the balanced scorecard: critical reflections on the …

The Balanced Scorecard 1

THE BALANCED SCORECARD:

CRITICAL REFLECTIONS ON THE MOVE TO IMPLEMENTATION

By

PAULA CARSON

Integrated Studies Project

submitted to Dr. Richard Marsden

in partial fulfillment of the requirements for the degree of

Master of Arts – Integrated Studies

Athabasca, Alberta

September 30, 2008


The Balanced Scorecard: Critical Reflections on the Move to Implementation

Abstract

This research essay is aimed at providing an overview of a management system “The Balanced

Scorecard” and how the system has been initially adopted by Northern Lakes College, a not-for-

profit educational institution. This was done in response to a need to inform the College

Business Plan and help focus resources and energy in a changing environment. The tool was

chosen as it appeared, on the surface, to be one of the least complex and adaptable systems

currently offered. The latest in a long line of management systems, the Balanced Scorecard, is

available in both for-profit and not-for-profit versions. The tool’s strength lies in that it brings

together all factors involved in attaining an organization’s mission, a more balanced approach.

Its limitations include the fact that it is a “top down” system which may by that fact alone make

it more difficult to implement and like anything that stands a chance of success there is a need

for sustained care and attention by all employees. The Balanced Scorecard concept was

successfully used in developing the Northern Lakes College Strategy map for 2009-11, the first

step in management-level implementation. A tentative schedule for department implementation

is provided.

Introduction

In the fall of 2007, management personnel at Northern Lakes College began the process

of implementing a strategic management system. This system is the “Balanced Scorecard.”

College administrators had been searching for a method or system that would assist them in

sorting, prioritizing and aligning the initiatives developed by the College departments with the

strategic directions set by the College Board of Governors. Initiatives are those activities chosen

to help realize the larger, overarching goals of the college. Further, it was determined that there

was no plan to measure the initiatives. Without measurement, can success be gauged? Some

initiatives had been developed in isolation--having not been linked to one particular strategy and

with no connection to other initiatives. The College Senior Management team anticipated using

what knowledge resulted from the Balanced Scorecard exercise to inform the Northern Lakes

College business plan. A consultant was hired to begin the process, and he met with a large


group of managers over a two-day period with less than optimum results. This essay will answer

a number of questions. What is the Balanced Scorecard? Why would this tool for strategic

management be chosen? How would it be implemented? This research essay will also critically

reflect on the experience of adapting the Scorecard and preparing for its implementation in the

Northern Lakes College system. As a middle-manager, it will be my responsibility to implement

the Balanced Scorecard in my department, University and Professional Studies, at Northern

Lakes College.

Northern Lakes College

Northern Lakes College has a unique history that is founded in partnerships. These

partnerships began in the early 1970s when the vocational high school situated in the small,

northern community of Grouard, became Alberta Vocational Centre-Grouard and began training

para-professional adult educators called Education Technicians. The Education Technician

trainees were selected by advisory committees in their communities, and would later work in the

communities. These communities had and still have commonality, they are isolated, sparsely

populate, north of the 55th

parallel and predominantly Aboriginal. As the Ed Techs attended

class, approximately a dozen communities built their own educational facilities, where the Ed

Techs would eventually work. The selection committees later became known as Community

Education Committees. The partnership between the institution and the communities lead to the

tradition that the College grows from and belongs to the communities and that the communities

and the College are responsible to one another.

Over time the Community Vocational Centres (CVCs) and Alberta Vocational Centres

joined forces, more partner communities joined and the College metamorphosed into a board

governed public institution, called Northern Lakes College. There are between 26 and 30 small

campus sites and two larger administrative sites. The sites are scattered across the north-western

corner of Alberta from one hour north of the provincial capital to the 60th

parallel. Some of the

sites are the adult education equivalent of the one room school house. The College success is in

its use of distance education technologies, synchronous audio graphics and videoconferencing,

asynchronous Web-based learning opportunities and old fashioned paper-based learning with

face-to-face support, portable simulators and not so portable labs, to bring a surprising array of

coursework to the partner communities.


The College success is also one of its challenges. Although the priority and focus is

always education in the communities for the communities, how, where and when this is done

causes constant change in priorities. Along with many great things said about the College by

employees words such as dominos, house of cards, shifting sand, Mad Hatter’s Tea Party are all

descriptors for the College work environment. Some changes are caused by internal factors but

more often lately, change is driven by outside forces such as the goals of the province and the

ministry, which departments will fund what initiatives, when and where. How is it accounted

for? The stress of the competing priorities and the 390 employees (this number includes all

levels of management, faculty and staff) in remote locations needing to be everything to

everyone is causing edges and tempers to fray. The College senior management team believed

that something needed to be done to gain a sense of control for the sake of the College and those

who keep it moving.

The Balanced Scorecard

The concept of the Balanced Scorecard originated from the 1990 research of Robert S.

