«

»

Oct 29

Print this Post

Using the Balanced Scorecard In Project Management

Tying customer experience into payProject managers frequently measure and rate team member performance. The balanced scorecard measures the results within the control of the team, while showing the value the team brings to the overall company.
While this oversimplifies a complex problem, companies across the world utilize balanced scorecards to rate themselves, divisions, departments, teams and individuals.

What Is a Balanced Scorecard?

A balanced scorecard translates the mission and vision of a company into a set of measurable outcomes. In 1996, Kaplan and Norton published the book, The Balanced Scorecard: Translating Strategy into Action The classic balanced scorecard uses 4 general categories to balance short and long-term goals. They are:

  • Financial measures,
  • Customer knowledge,
  • Internal business processes, and
  • Learning and growth

Bain and Company ranked the balanced scorecard among the top 10 tools used by managers for 2010. The list includes benchmarking, outsourcing, and Mission and Vision statements

I heard a Balanced Scorecard Is Difficult to Use. Can you simplify it?

Like project management, the scorecard concept is very versatile. Start by focusing on why you want to develop a balanced scorecard. Focus on tangible items like:

  • What did we do?
  • How did we do it?
  • Are we improving as we do it again?
  • What did my investment of time and resources give me in return?

Project and program managers will see similarities between the measurements in classical balanced scorecards with the reporting tools used for most projects. Because the metrics are designed from the viewpoint of the customer and stakeholder, project leaders may see ways to modify the balanced scorecard to fit their team.

Modified Balanced Scorecard
Modified balanced scorecard focusing on a project team or department of teams.

How Do I Begin?

I like to think in process steps when it comes to complex changes.

Step 1:  Find the Mission and Vision statement, as well as the strategic intent for the group. Some companies have a well designed Vision statement. For practical purposes, the mission and vision may not be tangible enough to translate directly to actions.  Many times, the best source of what the entire group wants to achieve may be found within the marketing plan.  If the Mission and Vision are out of date, then focus on what the division goals would be based on the product line, the desired customers serviced, and the method the company wants to use to go to market in its own unique way.

Step 2: Hold a brainstorming session to determine the performance categories that best link the business’s vision  to its results. During the meeting, the team should be able to fully describe what the mission, vision and strategy should look like when put into action (along the lines of product innovation, employee achievement, financial performance, operational efficiency).

Step 3: Establish the objectives and supporting measurements that align with the business’s mission and strategy. Double check to ensure that the metrics are available (or will be available) and are able to be collected and analyzed  in a timely manner. If any surveys are involved, remember that survey fatigue sets in after very few requests for feedback. Also, double-check that any resources (read people or vendors) needed to run the scorecard are available and understand the task.

Step 4: Develop a communication plan to send out the scorecard, including what is in the scorecard, the frequency of updates, and what the scorecard means to the person, team, department and company.

Step 5: Collect and analyze the metrics. Publish the scorecards and compare them to the desired results.

Step 6: Identify actions required to close any gaps during one-on-one meetings, as well as staff and departmental meetings.
By conducting timely meetings on scorecard results, every person will feel connected and hold a level of ownership in the results of the scorecard. If feedback is given quickly, individuals, teams and department have sufficient time to improve performance.

It’s all About Projects and People

People make up teamsCompanies are not simply a bundle of strategies tied to a mission. Companies achieve what they do through the day-to-day actions of every employee. Stakeholders set the stage by approving projects and budgets. Project teams provide their part by delivering the products from the projects.
When a balanced scorecard is executed well, customer and stakeholder insights are provided to employees in a way that helps improve all aspects of the experience. Customers feel better in receiving a product that meets their needs in a way that works for them. Stakeholders feel that their investment in the team was the best use of the money.  And, employees see tangible results from delivering the right goal the right way.

Permanent link to this article: http://nortoncreative.com/using-balanced-scorecard-project-management/

HTML Snippets Powered By : XYZScripts.com