1. The Balanced ScorecardCreating Strategy Map to Drive Corporate PerformancePrepared by : Gajendra KhareFounder Director Siddhartha Consultancy Serviceswww.scsuniversal.com

2. balanced Scorecard -DefinedWas first published in 1992 by Kaplan and Norton,The Balanced Scorecard is a strategic planning and managementsystem used to align business activities to the vision and strategyof the organization by monitoring performance against strategicgoals.o Translate strategy into actiono Planning for long term organizational successBalance between- Financial measure and performance- Long range competitive abilities- Offers balanced view of the organization upon which they canfurther add-onPrepared by Gajendra Khare 3. Balanced score card perspectivesA. Financial How do we succeed financially?B. Customer How do we appear to our customers?C. Internal ProcessAt what processes must we excel?D. Learning and GrowthHow do we sustain our ability to change and grow? 4. Why BSC Focus on key things neededto achieve breakthroughperformance Integration of variouscorporate program likeQuality, Business process re-engineering and Customerservice initiatives Communication andunderstanding of businessgoals and strategies at alllevels Provide comprehensivepicture of business operation 5. We Use the Scorecard to ArticulateStrategic Hypotheses in Cause-effectTerms FinancialResults To Drive FinancialSuccess...CustomerBenefitsNeeded to Deliver Unique Sets of Benefits to Customers...Internal Capabilities To Build the Strategic Capabilities..Knowledge, Skills, Systems, and Tools Equip our people 6. Managing performance with BSC Balances Financial and non Financial measured Balances short term and long term measures Balances performance Driver with outcome measures Leads to Strategic focus and organizational alignment 7. Balanced Scorecard Measurements 8. Balanced Scorecard Strategy Map 9. Process Strategy and BSCStrategic OutcomeMission why weSatisfied shareholdersexistsStrategyMap-Translatethe Delighted Customersstrategy Strategy Vision whatBalanced Our game we want to be Plan Score Excellent ProcessCards Measureand FocusMotivated workforce Values What is important to us 10. Departmental Level Score Card example 11. Key Implementation Success Factors Obtaining executive sponsorship and commitment Involving a broad base of leaders, managers and employees in scorecard development Choose the right Scorecard Champion Beginning interactive (two- way) communication first Viewing the scorecard as a long-term journey rather than a short-term project Getting outside help if needed 12. The Successful Scorecard Is a dynamic process continues to set higher targetsand achieves them Define jobs strategically from the perspective of whereit fits in with the strategicbusiness goals Supports joint decision making about what youdo/dont do based on strategicgoals 13. Scorecard PotentialPitfalls & Criticisms Lack of a well Defined Strategy The balanced scorecard relies on a well defined strategy and understanding of linkages between strategic objections and metrics. Without this foundation the implementation could fail. Too much focus on the laggingmeasures Focusing on only the lagging measures may cause a lack of priority or opportunity for the leading measures. Use of Generic Metrics Dont just copy metrics from another firm. Identify the measures that apply to your strategy and competitive position . Self-serving managers Managers whose goal is to achieve a desired result in order to obtain a bonus or other self reward. 14. Thank YOU