Kaplan and David P. Norton. Kaplan and Norton’s research was in response to changes in

corporate environments--the industrial age had become the information age--and there had

developed a need for a more comprehensive overview of corporate success. Until this time,

financial gain was a primary indicator; a company that showed financial profit was a successful

one, at least in the world of American big business. Over the period of one year, 12 companies

which were believed to use leading-edge performance indicators were studied. Although the

indicators had different names and priorities, the research indicated four common themes used to

monitor performance. These themes or perspectives were financial indicators, customer

satisfaction, internal processes and the activities of the organization that encouraged innovation

and/or improvement. In 1992 Kaplan and Norton began publishing a summary of their findings

in the “Harvard Business Review” (Jan/Feb, 1992). The findings were published in their entirety

in the 1996 text “Translating Strategy into Action: The Balanced Scorecard.”

The initial focus of Kaplan and Norton’s research was to determine measurement strategies

for corporate success. They proposed that, in order to properly measure the success of an

organization in achieving its goals, there must be a general balance between long- and short-term

objectives, financial and non-financial measures, external and internal performance indicators,

and lagging and leading indicators. Lagging indicators are the result of leading indicators; for


example, a leading indicator might be improved customer service, and the resultant lagging

indicators would be increased sales and increased profits. The measurements must align with the

organization’s strategic objectives. As a greater number of corporations adopted the Balanced

Scorecard for measuring purposes and discovered its usefulness, the single-purpose measurement

system quickly evolved into a corporate management system. As part of this management

system, according to Kaplan and Norton, objectives and measures are “derived from a top-down

process driven by the mission and strategy of a business unit,” and not an ad hoc process of

development (pp. 8-10). The linkages between the four perspectives highlighted the need to

recognize the “cause and effect” of changes. The Scorecard’s purpose is not only to determine

financial value but to articulate other value drivers that are apparent in knowledge-based

industries. The Balanced Scorecard uses a framework for the four perspectives--financial,

internal business processes, customer satisfaction, and learning and growth--to determine lead

questions that must be answered by an organization and the units that make up the whole. These

questions are:

Financial - In

order to succeed financially, how should we appear to our shareholders?

Internal

Business Process – To satisfy our shareholders and customers, what business processes

must we excel at?

Customer

satisfaction – To achieve our vision, how should we appear to our customers?

Learning and

Growth – To achieve our vision, how will we sustain our ability to change and improve?

Kaplan and Norton formulated a simple diagram to illustrate the four perspectives, and

how the perspectives link to one another and to the organization’s vision and strategy (see Figure

1). They suggest that all organizations develop and adapt their own diagram to help focus

energy and resource distribution.

Figure 1


Traditional financial measurement reports only on what has gone before. This is seldom

a good indicator of future success. Although not the first to include measures other than

financial ones, Kaplan and Norton propose that a Balanced Scorecard approach will help

information-age organizations work to the future through investment in people, technology,

processes and innovation. In the early 2000s the pair introduced the concept of strategy mapping.

A strategy map indicates the “chains of cause and effect” linking actions across perspectives, and

giving them a visual form (Kaplan & Norton, 2000). The “cause and effect” indicators are what

the authors propose for using the Scorecard as a tool for strategic performance management and

organizational change.

Salterio, Professor of Business at Queen’s University School of Business, and Webb,

Associate Professor of Accounting at the University of Waterloo’s School of Accountancy,

report that the perceived desire for such a tool is so strong that some 50% of Fortune 1000

companies are using the Scorecard in one form or another. AT&T Canada, Bank of Montreal,

Best Foods Canada, BC Hydro, Nova Scotia Power and Nova Chemicals are some of the

Canadian adoptees (August 2003). Hendricks, Menor and Wiedman in their 2004 work for the

Ivey Business Journal reported that a Bain & Company survey found that, of the 708

international companies they contacted, 62% were using a Balanced Scorecard (p. 1). The

numbers of adopters in Canada and internationally reflects a perceived need for a tool that

measures factors to success including, but not limited to, financial return, and many firms tout


the Scorecard’s benefits. There has been little actual hard research, however, to back the belief

that the Balanced Scorecard is that instrument (p. 3). Hendricks, Menor and Wiedman believe

that the need for management tools will support the future adoption of the Balanced Scorecard,

and they offer guides for implementation shared by those who have implemented the Scorecard.

Some of the recommendations include obtaining senior management involvement; articulation of

vision and strategy and linking them to short, medium and long-term goals as well as leading and

lagging performance measures; cascading the scorecard; viewing the Scorecard as needing

maintenance, reassessment and updating; and finally, believing that it can be the facilitator of

organizational and cultural change (p. 6).

Critical View

Norreklit (2000) provides a critical analysis of some of the Balanced Scorecard’s

assumptions. The author looks at the degree to which the cause and effect relationship between

the indicators exist. He examines whether or not the Scorecard can link strategy to operation in a

format that managers can understand and implement, and then he goes on to suggest some

changes for improving Scorecard. Norreklit believes that there is risk involved in the assumption

of a cause and effect relationship when planning for or measuring success. Cause and effect is

problematic as it can really only be gauged after the fact when an action is found to be successful

or not. Also, the timing or environment may be wrong causing the action to have an effect other

than what was projected (pp. 71-76). Brignall (2002) agrees with Norreklit in his critique of the

“cause and effect” relationship between the four perspectives; he, too, believes that the

perspectives are not linear but interdependent.

