balanced score card-lbi

8/10/2019 Balanced Score Card-LBI

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Balanced Score Card

Dr A. P. DashPower Management Institute


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BALANCED SCORECARD

To succeedfinancially, howshould we appear toour shareholders

To achieve ourvision, how shouldwe appear to ourcustomers?

To satisfy ourshareholders andcustomers, what

business processesmust we excel at?

To achieve ourvision, how will wesustain our ability tochange and

improve?

Visionand

Strategy

Financial

Customer

Learning and Growth

Internal Business Process


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The source of value creation has shiftedfrom Tangible to Intangible assets

1983 1993 2003

Tangible 62% 38% 15%

Intangible 38% 62% 85%

IMPACT OFMEASURES -

BALANCEDSCORECARD


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Voice of the Employee

THELEARNING & GROWTH

PERSPECTIVE

Voice of the Business

THE

FINANCIALPERSPECTIVE

Voice of the Customer

THE

CUSTOMER

PERSPECTIVE

Voice of the Process

THEINTERNAL BUSINESS

PERSPECTIVE


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Finance

Measures Revenue

ROCE Profit Cost

EVA


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Customer To achieve our vision, how should we appear to

our customers in terms of Product attributes Brand Relationship with the customerin the targeted segments

Measures Customer Sat/retention/expansion Value delivery - to customer Market/segment share


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Learning and Growth

To achieve our vision, how will we sustain ourability to change and improve in terms of People Systems Infrastructure

Measures Employee Satisfaction & Retention Skills - inventory & build up Investment in strategic systems


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Balanced Scorecard

BALANCES


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Leading and Lagging Indicators Leading Measures - Performance Drivers

Before the damage is done Help take midcourse correction

Examples Kms walked/week Total Cholesterol/HDL ratio Employee satisfaction


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Criteria for setting goals

S pecific M easurable Achievable R elevant

T ime Bound


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Scorecard - Cause & Effect

Profit

CustomerLoyalty

On-timedelivery

Process

Quality

Process

Speed

EmployeeSkills

Finance

Customer

Internal Processes

Learning and GrowthStrategicSystems


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The BSC Strategy MapCAPTURES THE KEY CAUSE & EFFECT HYPOTHESES


CUSTOMERPERSPECTIVE

PROCESSPERSPECTIVE

LEARNINGPERSPECTIVE

Improve Shareholder ValueGrow Net Revenues Improve Resource Productivity

Grow thecustomer base

Improve customerprofitability

Improve coststructure

Improve assetutilization

Acquire newcustomers

Retain existingcustomers

Increase segmentpenetration

Improve ServiceAttributes

Improve customersatisfaction

Improve customerrelationship

Communicate corevalue proposition

Innovate newproducts/services Improve operatingefficiencies Reducewaste

Prepare & educatethe work force

Build relationshipmanagement skills

Build a pro-activeempowered culture


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Strategy Map


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LEARNINGPERSPECTIVE

CUSTOMERPERSPECTIVE

PROCESSPERSPECTIVE


Improve ResourceUtilization

Providing Learning Solution toBusiness Problems Increasing Value From Faculty

Retaining, increasing revenue from existingcustomer; Acquiring new customer

Growth Of Demand oforganised Programs

Increase ROTI

Revenue/Investment

Business Growth Increase Cost Competitiveness

Objective Fulfilment from Training ProgramImprove customer satisfaction

Increasing Value From Faculty

Positioning of PMI,Brand Building

FacultyCompetenciesDevelopment

TrainingAdministration

Taking upBenchmarkingprojects

Environmental Scanand BusinessIntelligence

Design, delivery,program

FacultyValueProposition

DevelopingMarketingTeam

RobustTNAProcess

HR-AdminSupport

PMI- BSC Strategy Map Internal & External Customers


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The Strategy Map

An example: Telephony Service

provider


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Improve XYZ Cos Return on Capital Employed

Revenue Growth Strategy Productivity Growth Strategyunderstand customers needs maximize the use of existing asset

and differentiate accordingly integrate the business to reduce total delivered cost

e

*revenue from VAS *Services used compared with *VAS cost compared *Actual cash flow*Profit margin the rest of the country with the rest of the country compared with

business plan

FinancialPerspective

Introduce new sourceof Revenue through

Value Added Services

Sell Sticky VASservices to helpCustomer tocommunicate better

Become the IndustryCost Leader in everyServices we Provide

Maximize the use

of existing assets

CustomerPerspective

PriceBill

Plan

VASFast

Activation Friendlyhelpful

employees

Recognizecustomer

loyalty

TrustedBrand

Offer moretypes ofservices

Help dealersdevelop their

businessskills

Product/Service attributes Relationship ImageWin Win Dealer Relations

* Dealer Profitability* Dealer Satisfaction

Delight the customer


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Improve XYZ Cos Return on Capital Employed

Revenue Growth Strategy Productivity Growth Strategyunderstand customers needs maximize the use of existing asset

and differentiate accordingly integrate the business to reduce total delivered cost

e

*revenue from VAS *Services used compared with *VAS cost compared *Actual cash flow*Profit margin the rest of the country with the rest of the country compared with

business plan

FinancialPerspective

Introduce new sourceof Revenue through

Value Added Services

Sell Sticky VASservices to helpCustomer tocommunicate better

Become the IndustryCost Leader in everyServices we Provide

Maximize the use

of existing assets

CustomerPerspective

PriceBill

Plan

VASFast

Activation Friendlyhelpful

employees

Recognizecustomer

loyalty

TrustedBrand

Offer moretypes ofservices

Help dealersdevelop their

businessskills

Product/Service attributes Relationship ImageWin Win Dealer Relations

* Dealer Profitability* Dealer Satisfaction

Delight the customer


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BSC Matrix

The one page communication system

of strategies, goals, projects andinitiatives


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The Balanced Scorecard Matrix

RecruitmentProfiling tool

New productidentification pilotproject

5 relationship execsby Sep 02

100% Mktg execscertified on newprocess by Dec 02

Relationshipteam in place

Learn newproductdevelopment

Relationshipskills

Product devt.skills

LEARNING

BenchmarkingRelationshipmarketing & Newproduct devt.processes

90% compliance toplan elements

Avg. cycle time fromconcept to launch

balanced score card-lbi

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