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    In this article, author, management consultant and Balanced Scorecard expert Paul Niven points out that even the most well constructed Balanced Scorecard will not instantly transform an organization.

    For the Balanced Scorecard to deliver positive change, it must be embedded in an organization’s management systems and become the cornerstone for management analysis, support, and decision-making. This requires that organizations determine exactly why they are embarking on a Scorecard program in order to ensure the Scorecard functions as a management system.

    The author discusses possible reasons for launching a Balanced Scorecard program and cautions that every organization must necessarily determine the precise motivation for launching the Balanced Scorecard. This motivation must emerge out of every organization’s particular circumstances.

    A failure to develop a clear and guiding rationale for the Balanced Scorecard creates problems for organizations – fuelling confusion, cynicism and suspicion. On the other hand, a well understood, agreed upon, and widely communicated rationale for the Balanced Scorecard program can help organizations overcome difficulties that will be encountered during implementation and ensure the success of the Balanced Scorecard initiative as a performance management system. 

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    In this article, author, management consultant and Balanced Scorecard expert Paul Niven examines the relevance of ‘execution’ – a term that is very much in vogue on the business landscape – for those involved in strategy implementation and the Balanced Scorecard.

    The author presents three important arguments. Execution is a discipline integral to strategy, a core element of an organization’s culture, and the major job of the business leader. In fact, these are organizational imperatives, argues the author.

    The key to unlocking the true potential of the Balanced Scorecard framework to transform business lies in using the information stored within strategy maps and performance measures. This calls for significant discipline and is an area where many organizations fail.

    Nothing is more important for business leaders than executing strategy and the Balanced Scorecard is a powerful and proven tool that helps business leaders do just that. Leaders need to throw their full weight behind the execution of strategy and Balanced Scorecard programs.

    Finally, execution is a core element of an organization’s culture – a set of tangible and intangible elements that represent ‘the way things are done’ in that organization. The Balanced Scorecard helps organizations learn about their strategies and get execution right so that performance becomes pervasive in the organization.

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    In this article, author, management consultant and Balanced Scorecard expert Paul Niven argues that the discipline of Cost Management must evolve to face the realities of the new economy and meet the rapidly changing information needs of today’s decision makers. Cost Management, like finance, is finding out that the new mandate calls for providing the information companies need to produce the value their customers demand.

    A focus on the importance of performance measurement is an integral component of the evolution Cost Management is undergoing. In this context, the Balanced Scorecard has emerged as a proven and effective performance measurement tool as organizations seek to succeed at strategy implementation and translate intangible assets into real value for stakeholders.

    The author examines how the combination of Balanced Scorecard measures and Cost Management techniques can work together in satisfying the ever-growing needs of the information consumer.

    While Cost Management is a key aspect of the Financial strategic perspective of the Balanced Scorecard, it has a role to play through the entire Scorecard architecture. The author shows the relevance of Activity Based Costing in the other three strategic perspectives – Customer, Internal Process, and also Employee Learning and Growth – to identify and implement the right strategies for aspects like profitability of customer segments; quality, timeliness and cost of current processes; and investments in employee skills, tools, and alignment programs that promise to deliver a range of benefits.

    Thus, the Cost Management discipline can use the Balanced Scorecard to provide critical information and facilitate many of the strategic dialogs in organizations.

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    Management writer and educator James Creelman is, in the words of David Norton, co-creator of the Balanced Scorecard, ‘the foremost chronicler and historian of the Balanced Scorecard movement.’ Author/co-author of 16 important management reports and books, James Creelman answers a question about how to get the right balance of strategic objectives in a Strategy Map, so that it does not become unmanageably complex or far too simple with no meaning.

    Creelman responds that the greatest value of strategy mapping is that it provides the opportunity to identify the critical few strategic capabilities and relationships that will really make the difference in delivering the strategy. He observes that this is a great challenge in practice. So, organizations opt for generic objectives or ignore strategically critical objectives. The result is a poor Strategy Map.