A second argument that Brignall (2002) makes is that power relations will cause the

Scorecard to be unbalanced. In Brignall estimation the shareholders in a corporation are

normally the most powerful group with a perspective to be satisfied; greater corporate resources

naturally flow to meet their needs (pp. 85-92). Others suggest that the power is held by senior

managers. Extrapolating from this, it likely does not matter who holds the power as much as it

matters who they most wish to serve with this power. Balanced Scorecard performance

measures designed to indicate success in meeting shareholder or highly paid managers (added)

needs--financial success--take priority over other performance measures causing an imbalance.

Concern is expressed regarding the lack of monitoring of competition and other market factors

that may invalidate strategy. Norreklit (2000) proposes that--along with the question “what can


be done well to realize an objective?”--another question should be asked: “what assumptions and

shocks can prevent the realization of an objective?” (pp. 71-76).

Norreklit also draws attention to the assumptions of compatibility between the methods

of the Scorecard, which are hierarchical, top-down and rigid, and the implementation of the

methods which must be understood and carried out by lower level employees. The Scorecard is

based on the assumption that the organization’s strategy has been correctly formulated by

management and “that the plan is the right one” (p. 78). This assumption is obviously

problematic.

Since it was first conceived, much has been written about the Balanced Scorecard and

how it should be implemented--the Scorecard’s values and pitfalls. Mohan Nair (2004) provides

a simplified but complete writing on the Scorecard, its purpose, and strategies for its

implementation. Paul Niven (2006) provides much the same work as Nair but begins at a more

theoretical level, then attempts to take the reader from theory to hands-on implementation. The

preponderance of literature on the subject of the Scorecard, Bremser and White (2000), Norreklit

(2000) and Speckbacher, Bischof and Pfeiffer (2003) to name but a few authors, is based on and

aimed at the experiences and needs of the corporate world.

Accountability has become one of the buzz words of our time. Corporate accounting scandals

such as those discovered at Enron, and other business giants, along with the knowledge that old

practices were not working has caused legislators to become more cautious than before (Niven,

2003, p.4 & 24). The resulting fallout has been that non-profit organizations and governments

are being asked to justify what they have done or are doing with the resources, both human and

financial, that have been provided to them by the tax-paying public. An example of this from the

experience at Northern Lakes College is the annual influx of auditors who will spend five weeks

of each year examining every aspect of College management. The auditors ask to see not only

the finances of the institution but the institutional policies and as some are incredulous to see,

policies on policies including how often they are to be reviewed and rewritten. Niven presents

the argument that there are a great many similarities between the activities and challenges of for-

profit organizations and those of government and non-profit agencies. He offers the Scorecard

as a tool, a framework for moving big-picture strategies into operational objectives, and for

monitoring progress in achieving objectives. This becomes a strategic management system for

the non-profit organization or government agency (19).


Niven (2003) proposes that the primary difference in the Balanced Scorecard for the

corporate world and the Balanced Scorecard for non-profit and government agencies are the

goals to be achieved by the organization. In the corporate world, the focus or goal is profit for

the shareholders, while in the non-profit world the ultimate goal is the achievement of the

group’s mission (32). The customers are still those whom the organization would serve. In

education, for example, students are the primary customers, followed by funders and regulators.

There is a difference in the “product” demanded by the customer groups. As with many non-

profit organizations, an educational institution has a degree of control over the product which is

provided for the student and can control this within limitations or make changes to meet

community and other requirements. There is little an educational institution can control when it

comes to the “product” demanded to satisfy the requirements of governments and regulatory

bodies other than to continually gather and organize information to make reporting easier.

Stewart and Carpenter-Hubin (2001-02) in their work on the use of the Balanced

Scorecard in higher education support Niven’s claim that focus on the mission or vision of a non-

profit organization is paramount. The authors believe that, although much the same data is

required for reporting to external stakeholders and internal assessments, more attention must be

paid to the context and goals of the educational institution in order to develop valuable internal

performance indicators; for example, is the institution moving to meet its mission? In their

words, “[t]he real test for institutions is to create meaningful systems for strategic organizational

assessment and then use that information in internal policy and resource allocation” (38).

Performance indicators must be tied to the goals and values of an institution and flow from the

institution’s objectives or mission statement. The authors believe that, by making a slight

change in the paradigm of the Balanced Scorecard, it is possible to adapt the tool for use in

higher education. Essential to the use of the Scorecard in non-profit organizations is the linking

of the larger goals to the problems to be solved, issues to be considered, decisions to be made,

and the resources available for allocation in order to support the strategies. Identifying these

linkages assists administrators in setting priorities and developing ways of measuring the

institution’s progress in meeting the larger institutional goals. As in the business context, the

Scorecard has governments and non-profit organizations take a wider view of the organization

from the four perspectives--financial, customer, internal process, and learning and innovation.


This holistic approach provides better, more complete, information related to “cause and effect”

in the decision making process (42).

