eu sf exec balanced scorecard

7/28/2019 EU SF Exec Balanced Scorecard

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ExecutiveBrief The Business Benefit of TheBalanced Scorecard

MethodologyThe Balanced Scorecard is one of the most widely adopted strategic planningtools used by small and mid-sized businesses today. Successful executivesare now discovering automated technology solutions as a means of converting their Balanced Scorecard methodology into actual businessresults.

This new generation of applications enables them to cascade strategy, linkindividual performance to strategy, and attain proactive visibility thusachieving the competitive advantage of an organisation that consistentlydelivers on strategic objectives.


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The business benefits of the balanced scorecard Executive Brief

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The Harvard Business Review highlighted the BalancedScorecard as one of the 75 most influential ideas of thecentury. It has been widely adopted by top companiesas a valuable strategic planning framework. Bybalancing the lagging indicators of financial measureswith leading indicators of operational drivers, theBalanced Scorecard provides a comprehensiveapproach to strategic planning.

Putting your strategy to work throughout your organisation

While developing a winning strategy is certainly not easy, making it happen is even morechallenging. No matter how good your strategy, if the employees do not understand and act uponit, it is threatening your future success. According to a Fortune Magazine study, 70% of management failures were due to poor execution of good strategies. When evaluating companiesfor investment, an Ernst & Young study found that financial analysts consider execution of corporate strategy to be even more important than quality of corporate strategy.

The key to achieving your objectives lies in not shelving yourstrategy maps after a one-time Balanced Scorecard exercise,but engraining the strategy, as a living plan, in the core of yourcompanys operations. By taking several critical steps cascading the Balanced Scorecard to every individual in thecompany, linking employee performance measures and rewardsto implementing and following the directions set through yourstrategy, making operational decisions through proactivevisibility your company can reach unprecedented success.

70% of CEO failures weredue to poor execution of

good strategies. Fortune Magazine

By taking several critical steps, your company canreach unprecedented success based on your Balanced Scorecard strategy.

Results

Strategy

Execution

Cascade Strategy Throughout Company

Link Measures and Rewards to Strategy

Use Proactive Visibility to Steer to Success


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Cascading your strategy throughout your company

Cascading your corporate goals throughout your organisation lets you align your employees to theoverall strategy. This ensures that everyone is focused on the key business objectives. Translatinghigh-level strategic goals into clear objectives for every business unit and every employee creates aclear line-of-sight from top down and bottom up so that each individual understands how theirday-to-day actions are contributing to overall company success.

This also allows employees to develop their own goals linked to the organisations objectives. Beingpart of this process improves understanding of operational and strategic direction and will makeeach individual feel committed to achieving the results.

Linking measures and rewards to strategy

Directly linking every employees performance measures and rewards to the corporate strategy isconsidered by many business leaders to be an invaluable tool for achieving better financial results.And for good reason: tying compensation to strategically aligned performance metrics is bound toincrease productivity through motivation and commitment.

But simply motivating your workforce is not enough. Energy spent on misaligned projects is not onlywasted, it devours valuable resources that could be contributing to real business goals. Linkingemployee metrics and rewards to strategy ensures that their efforts are focused on what is trulycritical to the success of the business.

Steering to future success through proactive visibility

Having visibility throughout the organisation to proactively assess progress and reallocate resourcesis crucial to driving results. With strategically aligned objectives where each employee has clearlydefined and interpretable metrics for evaluation of their own performance, managers can track theindividual progress of an employee and support or take corrective actions such us reallocation or

training and development on a more proactive basis. And management will have the visibility theyneed to ensure that strategic initiatives are receiving sufficient coverage.

By setting future directions based only on historical data, this kind of forward-looking visibilityoffers opportunities for executives to make immediate course adjustments to keep performance ontrack.

Visibility enables insight . Insight enables proactivity . Proactivity enables success .

50% of the average employees timeis spent on non-productive work. Norton & Kaplan, Balanced Scorecard


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Conclusion

While defining a business strategy is extremely important, making it happen is even more critical toa companys success. By providing each individual with the line-of-sight, accountability, andrewards to contribute to the overall strategy, you are motivating your employees to be not onlymore productive, but more strategically productive.

The management of a company is provided with data and the tools to drive results throughproactive visibility. Armed with leading indicators of performance drivers in addition to laggingindicators of financial data problems can be identified early and changes implemented to achieveintended strategic objectives.

About SuccessFactors

With more than 4.5 million users in 185 countries, SuccessFactors is the leading provider of Performance and Talent Management solutions that enable organisations to drive business executionand deliver superior business results.

For more information, please visit www.successfactors.com

eu sf exec balanced scorecard

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