Strategy maps 101 - Why measures in perspectives always fails
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- เผยแพร่เมื่อ 28 ก.ย. 2024
- Why do so many balanced scorecards fail? Because they don't understand that the common 4 perspectives balanced scorecard model is mis-leading and does not work. Phil Jones of Excitant Ltd, www.excitant.co... explains why the 4-perspective model fails and how strategy map structures were developed. Understanding the principles that lead to the strategy map will help ensure your balanced scorecard implementation will be successful and address strategy and change rather than merely performance measurement. Find out more at www.excitant.co...
Mr. Jones your explanation of the BSC has made it much easier for me to understand. I am currently on this topic as my capstone before receiving my BSBA. I have been struggling with this topic from the beginning and that is because the school started out teaching the old model. It just does not make much sense. You have brought much more clarity to the whole process. Thank you so much. Now, I will not fail this course.
I'm a final year business student and the lecturer still uses the old balanced scorecard. She is not very approachable and would not take kindly to being told she is 20 years out of date. i have my exams next week and I'm fairly sure this topic will come up, thanks for this easy to follow example. The shocking thing is I done a presentation on Blue Ocean strategy and she marked me down as she did not know what it was even though it is in our prescribed course book?
Thank you M Phil Jones your presentation is excellent and very clear. It's very useful for me.
Nice & insightful presentation Phil.
Excellent presentation and a very clear explanation.
Thank you very much.
Thank you Mr Jones for the clarification. I am taking the course relating to this video and it has made it clear.
Phil, would you be willing to do an updated version of this great video?
Thanks for uploading this video! It's loaded with practical, experience-based knowledge.
Brilliant and sufficiently understood analysis!
Brilliantly explained ... Kudos
Great video ... very useful for Management accounting student
Very clear presentation, Thanks a lot, spared me much time and confusement.
Would be great if you could update this presentation
What do you want as an update? All this is all still valid and many organisations and consultants still make the basic mistakes that I point out here. If you really want more information - visit my website. www.excitant.co.uk where you can read about the overall Fourth Generation Strategic Balanced Scorecard approach.
Hi Phil,
I liked the content of your video so much that I have embedded it on our website on a page about What is strategy? I hope this will get you lots more traffic as it will get me lots of satisfied customers! Thanks for the great explanation!
Best wishes
Martha
business-online-learning
From the number of views this is not the most popular video on the subject but one with better content that actually follows the intended process to develop a BSC. As an experienced practitioner, the strategy map is the most important part of the PROCESS to develop a scorecard. It does need to be SIMPLE (simplified though focus by making tough strategic choices of the vital few CSF's / objectives) but NOT SIMPLISTIC (a picture of categories of measures that are not a cause and effect model). Once this cause and effect relationship diagram is completed, only then should the measures / KPI's be tackled as is said in the book and repeated in this video. If developed correctly the strategy map of integrated objectives will then lead almost automatically to a hierarchy of integrated cascaded measures. I have seen many "BSC" attempts that have been developed without ever considering the strategy map and it is not surprising that they don't survive. The one thing that is not available in the literature is a correlation of strategic objectives that allows the leadership team to assess and evaluate the overall impact of alternative initiatives have on the selected strategy.
Thank you Kenneth,
Hi Ek, if teh overall goal is not profitablity (as in many cases) then there are ways to handle it. See my blog for details, especially in a NFP organisation.
Hi Phil. In my organization, the top part is customer and finance is at the bottom bec we are a government agency... my question is do we really have to have finance on top?
By the way... I like you4 explanations. Thank you for sharing.
You are treating finance as an input. Typical accountants approach :) You have a responsibility for financial outcomes, you just call it surplus, (not profit) so it needs to be at the top ALONGSIDE custpmer (community) and social/environmental impact. (you may have some dvelopmental needs in finance, but that is simply one of many learning and growth capabilities to develop. Go to my website excitant.co.uk and search for public sector or third sector/NFP strategy maps. There is a whole section of my book on these as well.
A three part answer: 1) Having finance at the bottom is a typical accountant's view that the whole organisation is driven by the funds available. Putting leraning and growth at the bottom supports the question - what do we have to do to make this organisaton better by learning and growing new skills, knowledge and cultures.
2) Having finance at teh top dows not make it the ultimate target. The target of the organisation (Process to customer layers) even in the public sector is serving the community. Doing that efficiently is a consequence of the services. So the Financial consequences are not the ultomate target but a consequence of teh pay off between customer/community service and the costs of that setvice. Create surpluses and they are available for re-investment.
3) You better need the three part top layer: 1) Community/Customer - alongside finacial outcome and a third which represents environmental and social impact. See my book "Strategy mapping for learning Organizations£, or my website www.excitant.co.uk/fourth-generation-balanced-scorecard-approach/
Dear Friends,
If a company have many strategies: buy another company, build new factory, buy new warehouse, and I want to write it in a strategy map. How will I write?. Thanks.