The Northern Lakes College Experience so Far

Balanced Scorecard promoters such as Kaplan and Norton, Nair and Niven propose

strategies for working through the process of implementing the Scorecard. The authors claim to

have guided many organizations on their journey, and their methods are likely the most efficient,

having been used with many others. They use words such as systematic (Kaplan & Norton, 1996,

p. 295). Northern Lakes College, an institution at the very beginnings of the process, has already

taken a few bumpy detours, but lucky happenstance has eased some of the potential difficulties.

A primary issue, according to Kaplan et. al., is convincing an organization’s senior leadership of

Scorecard benefits and gaining their continued, long range support. The authors describe a

number of Scorecard ventures put together by high level managers. Although the authors

believed the managers’ efforts to be well developed and directed, and reflective of the needs of

the organization moving forward, those at the highest level of leadership were not convinced of

the tool’s usefulness, and thus the entire venture collapsed (Kaplan & Norton, 1996, p. 294).

This problem was avoided at Northern Lakes because the search for a tool was initiated by the

highest leadership in response to a defined need.

Annually, organizations such as Northern Lakes College must present a business plan for

both internal and external scrutiny. Internally, it allows those who work in the institution to view

how well the institution is working toward the goals of its mission and where each employee has

participated in helping to reach those goals. Externally, the business plan allows the public to

have insight into accomplishments and future plans, and answers the question of what the

institution is doing with publicly allocated funding. This business plan covers five years,

reporting pertinent information relating to the current year’s accomplishments and challenges,

and the anticipated circumstances and plans for the next four. Its purpose is to inform the public

of the College’s strategic directions, along with the partnership and priority initiatives that are set

for each strategic direction. It contains key documents for the College, including the Mission

Statement, why we do what we do, and the Mandate Statement which describes how we go about

accomplishing what is set in the Mission Statement (Rick Neidig, Northern Lakes College


Business Plan 2007-2011, p. 2). The strategic directions are set by the College Board of

Governors, and the Business Plan provides a framework for setting priorities and resource

allocation. A number of issues were found to be at odds with parts of the document and its

content. Some managers expressed a concern that they felt disconnected from the document, that

their input was not always included or recognized. As the people “in the trenches,” they felt that

they had much of value to contribute to the future success of the institution. The College had

changed leadership over the last years and the new leadership felt that, although previous work

was truly meaningful, the Business Plan had become long and somewhat confusing. Over time,

parts had been added and some taken away. Some strategies were outdated and others were

stated more than once using different wording. The strategies stood with no measures or targets.

How would the College know when or if goals had been met, and if they had not, why? People

carried the answers in their heads, but nowhere was it written on paper for historical purposes.

College leadership began the search for a solution, a tool to help the organization get on

track. Interestingly, little traditional research was involved in choosing the Scorecard for trial

implementation. One of the College vice-presidents was already using a scaled-down variation

of the tool in her departments, and a new middle manager had participated in the for-profit

version at the corporation she had work for before joining the College. Finally, the institution’s

president and CEO, feeling the need for change, expressed his belief that the tool could be kept

simple enough to be useful without overwhelming the already stressed system. The Balanced

Scorecard was introduced to some members of the College management team at a workshop in

the early fall of 2007, and the College Board of Governors received their introduction to the

process late that fall. The system of organizing work was well received and leadership began

plans for implementation or, in the language of Scorecard subscribers, “cascading the

Scorecard.” A consultant was hired and a two-day workshop for 25 middle and senior managers

from across all College departments was organized. The first step in beginning the process was,

administration believed, to map strategies. Strategy mapping is the categorizing and the sorting

of an institution’s large overarching priorities, or strategies, used to meet the organization’s

mission and vision. The anticipated outcome was that the existing strategies would be sorted

into the relevant four or so perspectives as described above, and the cause and effect

relationships between the perspectives would be noted. The exercise resulted in little, if

anything, of use.


Reflection on the process uncovered a number of reasons why success had been road

blocked. The greatest difficulty likely arose from the sheer number of workshop participants.

As Niven (p. 50) explains, teams can range in number between three and thirty in order that all

areas are represented; ten or fewer participants show the greatest results (p. 50). In order to meet

the objective that everyone feels heard and his/her extensive knowledge is recognized, there were

25 participants. The perceived need for expediency meant too many people had been asked to

participate at one time. Disagreements arose everywhere, and more time was spent trying to

reach an understanding of the process and the reasons why the process should be adopted than

was spent moving forward. The consultant employed to facilitate the process seemed to have his

own agenda, and no amount of discussion would sway him from his self-defined path. Not

enough groundwork had taken place and the degree of understanding of the goal of the operation

was almost as diverse as the administrators who were in attendance. The College department

which was already using a form of Scorecard had their own understanding. Some departments

had not had any exposure to the process so although those participants believed a change was

necessary, they had not yet heard of the Balanced Scorecard and were still at the very early

stages of understanding. Others were somewhere in the middle. Process-focused participants

and goal-focused participants were at odds. As Niven warned, any group larger than ten presents

problems with consensus-building and other challenges (p. 50). This was definitely an excellent

example of the results of Niven’s caution not heeded. Working groups should remain small, at

least in the initial stages of consideration for implementation of the Balanced Scorecard.

