitoring & Evaluation: tools, methods, and Approaches, World Bank, 2004


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Monitoring and

EvaluationWhat are the current tools, methods and

approaches to M&E?

Performance indicators Formal surveys

Rapid appraisal methods

Participatory methods

Public expenditure tracking surveys Cost-benefit and cost-effectiveness analysis

Impact evaluation

Source: Monitoring & Evaluation: tools, methods, and Approaches, World Bank, 2004Source: Monitoring & Evaluation: tools, methods, and Approaches, World Bank, 2004

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