Balanced Scorecard Strategies And Hr Metrics Workshop Sept 13 Chicago, Il
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Transcript of Balanced Scorecard Strategies And Hr Metrics Workshop Sept 13 Chicago, Il
- 1. Balanced Scorecard Strategies and HR Metrics
Presented by
Mr. Frederick S. Rick Buchman
Practitioner and Expert on Balanced Scorecard and Dashboard Applications, and
Co-Author,Balanced Scorecard Strategy for Dummies, Wiley & Sons, Inc. Sept 2007
September 13, 2010
Chicago, IL
9/13/2010
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies Workshop Presenter: Rick Buchman
1
2. Discussion of the Workshop
9/13/2010
For this Workshop
Objectives of the course:
Understand the fundamentals of the Balanced Scorecard and Dashboard
approach within an HR framework, (specific to HR Metrics), and be
able to:
Develop a framework for your Strategy Map
Devise the elements for each Leg of your Balanced Scorecard
Design your Dashboard Concept
Conduct of the course:
Some introductory lecture, mostly interactive, individual
work
Majority split into research time, collaborative, evaluative and
presentation materials
Total time about 140 min.
2
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
3. Overview and Definitions
What is meant by the term Balanced Scorecard?
- Traditional Scorecards are mostly Financial Based
4. Revenue, Margin, Profit, Cash Flow, Budget Compliance, While
these are very important to a company, they do not tell the whole
story and decisions based on these metrics may not work(like
wagging a dog)
- Balanced Scorecards look at the multiple dimensions of an organization, Primarily focusing on:
5. CustomerSatisfaction and Focus 6. Financial Performance 7.
Business Process Performance 8. Employee Knowledge, Skills and
Competencies9/13/2010
3
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
9. The Four Legs of a Balanced Scorecard
9/13/2010
Business Process Performance
Employee Knowledge, Skill and Competencies
Per Delivery Plan
First Time Right
Exactly as Ordered
Excellent Condition
Cost Management
Good Handoffs
In-Process Checks & Great Quality
First Time Right
Customer Focus
Product Understanding
Process Understanding
Business Knowhow
Teamwork & Feedback
Continuous Improvement
On-TimeWorks Great!
Great Price!Durable
Customer Satisfaction
and Focus
LoyaltySelective
Confident Responsive
Financial Performance
Revenue Profitable
MarginCost Management
Competitive Advantage
Market ShareBusiness GrowthShareholder Value
4
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
10. 9/13/2010
5
Overview and Definitions
Write down 4 general items related to each Leg, related to HR
Metrics. Then, code each item as S, O, or T for Strategic,
Operational or Tactical.
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
11. 9/13/2010
6
Overview and Definitions
Small Group Discussion
- Small group discussion:
12. Get into groups of 5-6, sorted by Strategic, Operational or
Tactical. 13. Focusing on the specific HR Metrics you are focusing
on, discuss each Leg and the items you have written down.Share your
thoughts with the other members of your discussion group.[15
minutes] 14. Ask questions for clarification, understanding.No
Judging. 15. Feel free to change, add, correct your notes, based on
your discussion. 16. Be prepared to talk briefly about what your
group talked about, and any key insights discovered during the
discussion.[General group review and summary 5 minutes] 17. Update
your notes for the next step.IQPC HR Metrics Summit, Sept 13,
2010-Balanced Scorecard Strategies Workshop Presenter: Rick
Buchman
18. The 4 Steps to Implementing Balanced Scorecards
9/13/2010
1. Establish your
Strategy Map
Feed Back Loops
[Quality, Issues, Timing, Performance, ]
2. Design the Legs of
Your Balanced Scorecard
Feed Forward Loops
[Information, Orders,..]
3. Develop Executive &
Department Dashboards
3. Develop Executive &
Department Dashboards
3. Develop Executive &
Department Dashboards
3. Develop Executive &
Department Dashboards
4. Continuously
Improve
Feed Back Loops
[Quality, Issues, Timing,
Performance, ]
Feed Back Loops
[Quality, Issues, Timing,
Performance, ]
7
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
19. 9/13/2010
8
Step 1
Mapping your Strategy
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
20. Strategy Mapping for a Balanced Approach
- What is Strategy Mapping?
21. Maps the key organizational strategies to the Legs of your
scorecard 22. How is it done?Identify the top 3-4 organizational
strategies
Set up a Matrix to align to the 4 Legs (Customer, Financial,
Process, Competencies)
Identify Key Alignments, Actions, and Metrics
Link to and Design Department Dashboards for Real-Time Management
and Adjustment
- How does it add value?