The College president and one dean, who are particularly committed to the process--those

Kaplan and Norton would name as Scorecard champions--proposed that in order to avoid the

logistical difficulties involved in getting the larger group together, they would devote the time

necessary to sorting the existing strategies into perspectives, then they would return to the larger

group with a draft strategy map. Two days of constant attention were required to sort through

the documents, compressing some strategies and expanding others. On the day it was to be

presented to the larger group, a snow storm prevented all travel. It was felt that the meeting

needed to take place at that time as calendars were full, the holiday season was imminent, and no

one was certain when the meeting could be rescheduled for. The College culture of technology

usage allowed for a change of plans and a teleconference meeting was held. Some

administrators joined from their homes and others gathered at the closest campus with Internet


access. Much should be said about the commitment of the group who spent hours poring over e-

mailed documents in order to provide valuable input. The dean who was presenting the draft

strategy map to the group was well prepared, and it could be suggested that the teleconference

meeting had the effect of keeping people with sometimes distracting energy and ideas on track.

A decision was made by the champions to add two perspectives to those suggested in the

Balanced Scorecard. Respectful partnerships and external compliances were added to customers,

internal processes, sustainable finances, and learning and growth perspectives. Respectful

partnerships are foundational to the College’s values, and external compliances must be met. An

institution cannot disregard set standards, and all legal requirements--compliances--must be

taken into consideration. Although the institution has no control over whether or not to comply,

the cause and effect relationships are enormous and must always be considered. The institution

can and did decide to exceed standards. The decision to add the two new perspectives was well

received by the group.

The Northern Lakes College Vision Statement and Statement of Values are recorded with

the Mission Statement. As these statements, the Mission, the Vision and the Values, are all

prominently displayed throughout all of the dispersed campuses (28 at last count), on College

documents, including the backs of business cards, and reinforced at every possible opportunity,

one step suggested by the Scorecard promoters, communicating the mission, was skipped by the

champions.

Kaplan and Norton (1996) and Niven (2003, pp. 145-149) all suggest that the team

working on the Balanced Scorecard reach consensus on the terminology that will be used. The

Northern Lakes College experience demonstrated how imperative finding a shared language is

when excessive amounts of time were lost when miscommunication took over the participants’

focus during an implementation session. One example of this is in the much used for-profit

Scorecard term “value proposition.” A “value proposition” in the corporate world answers the

question “how do we create value for our customers?” Nair defines value proposition as “the

emotional, physical and symbolic residue derived by a customer when this individual or

organization purchases the product or service for a price” (2004, p. 23). Education is a product

provided by or through a college, and this would be a perfectly acceptable way to look at some

educational processes – “what should we offer to help students, our customers, find employment


and enjoy a better life? What add-ons to coursework would cause potential employers to see our

graduates as better trained than other institutions’ program graduates? How do we add value to

their educational experiences?” Unfortunately, many manager/educators understood “value

proposition” in a completely different context and believed the term to answer the question,

“how should we change our College values statement or how can we connect an idea just

proposed to our values statement?” Although this small confusion may sound a bit ridiculous

later, much time and effort was lost in a miscommunication that led some mangers completely

off track.

The Northern Lakes College Scorecard champions began to assemble a list of agreed-

upon terminology in order to head off future problems with this type of misunderstanding. Some

of the terms are included in the following:

Mission always begins the process, it is why we exist.

Values are how we expect everyone to behave.

Vision is what we would like to become.

Strategy represents broad, overarching priorities. Steps toward developing strategy

include: stakeholder analysis; SWOT (Strengths, Weakness, Opportunities and Threats)

analysis or Appreciative Inquiry; identification of strategic issues which may be long-

term or affect the entire College or have financial ramifications. Effective strategic

planning is accomplished through the development of objectives, measures and targets.

Initiatives are the actions put in place to achieve the targets.

Objectives or Outcomes are those things that must be done well to implement strategies.

Measures are how strategic success is measured; in quantity and/or quality.

Targets are short-term, medium-term and long-term organizational goals.

In writings concerning the Balanced Scorecard and its implementation, the term

“cascading,” as in “cascading the Scorecard” regularly appears. Caution needs to be taken in

using this language prior to front liners fully understanding what the intention is. Cascading is

jargon for implementing the Scorecard. It is the process of developing a Scorecard at every level

of an organization. Each Scorecard aligns with the Scorecard on the level above it and includes

what is required at that level in order to meet the organizational mission and vision, then tracks

the progress toward meeting the identified goals (Niven, 2006, p. 200). As a middle manager


responsible for the supervision of a number of highly intelligent professionals and academics--

political science, social science and English professors among others--I foresee the language

causing distraction if not handled quickly and firmly. With the Scorecard initiated at the top of

an organization then moving down, the word “cascading” is likely to take on an unintended but

often apt reference to how trouble runs. Some organizations take cascading to the individual

level. Niven suggests that when educating department members, cascading be promoted as

“giving all employees the opportunity to demonstrate how their day-to-day actions contribute to

the long-term goals” (p. 52).

By April of 2008, Northern Lakes College senior leadership had a draft strategy map

which was later accepted as final and would be included in the 2008 – 2011 Northern Lakes

College Business Plan. It includes the foundational documents and the two to four responses to

the questions asked as part of the Balanced Scorecard perspectives. Figure 2 is a copy of that

part of the draft.