These sund as if they are multiple strategy maps at different levels. Do not try to put all in one strategy map. Corporate mergers/acquisitions may be at different levels to mangfacturing/warehouse expansion. At the top level - you have growth in two ways. Lower down will be teh detail of the build new factory and buy new warehousing.
Very useful for me.
this was excellent
You can find over 200 articles and posts by me, Phil Jones, at my website (see the video description for links)
can we have our own perspective based on our strategy?
Hana, I STRONGLY recommend you do NOT introduce a load of perspectives based on your strategy: rather lay your strategy across the perspectives, using the existing perspectives to explain aspects of your strategy. Think of your strategy sitting on top of the perspectives. (The video does say beware of trying to add extra perspectives and losing the underlying cause and effect model)
To get more detail I suggest you read my book, "Strategy Mapping for Learning organizations" which explains how to do this in detail. www.excitant.co.uk/resources/books/book-strategy-mapping/
Good luck Phil
I suggest you try again Hany, as most people get through to the full almost 20 minutes.
Excellent!
Quite a lot to process here. Excellent content however I do believe the text on screen is distracting, while you are talking - you should either stop at a new slide or simply discuss specifically.
Thanks you Bing :)
Hi Gary. The problem with many academic courses is that you have to demonstrate you learnt the material from the course. Then you have the right to talk about later developments. I made the same mistake ages ago - trying to show i knew more than the curriculum. The art is play the exam game and then apply what you really learnt to your business and real life. Good luck gary.
Thanks Phil so explaining BSC in a very clear way. Even those with zero knowledge will be able to easily understand the concept.
You are welcome
Wonderful
Great. It is clear.
Thanks Phil Jones, for your excellent presentation. Now i'm able to keep writting my thesis on the right path. Thank you!
very insightful. Thank you
Fantastic video well done. I guess we still have to do some work if the overall goal is not profitability
Perfectly presented!!! Very clear links between different units of the organization. the process gives meaning to every person's contribution and they know how their performance (or lack thereof) impacts the accomplishment of organizational objectives and its business. Thank you so much!
Now I understand why BSC did not appeal to me in its earlier introduction. I am a stickler for strategic planning and BSC just solidified what I have been learning and practicing for the past decades (from MBO to 4Dx and OKR). This version of BSC is comprehensive and simple. My left brain is satisfied. ^_^
Thanks Ruth. So many tried to copy the strategic balanced scorecard, missed the point, adopted simplified versions or simply choose not to read past page 9 of the very first book. I am pleased you found this so useful and clear.
Excelent!
well done Phil
I would very much appreciate links to any articles with Phil Jones as author on this subject.
I checked google scholar and didnt find anything. This is just great knowledge that I could use in my university papers on strategy.
Would it be possible to find any articles anywhere from this author?
Just go to my website www.excitant.co.uk there are over 300 blog articles there.
Thank you. very useful
Thank you
Thank you Patrick. You can find out more on my website www.excitant.co.uk, Cheers, Phil
Being and Indian there is always a flipside of me inclined towards the British people...It is good to think as a Brit...Splendid Cracking the nutshell....Phil(anthrophy) of Knowledge...
Great presentation. Clear explanation. Nice build-up.Well done and thank you!
Outstanding! Helpful in understanding and writing applying bloom taxonomy in analyzing hospitals scorecard
sir, i have a question : does the perspective has causality relationship between each others?
Thanks so much Phil. Your video is really helpful.
Thank you soo much.. Really really helpful
Hi first of all, thank you for this video :) I would like to ask if an objective (process perspective) can directly link to an objective (finance perspective) without linking it to an objective(customer perspective). Thank you :)
Hi Gocke, yes, you are right and of course they have a different meaning. I may have put in on the video, but (Put simply) there are basically two components to the finance piece - income (from your customers) and costs (from your processes), so yes it is normal (on more detailed strategy maps) to have some links to objectives from customers - "If they are happy they will give you money" and from internal processes "If this is produced more economically, then it saves costs". I hope that makes sense. Have a look in my book as it explains this in much more detail "Strategy Mapping for learning organisations" www.excitant.co.uk/resources/books/book-strategy-mapping/ . There is plenty of other stuff in my blog as well.
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Thank you so much for doing this video. I am taking a graduate class that requires me to complete both a strategy map and scorecard. The instructor did not explain it as clearly as you did!
Thank you Tara, I guess doing it for 20 years in practice helps me explain what is actually going on (as opposed to a theoretical understanding from a book)
Your video is spectacular, incredibly helpful and I'm thankful to know this wisdom of yours! Thank you!
Thanks
Thank you Phil. This is very helpful. I got an understanding that will last me a life time.
You are welsome
Thanks rmolag :)
Nice job sir ! :)
Yes, great video.