23. Ensures Actions, Focus are aligned to Strategic Direction
24. Enables Real-Time Response and Adjustment to
Changes9/13/2010
9
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
25. 9/13/2010
10
Strategy Mapping for a Balanced Approach
- Key Concepts
26. There is an important difference between an Objective or
Goal, and the Strategy to achieve it. 27. Objective or Goal:This is
the desired End State to be achieved by the organization.It can be
a financial (Make $XX Million Net Profit), Market (Own XX% Market
Share), or any other specific, measurable target. 28. Strategy:This
is the method that the organization will employ, to achieve its
objective or goal. Example:Objective:Achieve 15% increase in Market
Share in 3 yrs.
Strategy: Add new major clients, through:1) Acquiring 3-5
smaller competitors, 2) Converting 20 potential
clients from competitor companies
- KISS Keep It Simple Strategically Strategy should be clear and explainable to anyone within 60 seconds or less.
SM
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
29. HR Current Processes and Practices alignment to Balanced
Scorecard Legs- Survey of 100 Medium to Large Companies
9/13/2010
11
Current HR Processes and Practices are NOT well aligned in a
balanced way to meet
the needs of the business, nor do we see a strong relationship
toward customer
Satisfaction, organizational goal achievement or overarching / long
term strategies.
Source:BBI Study, 2010
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
30. An Example of a Strategy Map
9/13/2010
A Company seeks to increase Market Share through Growth, providing
added
Value to customers through knowhow and performance, and increasing
shareholder
Value through improved Profitability and increased Margin
performance
12
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
31. HR Metrics
HR KeyMetrics Considerations:
HR Capability Requirements of the Organization
Technical skills, knowledge and competencies to design, produce,
deliver, and support the products and services
Other skills and capabilities necessary leadership, project
management, functional competencies (i.e. financial competency,
systems thinking,)
HR Practice skills, knowledge and competencies Career planning/
employee development, coaching/facilitating, problem solving,
conflict management, Communication skills,
HR Processes & Systems
Those processes which the HR department/group manages and executes
to support the organization staffing/hiring, resource planning,
training and development,, compensation and benefits, performance
appraisals, personnel data management, labor relations, succession
planning,
9/13/2010
13
Source:The HR Scorecard Linking People, Strategy and Performance,
by Becker, Huselid and Ulrich, HBS Press, 2001
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
32. 9/13/2010
14
CurrentConsiderations Some thoughts about whats important
Elements of a High Performing Organization
- Leadership- Motivation / Alignment
- Talent- Positive Work Environment
Source:Understanding the Balanced Scorecard; An HR Perspective, by
James Creeland, Copywrite HR.Com 2002
Goal alignment achieving definable Return on Investment (ROI)
To effectively achieve ROI, you must link the training experience
and utilization to the impact on the business, and allow for
real-time adjustment
Source:The Human Resources Scorecard Measuring the Return on
Investment, by Phillips, Stone and Phillips, published by
Butterworth-Heinemann, 2001
5 Core Principles to Effective Talent Management
- People Equity Framework
33.Strategic Focus on Talent Management 34.Align your Talent
Management Practice to Trends & World Environment 35.Measure
Talent Manager per Business Performance 36.Talent
GrowthSource:Reinventing Talent Management: How to Maximize
Performance in the New Marketplace, by William A. Schiemann,
published 2009 by Wiley & Sons, Inc.
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
37. 9/13/2010
15
Strategy Mapping
Small Group Discussion
- Small group discussion:
38. Get into groups of 5-6, sorted by Strategic, Operational or
Tactical. 39. Discuss potential issues for Managing Human Resources
and how best to measure success, relate to Strategy Mapping and the
4 legs of the Balanced Scorecard.Discuss how they might be
addressed.Share your thoughts with the other members of your
discussion group.[15 minutes] 40. Ask questions for clarification,
understanding.No Judging. 41. Feel free to change, add, correct
your notes, based on your discussion. 42. Be prepared to talk
brieflyabout what your group talked about, and any key insights
discovered during the discussion.[General group review and summary
5 minutes] 43. Update your notes for the next individual
exercise.IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard
Strategies Workshop Presenter: Rick Buchman
44. 9/13/2010
16
Strategy Mapping Select Level:
Write down your Objectives/Goals,
and specific Strategies:
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
45. 9/13/2010
17
Step 2
Designing your Balanced Scorecard
Defining and Aligning the 4 Legs
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
46. The Balanced Scorecard
9/13/2010
18
- What is a Balanced Scorecard?
47. Business Multi-Discipline Tracking and Management Tool to
help achieve and sustain desired performance levels , based on 4
Legs:Customer FocusFinancial Performance
Business Process PerformanceEmployee Knowledge, Skills &
Competence
- How is it created?
Determine the key focus areas and measures for each Leg, tied
back to the strategic direction, from the Strategy Map
Decide the Strategic, Operational and Tactical Actions to be
tracked and measured for your group
Design your Balanced Scorecard, get concurrence and
deploy
- How does it add value?