Figure 2

Northern Lakes College Strategy Map Vision

Northern Lakes College will be recognized as a first-choice community-based college with the most accessible

programs and services in Alberta.

Mission

With respect for cultures and the needs of communities, Northern Lakes College provides educational programs and

services which enable adults to continue their education, to improve their employment opportunities, and to enhance

their quality of life.

Values Learning; Partnership; Respect; Success

Students and Communities (C) To achieve our vision, what are the key outcomes we must deliver for our students and communities?

C1-Responsive and equitable community-based delivery of and access to a continuum of educational programming.

C2-Quality1 programs and services, which support personal achievement, academic growth and employment

success, and which contribute to building community capacity.

C3-Supportive, positive and inclusive learning environment and workplace (in all locations).

Respectful

Partnerships (P)

External

Compliance (E)

Internal Processes

(I)

Sustainable

Finances (F) To deliver the required

student and community

outcomes, what do we need

to achieve with our key

partnerships?

To deliver the required


outcomes, to what

externally determined

regulations must we

comply?



outcomes, at which internal

processes must we excel?



outcomes & ensure

sustainability, what do we

need to do with our

resources?

P1- Maximize opportunity

through community,

secondary, post-secondary,

government, business and

industry, and employer

partnerships.

P2-Increase organizational

visibility.

P3-Communicate urban

and rural/northern

differences,

interdependencies and

synergies and potential

solutions and strategies.

E1-Comply with legal

requirements and

government directed

initiatives.

E2-Meet or exceed

standards set by

regulatory bodies and

partnership

organizations.

I1-Assessment of

stakeholder needs and

expectations.

I2-Continuous system

review and improvement.

I3-Communicating that

Northern Lakes College is

the learning provider,

employer, and partner of

choice.

I4-Acquiring, maintaining

and delivering quality

programs, services and

resources.

F1-Grow financial and

College resources

available for students,

programs, services and

facilities.

F2-Optimize resource

allocation and use.

F3-Renew and modernize

assets and infrastructure

to sustain College

operations.

People, Learning and Innovation (L) To achieve our vision, how will we sustain our ability to change and improve?

L1-Sustain a healthy and safe working environment.

L2-Develop, attract and retain qualified people.

L3-Share knowledge, information and resources internally and between related agencies. L4-Foster innovation and research relevant to northern Alberta and College interests.

1 In addition to equitable access, quality includes reliability, relevancy, timely delivery, credibility, cost-

effectiveness and overall excellence; culturally appropriate learning resources and activities.


The above document, the strategy map, enabled the Business Plan writers to present a much

clearer picture of what the College and its governors see as priorities and how College

employees, both faculty and staff, work to achieve those priorities. An example of the process as

it affects the Health Careers department is as follows (Figure 3).

As students and communities are the College customers, the question to be asked is “what are the

key outcomes we must deliver for our students and communities to achieve our vision?” A

number of outcomes answer the question, in this case C1, C2 and C3.

Figure 3

Students and Communities (C) To achieve our vision, what are the key outcomes we must deliver for our students and communities?

C1-Responsive and equitable community-based delivery of and access to a continuum of educational programming.

C2-Quality1 programs and services, which support personal achievement, academic growth and employment

success, and which contribute to building community.

C3-Supportive, positive and inclusive learning environment and workplace (in all locations).

Once each strategy is mapped, a priority initiative is set. To continue with the example

above, the priority initiative is: “As a comprehensive post-secondary institution, the College will

open the door to programming from the entire post-secondary system and the transition for

learners through the system” (NLC Business Plan 2008-2011, p.10). This statement is followed

by another statement describing how this priority initiative will be reached: “The College will

contribute to solutions for healthcare skills shortages in northern regions with the following

concrete strategies…” The strategies presented in this example relate to achieving outcomes C1

and C2 above; one of these is: “In partnership with health authorities and other post-secondary

providers, research and plan for needed programming; develop and/or acquire more healthcare

certificate and diploma programs to meet employment demand and strengthen the rotation of

health programs through the region. I4” (p. 10). I4 is the designation for the fourth strategy of

the internal process perspective. The internal processes perspective will affect or be affected by

what happens in the movement to achieve the strategy which has been described above. In

short, the chain works like this: to achieve our vision, what are the key outcomes we must deliver

for our students and communities? As a comprehensive post-secondary institution … → we will

contribute to healthcare skills shortages … → by providing responsive and equitable community-

based delivery and quality programs and services healthcare programs to meet employment

demands … . Each chain is worked through with all possible cause/effect relationships noted.

With these steps completed, Northern Lakes College has documented two of the four steps in the


Scorecard matrix: the objectives and the initiatives have been determined, the targets and

measures remain.

A decision has been made by College leadership to adopt only those parts of the

Scorecard that suit the College needs, for example to encourage each person, faculty and

department to set targets and measures as goals for themselves but to see these targets and

measures points to strive for and a talking points. The questions to be asked “what were you

targets, how would they be measured? Is the target one that would support the College

initiatives? Why was or was not the target met? What can we do to help meet this target? Is the

target one that is still relevant to the current environment?” One of the Scorecard’s purposes at

Northern Lakes College is to help adopters to keep focussed on the Mission and document which

strategies worked and which did not.