    At the same time, trying to capture all the causality makes the Strategy Map too complex, confusing and inappropriate as a day-to-day strategy management tool.
    Drawing on examples such as Saatchi & Saatchi Worldwide, Creelman then presents the outlines of a solution that bring together 1) the beauty of simplicity so that the Strategy Map offers a laser focus, is easy to communicate and inspires, and 2) still captures the primary drivers of strategy. He also points out that organizations should focus on stressing the relationships between groups of strategic objectives or between strategic perspectives so that the real dynamics of value creation in the marketplace are captured adequately.

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    It is an acknowledged fact that the active support and involvement of the senior management team is the most important success factor in an enterprise performance management or Balanced Scorecard initiative. So influential is this success factor that the creators of the Balanced Scorecard initiative have made ‘mobilizing change through executive leadership’ one of the five principles for building a strategy-focused organization.

    This article goes further to say that the single most important scorecard success criterion is the active support and involvement of the Chief Executive Officer (CEO), because it is the CEO who is ultimately held accountable for the success or failure of strategies. The CEO has to lead from the top and reengineer the management process from within the organization. Further, the CEO and the senior team collectively own the strategy. When the CEO and senior team fail to own the initiative, the Balanced Scorecard becomes merely one more performance improvement tool among many.

    The article also asserts that design of the scorecard is also the responsibility of the CEO and the senior management team.
    Drawing on case studies such as Saatchi & Saatchi Worldwide, the article discusses at great length the role played by the CEO and senior team in different organizations to champion a scorecard initiative. In particular, they play an all-important role in defining the strategic objectives and strategic initiatives. Only when this role is fulfilled can organizations expect to realize the potential of the Balanced Scorecard as a tool for organizational transformation and breakthrough performance. Then, the Balanced Scorecard becomes a true strategy management framework.

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    Management writer and educator James Creelman is, in the words of David Norton, co-creator of the Balanced Scorecard, ‘the foremost chronicler and historian of the Balanced Scorecard movement.’ Author/co-author of 16 important management reports and books, James Creelman here answers a question seeking his view of the new Office of Strategy Management (OSM). In response, James Creelman traces the origin of the Office of Strategy Management concept, believes that it has actually taken a rather long time to emerge and how it is now creating a space for strategic management as a core organizational function, much in the same manner as HR or finance. He then goes on to describe the seven responsibilities of the Office of Strategy Management.
     
    Further, he believes that, in practice, the concept can make a difference to the success of performance management and Balanced Scorecard initiatives by focusing on the inculcation of Balanced Scorecard and strategy management skills. Creelman anticipates that the OSM concept will address several problems – such as the present Project Manager view of the Balanced Scorecard Manager – and finally ensure that strategy is managed as a single end-to-end process, from formulation to execution to feedback. Creelman also predicts that the OSM concept will be the most enduring legacy of Norton and Kaplan because, he feels, inculcating strategy management as a core function has greater implications for organizational management in the 21st century than even the Balanced Scorecard

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    Management writer and educator James Creelman is, in the words of David Norton, co-creator of the Balanced Scorecard, ‘the foremost chronicler and historian of the Balanced Scorecard movement.’ Author/co-author of 16 important management reports and books, James Creelman answers a question about the extent of popularity of the Balanced Scorecard in parts of the world other than North America and Europe. In his detailed response, James Creelman points to the growing popularity of the Balanced Scorecard concept in Latin America and Asia and cites examples from Brazil, Hong Kong, India, Korea, Mexico and Singapore that have attracted worldwide attention for their success. Finally, he even predicts that Asia might overtake other continents in its use of the Balanced Scorecard.

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    This interview features Sven Edvinsson, Senior Vice President, Head of Group Planning, Nordea. Headquartered in Stockholm, Sweden, Nordea is the leading financial services group in the Nordic and Baltic Sea region. In 2004, Nordea was inducted into the prestigious Balanced Scorecard Collaborative Hall of Fame.