48. Ensures Actions, Focus are linked to key goals, and measured
49. Enables Real-Time Response and Adjustment to ChangesIQPC HR
Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
50. 9/13/2010
19
Tying Strategic, Operational and Tactical to the 4 Legs
VISION / STRATEGIES
STRATEGIC LEVEL
- TIMEFRAME:3 TO 5 YEARS
51. ASSESSMENT 52. SELECTION 53. DEPLOYMENT 54. REVIEW: AT LEAST
MONTHLYOPERATIONAL LEVEL
- TIMEFRAME:1 YEAR
55. ASSESSMENT 56. SELECTION 57. DEPLOYMENT 58. REVIEW: AT LEAST
WEEKLYKNOWLEDGE & GROWTH
FINANCIAL
CUSTOMER
SYSTEMS & PROCESSES
TACTICAL LEVEL
- TIMEFRAME:REAL TIME
59. ASSESSMENT 60. SELECTION 61. DEPLOYMENT 62. REVIEW: REAL
TIME, DAILY, WEEKLYIQPC HR Metrics Summit, Sept 13, 2010-Balanced
Scorecard Strategies Workshop Presenter: Rick Buchman
63. Strategic, Operational and Tactical Focus An Example
9/13/2010
20
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
64. Another Example of a Balanced Scorecard
9/13/2010
21
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
65. 9/13/2010
22
Developing your Balanced Scorecard
Small Group Discussion
- Small group discussion:
66. Get into groups of 5-6, sorted by Strategic, Operational or
Tactical. 67. Discuss different aspects for HR Shared Services and
Outsourcing, relate to the 4 legs of the Balanced Scorecard.Share
your thoughts with the other members of your discussion group.[15
minutes] 68. Ask questions for clarification, understanding.No
Judging. 69. Feel free to change, add, correct your notes, based on
your discussion. 70. Be prepared to talk brieflyabout what your
group talked about, and any key insights discovered during the
discussion.[General group review and summary 5 minutes] 71. Update
your notes for the next individual exercise.IQPC HR Metrics Summit,
Sept 13, 2010-Balanced Scorecard Strategies Workshop Presenter:
Rick Buchman
72. 9/13/2010
23
Developing your Scorecard Select Level:
Enteryour Key Performance Metrics (KPM) related to
each Leg of your Balanced Scorecard from Step 2:
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
73. 9/13/2010
24
Defining the 4 Legs of the Balanced Scorecard
Enteryour Strategies down the left side.Then, in each box, identify
a specific initiative that will support achieving each strategy
related to the specific Leg of your scorecard.
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
74. 9/13/2010
IQPC HR SSO Summit, May 10, 2010-Balanced Scorecard Strategies
Workshop Presenter:Frederick S. Rick Buchman
25
A Potential Risk with HR Metrics
How good is your data?
How can you know?
How do you ensure your information is reliable?
- Utilizing Measurement Systems Analysis (MSA)
75. Resource multiple sources validation 76. Check often, always
ask where the information came from, and what is the basis for any
conclusions or decisions made 77. Use the Smell Test if it smells
or feels funny, dont just accept or act on it, check it out to be
sure, especially if it is something different or particularly
interesting.The criticality of the decisions that depend on this
information demand reliability, which requires rigorous discipline
in ensuring the highest levels of quality and accuracy.
78. 9/13/2010
26
Step 3
Develop your Dashboards
Executive/Organization
Department / Division
Section / Workgroup
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
79. The Dashboard
9/13/2010
27
- What is a Dashboard?
80. Visual Management Tool that provides Real-Time critical
information on key business measures, to enable timely decisions,
based on the 4 legs of the Balanced Scorecard:Customer
FocusFinancial Performance
Business Process PerformanceEmployee Knowledge, Skills &
Competence
- How is it created?
Assess your business operation/process, and determine what you
would need to see on an on-going basis, in order to assess the
health of your operation/department, as related to each of the 4
legs
Design your Dashboard to provide Real-Time, up to date intelligence
on these measurements
Install the Dashboard, test it, and improve on it, and make it part
of your daily management system.
- How does it add value?
81. Ensures Actions, Focus are continually aligned to key
performance goals 82. Enables Real-Time Response and Adjustment to
ChangesIQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard
Strategies Workshop Presenter: Rick Buchman
83. 9/13/2010
28
Developing your Dashboard
- Consider various ways to portray, arrange and display your visual and graphical indicators.
84. Important points: 85. Must clearly indicate when something
requires attention 86. Should be simple 87. Easy to understand 88.