Even though buy-in is required at the front line of an organization, Niven (2006)

proposes that the Balanced Scorecard approach to strategic planning can be successful only if the

concept is owned by an organization’s leaders and senior management. Senior managers are the

ones with the background knowledge, the ability and the right to make higher level decisions.

Many workers are comfortable with the status quo; they find changes in the way they go about

their jobs to be avoided at all cost. It is difficult if not impossible to have front-line personnel

embrace a concept, or the processes that are attached to it, if management does not take the lead

in making changes. An organization’s leaders must build a Balanced Scorecard tool for their

own use and make the changes they find necessary before asking others to follow suit (50).

“Whether organizations are top-down driven or middle-managed, the CEO and executive team

make sustained transformation happen” according to Nair (2004, p. 90).

A wise person once said, “the only constant is change.” This is abundantly evident at

Northern Lakes College where faculty and staff are only half-joking when they suggest that if

they could only do something twice without complete and total change, it would most certainly

be a great event. From the amalgamation of the Community Vocational College and the Alberta

Vocational College to become Alberta Vocational Centre – Lesser Slave Lake and from that

government supported institution to a board-governed College – Northern Lakes College, change

has been the only constant. Changes in systems, changes in requirements for funders, changes in

communication and data technology, changes in priority projects and changes in reporting for

accountability practices are almost daily occurrences. The fallout from all the changes can be


felt in a number of somewhat unrelated places. For example, common knowledge is that in

business, government and non-profit organizations such as educational institutions, people are

asked to do more with less. Doing more with less can mean, in plain and simple terms, spending

more hours at work than ever before. It can also mean change, and change in itself can be

exhausting. Unless frontline personnel are convinced that change to a new system such as the

Balanced Scorecard translates into less work, or at the very least more controlled work for

themselves, the Scorecard stands little chance of successful application. This is one of the

challenges management can expect if all parties involved do not buy-in.

Keating, et.al. (1999) use management systems examples such as Total Quality

Management and Reengineering to show how successful attempts at improvement to some

aspects of an organization’s production can adversely affect other aspects. Employees may have

cause to worry about their jobs if improved production means a quicker, more efficient turn

around (p. 10). At Northern Lakes College this has potential to be a problematic in those

departments involved in internal processes where copious amounts of data is inputted and

manipulated, make that process cleaner – simpler and people loose jobs. The reader is also

reminded that excitement fades, so other sources of motivation must be found. Improvement

takes time and commitment from employees, release time may be necessary (p. 24) how will this

affect the College goal of sustainable finances?

Another potential side effect in the process of adopting a strategic management system is

that any project or program initiative that does not tie directly to the organization’s mission or

vision is likely to be discarded. For an organization, such as Northern Lakes College, where

many of the faculty and staff are driven by a focus on community development and who

maintain a need to be all things to everyone, and where personnel have over time been given a

great deal of autonomy, discarding inappropriate initiatives can be particularly difficult. The

initiatives are attached to the people and discarding any of the initiatives, some of which are

most laudable, is apt to cause a degree of discomfort for managers and front-line personnel alike.

Again, the employees must be convinced of the benefits of change.


Implementation Plan – Cascading the Balanced Scorecard – University and Professional Studies

In order that the Balanced Scorecard be at its most useful in an organization it must be

understood at all levels of the organization and implemented at all levels of the organization.

Northern Lakes College has taken the first tentative but significant steps. Support originated in

the highest leadership offices, and those offices have proven their commitment to the process by

developing the foundational documents. These documents included the strategy map along with

draft targets and measures for the highest levels of college management. As a middle manager, it

is my job to develop a Scorecard for my department and assist in the development of a Scorecard

for each employee, both faculty and staff, for whom I am responsible. I have developed a plan to

put the process into operation. (See figure 4.) On completing the research for this project, I

anticipate taking the words of the Scorecard founders to heart. This will not be a quick and easy

cascading process. Along with the work around introduction and getting buy-in, timelines for

the building of each Scorecard will depend on many factors including other work commitments

such as teaching loads for faculty.


Figure 4

Timeline Activity Topic

Mid September

2008

-Face-to-face meeting with Program

Coordinators to introduce the Balanced

Scorecard and discuss how it will affect

each of them and their work

-Discuss history of Scorecard,

its strengths and weaknesses

-Work completed to this point

-Begin brainstorming – what

ours should contain

Mid October

2008

-Provide first process overview and

communicate potential benefits to

employees using the department e-mail

distribution list

-Meet with both departments and

Coordinators using College supported

learning / meeting technology (likely Centra

as the technology allows for both audio and

graphics and is available at all sites)

-Field questions about the

actual process

-Address concerns that this is

a management process “of the

month”

-Address work/return

questions

-Ask participants to consider

joining the implementation/

facilitation team

November 2008 -Meeting to confirm “Scorecard Team” for

each department (4-5 members will likely

allow for a team with sufficient numbers to

provide different viewpoints for each of the

departments while still able to move

forward with consensus)

-Teams will be asked to put

together Scorecard drafts for

the larger group of their

department.

