10 questions about Balanced Scorecard to Forrest W. Breyfogle III
10 questions to Balanced Scorecard Expert Forrest W. Breyfogle III, Smarter Solutions, Inc.
1. Please, summarize in few words what is your expertise and background with Balanced Scorecard.
I have worked with many companies that have used the Balanced Scorecard.
2. It is known that Balanced Scorecard is used by more than 50% of Fortune companies. Do you think this concept is for big companies only?
All companies large and small need to have scorecards that lead to the 3 Rs of business; i.e., everyone doing the Right things, and doing them Right, at the Right time.
A Wall Street Journal article “Strategic Plans Lose Favor: Slump Showed Bosses Value of Flexibility, Quick Decisions” is available through the link. This article illustrates what I think is a flaw with traditional applications of the balanced scorecard. With traditional implementations metrics are to be aligned with strategies, which according to the article, now need to be more dynamic than in the past to address changing environmental conditions. This dynamic environment would cause havoc with traditional implementations of the balanced scorecard.
3. While BSC concept is popular now, what other business performance measurement concepts can you recommend for companies to consider?
The following article describes an enhanced business performance management system that helps organizations toward achievement of the 3 Rs of business: “C-Suite: The Need to Re-think our Business System’s Strategic Planning, Scorecard Creation, and Process Improvement Efforts”
4. Please, share your opinion about key ideas that should be kept in mind for successful implementation of BSC?
Think that it is important to have a natural balance rather than a forced balance; e.g., don’t want to sacrifice quality for improved on-time delivery. Organizations benefit from a system where scorecards are long-lasting and have a predictive format, as described in the article “Creation of Effective Organizational Predictive Metrics that Lead to the 3 Rs of Business”
5. The BSC is a business performance measurement concept, but should only top managers and CEO use it? Or should it be used company-wide? Should BSC be implemented in all departments or for instance only in HR?
Scorecards should be created throughout the organization where they make physical sense, recognizing that it is important not to force a scorecard metric where not appropriate.
6. While there are certain benefits of BSC, do you see there any limitations or possible problems? Some areas where BSC does not work properly or is inefficient.
Shortcomings are described in: “The Balanced Scorecard: Issues and Resolution”
7. The BSC concept is discussed widely. What do you think, if most companies understand the importance of BSC development? Are they willing to invest in BSC? Is it hard to get decisions makers to conclusion that it is necessary to use BSC?
It is important for executive management to have effective performance metrics. An enhanced balanced scorecard system that structurally integrates with process improvement efforts so that the business as a whole benefits is described in “Corporate Performance Management: The Integrated Enterprise Excellence System“
8. The practical implementation is always as important as theory itself. There are a lot of ways to implement BSC from simple Excel files to software, web-based services and full integration with company business system. What do you think is the best implementation strategy in terms of quality/price? What type of tools would you use to do implementation?
Need to have a system for real-time predictive metric reporting that get organizations out of the firefighting mode and improvement metric needs pull for the creation of improvement projects that benefit the business as a whole; e.g., avoiding silo projects that might reporting a savings of 100 million dollars but nobody can find the money.
9. There are companies that already use BSC, we read about them in business magazines, we read their case-studies and success stories. What advice would you give companies that just start considering the implementation of Balanced Scorecard concept?
Performance scorecards need to be part of a business system that addresses the problems of the day as described in “The Elephant in the Room: Corporate Performance Management Issues and its Reinvention, Going Beyond Lean Six Sigma and the Balanced Scorecard”
10. Thank you very much for your answers. I think our readers would like to know more about your company and service you provide. If possible share also your detailed experience with Balanced Scorecard here.
Smarter Solutions, Inc. helps organizations create a balanced, predictive scorecard system that integrates with analytically/innovatively determined strategies that creates/executes improvement projects so that the business as a whole benefits.