Flow naturally 89. Use Color, different shades 90. Updated in real
time 91. Flexible to requirements changesIQPC HR Metrics Summit,
Sept 13, 2010-Balanced Scorecard Strategies Workshop Presenter:
Rick Buchman
92. Example of Exec, Mgmt and Workgroup Dashboards
9/13/2010
A Real State Department of Human Services Finance set-up
29
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
93. Dashboard Example Ad Group
9/13/2010
LEGEND:
Home page
Dept Web Pages
Key Points:
- Lots of Color, Graphics, Charts, clearly labeled, and well understood by all.
94.Set up so that an executive or manager can look it over
quickly, and shouldbe able to spot something out of whack
immediately.30
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
95. Example of a Dashboard for an Airline
9/13/2010
31
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
96. 9/13/2010
32
Strategy Mapping
Small Group Exercise
- Small group Exercise:
97. Get into groups of 5-6, sorted by Strategic, Operational or
Tactical. 98. Imagine you are members of an HR Shared Services
organization.As a group, on a Flip-Chart, lay out a Dashboard,
considering everything we have discussed. Be sure to include
aspects related to all 4 Legs of the Balanced Scorecard, but
specifically to your level and how you would measure your
organizational performance. [15 minutes] 99. Be prepared to talk
brieflyabout what your group talked about, and any key insights
discovered during the discussion.[General group review and summary
10 minutes] 100. Update your notes for the final individual
exercise.IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard
Strategies Workshop Presenter: Rick Buchman
101. 9/13/2010
33
Developing your Dashboard Select Level:
- List various visual and graphical ways to show current and updated status of your metrics, for each Leg, based on the metrics you chose for your Scorecard.
102. Suggestions:- Red, Yellow, Green Indicators - Gauges,
Meters
- Bar, Pie, Line, Radar Charts- Combinations
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
103. 9/13/2010
34
Developing your Dashboard Select Level:
- Layout your Dashboard:
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard
Strategies Workshop Presenter: Rick Buchman
104. 9/13/2010
35
Wrap up
- What we covered today:
105. Understand the fundamentals of the Balanced Scorecard and
Dashboard System for Management 106. Develop a Framework for
Mapping your Strategy 107. Devise the Elements for each Leg of your
Balanced Scorecard 108. Design and layout a Dashboard for your
particular level and management requirements 109. Where you can go
to get more information: 110. Web 111. Books 112. Industry Examples
113. Other Resources 114. Remember.. 115. No One answer for you,
many different ways 116. Try something, and then adjust, but get it
out there soon, and dont be afraid to make changes and adjustments
117. Keep it Simple, Clear, Effective.Use the 20 second ruleIQPC HR
Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman
118. 9/13/2010
36
- Your PresenterFrederick S. Rick Buchman
Mr. Buchman has over 25 years hands-on international strategic,
operational and organizational transformation experience, spanning
multiple industries from missiles and electronics to medical
devices. A certified Black Belt and Master Black Belt in Lean Six
Sigma, He has been directing business improvement initiatives
involving Strategy Planning, Lean and Six Sigma, Balanced Scorecard
and Dashboard deployment, Operations, and Organizational
optimization for over 20 years, both internally and as a contract
consultant, supporting the automotive, electronics, semiconductor,
oil & gas, electromechanical, medical device, commercial and
components industries, and working with Engineering, Operations,
R&D, Finance, HR and Legal divisions. Rick has also taught
extensively at the graduate level for major institutions, including
The Eli Broad Graduate School of Management at MSU, and at Towson
and George Mason Universities, in strategy planning, problem
solving, business management, value stream mapping, balanced
scorecard and dashboard strategies, coaching and team
leadership.His clients have included AT&T, Raytheon Corp.,
Hughes, Texas Instruments, Ford Motor Company, Allied-Signal, ITT,
Husky Oil, Slumberger, Gerdau, Remy, Dura GmbH, GKN, and several US
State and Federal Government agencies.A retired 28 year US Army
Officer, Mr. Buchman has a B.S. in Mathematics, an MBA in Business,
and a PhD (ABD) in Business, and has been featured in International
Whos Who in Business, 2006, and recently presented at the HR Shared
Services Summit earlier this year in May in Chicago.
Rick recently co-authored the Amazon Productivity Best-seller
Balanced Scorecard Strategy for Dummies, with Mr. Charles
Hannabarger and Mr. Peter Economy, published by Wiley and Sons,
Inc. in September 2007 (English Language), and again in March 2008
(Dutch Language) and September2008 (German Language). This book was
also just recently voted 5th out of the Top 20 Must-Read Books by
the Channel Insider Community, May 5, 2010, and #2 of Business
Productivity books by Amazon, Sept. 6, 2010. Mr. Buchman currently
resides in Louisville, KY.
IQPC HR Metrics Summit, Sept 13, 2010-Balanced Scorecard Strategies
Workshop Presenter: Rick Buchman