-Ask for feedback

Late January

2009

-Confirm measures and targets for

department Scorecards and determine

reporting procedures

March 2009 -Meet with larger group to discuss

individual Scorecards.

-Require individual

Scorecards to be ready for

2009 Performance Evaluation

meetings and to be used in the

2009/2010 Performance

Evaluation cycle.

Note: individual Scorecards

will help employees work with

their supervisors in selection

of professional development

activities for the upcoming

cycle.

During the 2006/07 academic year, Northern Lakes College commissioned an Employee

Satisfaction Survey. Although the results summary indicated an all-round state of employee


satisfaction, some issues did come to the fore. One issue noted was that some employees believe

there is a breakdown in the communication process. (Weststar Inc., January 2008, p. 22). For

various reasons, faculty felt they did not know what was happening or why and were not certain

that their concerns and ideas were being acted on or even heard by management. It is my belief

that by using the Balanced Scorecard as a communication tool, answering questions about what

we are doing, why we are doing it and whether we are successful, along with the reasons behind

the success or lack thereof, the results should are a step toward more open communication flow.

Kellerman, in her work on changes in leadership, draws a comparison and differentiates

between leadership and management. In her words:

Leadership is the effort of leaders … to engage followers in the joint pursuit of mutually

agreed-on goals. These goals represent significant, rather than incremental, change.

Management is the effort of managers … to get the trains to run on time. … [M]anagement

does not in and of itself involve significant change. (p.10)

Morgan (1997), in the bibliographic notes of “Images of Organizations,” provides an overview

of some of what has been written on the role of leadership in corporate change or transformation

(p. 400). The fact that the Balanced Scorecard process was initiated and supported at the highest

level of Northern Lakes College’s organizational leadership bodes well for its chances of

successful implementation and usefulness in the College planning and reporting processes as a

strategic management system.

Conclusions

Although a substantial amount of work has already been accomplished, Northern Lakes

College is at the very beginning of the road to adopting the strategic management system, the

Balance Scorecard. What is the Balanced Scorecard? The Balanced Scorecard is a strategic

management system, resulting from the research done by Kaplan and Norton in the early 1990s.

Until that time an organization’s success was measured only by its financial means. Financial

indictors tell a story after the fact and give little indication of future success. As manufacturing,

the production of merchandise for the purpose of sale, was exchanged for knowledge production,

resources became more difficult to count. The authors determined that an organization must be

seen from a number of perspectives including the customer perspective, the internal business

process perspective, the sustainable finances perspective, and the learning and growth

perspective in order for a holistic picture of organizational activity to be developed. The


organization’s mission, vision and strategy are always at the focus of the perspectives. The first

Scorecards were developed for profit-minded corporations, but the process was adapted for use

by non-profit groups, including educational institutions and governments. Essentially, the

Scorecard is a process that includes the aligning, monitoring, measuring and tweaking of those

things required for an organization to be successful and to understand why it is. The Scorecard

must be supported at the highest levels of organizational leadership and cascaded down to the

personal level. Although lauded by many as the answer to most of both corporate and non-profit

organizations’ management issues, critics warn that not enough research has taken place over a

long enough period of time, and that such things as changes in environmental conditions and

other uncontrollable forces can have unforeseen effects with no contingency plan.

Why would this tool for strategic management be chosen? Northern Lakes College was

ready for a change. College leadership was actively seeking ways to manage the ever-changing

working environment, provincial ministry priorities, reporting practices, and the need to

communicate all of this to those with a desire to know; a new way to inform the College’s annual

business plan. A few members of the College management team had been introduced to the

Balanced Scorecard through outside experiences. As the management tool was believed to be

one of the simplest to understand, implement and continue to use over a period of time, the

management team began organizing introductions to the Scorecard for College employees.

Some of the first efforts lead to less than spectacular results. Although consultants were hired, ,

the large number of workshop participants created problems with different understandings of

purpose and language. A second attempt made by College leadership to make the Scorecard into

a usable tool for management and reporting purposes met with substantially more success and

the initial results were made ready for the 2008/2011 Business Plan.

How will the Scorecard be implemented? At this point, the greatest learning, beside the

history and basics of the Balanced Scorecard, has been in acknowledging the need for time to

implement, cascade, the tool. Although some activities, such as the alignment of the

organization’s overarching initiatives and strategies, took place in a relatively short time, this is

only a small part of the project. Time must be found to meet with all employees involved, help

them understand the reasons for implementing the tool, and get their buy-in. Department faculty

and staff are often cynical of change as it will initially mean more work for them. They must

feel that the results of the changes will mean a more focused work plan with fewer ad hoc moves


for them. My plan is to move toward introducing the Scorecard to program coordinators who are

those most closely involved with the front-line faculty. Implementing such an all-inclusive

process is only the first challenge; if it is to be essential and useful to the College environment as

a whole, it is imperative that the answers to the questions asked in the perspectives be revisited,

updated and answered regularly. The Balanced Scorecard must be part of organizational culture

if it is to meet its full potential.


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the balanced scorecard: critical reflections on the …

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