    In the course of a wide-ranging interview, Sven Edvinsson discusses how long he has been managing the Balanced Scorecard for Nordea, how the Balanced Scorecard fits into the larger Planning and Performance Management Model (PPMM, comprising the Balanced Scorecard, rolling quarterly financial forecasts, and service level agreements), the amount of time he commits in his role, his main duties relating to that Council’s Balanced Scorecard, the key personal and professional skills required of a Scorecard manager, the training he received, the use of his functional background in managing the Balanced Scorecard program, the nature of senior management backing he received, the major challenges he faced when building and implementing the Balanced Scorecard, and how to overcome the challenges. Further, Sven Edvinsson also tells us what he enjoys most about working with the Balanced Scorecard, how it benefits him personally and tries to see how his role would evolve 2-3 years down the line. Finally, drawing from his experience, he identifies critical success factors in succeeding as a Balanced Scorecard manager.

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    This interview features Peter Ryan, who was Corporate Strategy and Performance Planner for the City of Brisbane until November 2005. Brisbane City Council is Australia’s largest local authority, and has an annual budget in excess of A$1.6 billion, employs over 7,000 people and is responsible to a population of almost one million residents. In October 2003, Brisbane City Council was inducted into the Balanced Scorecard Collaborative Hall of Fame, an honor reserved for organizations demonstrating significant results against the criteria of the strategy-focused organization.
     
    In the course of a wide-ranging interview, Peter Ryan discusses how long he has been managing the Balanced Scorecard for the Brisbane City Council, the Balanced Scorecard management process within Brisbane City Council, the amount of time he commits in his role, his main duties relating to that Council’s Balanced Scorecard, the key personal and professional skills required of a Scorecard manager, the training he received, the use of his functional background in managing the Balanced Scorecard program, the nature of senior management backing he received, the major challenges he faced when building and implementing the Balanced Scorecard, and how to overcome the challenges. Further, Peter Ryan also tells us what he enjoys most about working with the Balanced Scorecard, how it benefits him personally and tries to see how his role would evolve 2-3 years down the line. Finally, drawing from his experience, he identifies critical success factors in succeeding as a Balanced Scorecard manager.

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    This interview features Lawrence Ganti, Corporate Director, Office of Strategy Management, for the Geneva, Switzerland based Serono, which reported 2005 revenues of more than $2.5 billion, making it the largest biotechnology company in Europe and among the leaders in the world. It has eight manufacturing plants and 4,900 employees spread across 45 countries. Serono’s groundbreaking work includes its treatments for infertility, growth hormone deficiency and multiple sclerosis. Serono was inducted into the prestigious Balanced Scorecard Collaborative Hall of Fame in 2006.


    In this interview, drawing from his experience of facilitating the Balanced Scorecard program in Serono, Lawrence Ganti presents a practitioner’s viewpoint regarding various aspects of the Balanced Scorecard concept.

    In the course of a wide-ranging interview, Lawrence Ganti discusses how long he has been managing the Balanced Scorecard in Serono, the scope of his role as Director of the Office of Strategy Management, how the Balanced Scorecard is managed within Serono, the reasons why his job of Balanced Scorecard Manager is a full-time position, how he first got involved with the Balanced Scorecard, his involvement with the Balanced Scorecard initiative in Serono, the key personal and professional qualities necessary for a Balanced Scorecard manager, the training he received, the use of his functional background in managing the Balanced Scorecard program, the nature of senior management backing he received, the major challenges he faced when building and implementing the Balanced Scorecard, how to overcome the challenges and maintain the momentum of the scorecard initiative, and the system Serono has in place for managing the Balanced Scorecard. Further, Lawrence Ganti also tells us what he enjoys most about working with the Balanced Scorecard, how it benefits him personally and tries to see how his role would evolve 2-3 years down the line. Finally, drawing from his experience, he identifies critical success factors in succeeding as a Balanced Scorecard manager.

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