Performance Management & Strategy Execution Blog: The Glue

What’s Cool About Scorecards?

Today I was reminded what the coolest thing is about Balanced Scorecards: THE CONVERSATION

 

The point of a scorecard is to force "the conversation" about the most important “red” measures (those not hitting targets). Sure there are other benefits of scorecards, like communication of strategy and transparency, but for me I’m most excited to see my client have an honest conversation about what they can do to turn “reds” to “greens.” The real reason to develop a scorecard, after all, is that it's not just a report. Reports don’t relieve stress in the organization. The conversation that occurs during a Scorecard Business Review does.

As many of you can appreciate, there are no guarantees that you’ll get to the conversation.

But after the strategic planning, the scorecard cascading, the cultural resistance to “more work,” the gathering of the data, the setting of targets…today we made it!

 

I felt truly happy to listen to a cross-functional conversation about a “red” measure in the purchasing area. At the beginning you could feel the tension in the room.  This measure symbolized the stress behind the process.  But the conversation forced the participants to truly understand the current process and to brainstorm how they could improve it.  Once that happened, the scorecard participants could see the light at the end of the tunnel.  This will be a "green" measure soon.  Their lives will be so much less hectic next year. They finally saw the value that the CEO promised would be there.

 

That's cool.

Webinar this Thursday -- "Government 2.0: Increase Transparency and Accountability with StimulusScorecard"

Join us this Thursday, June 25th at 2pm EDT for a free webinar on Government 2.0 and StimulusScorecard.

‘Government 2.0' involves using web tools to increase transparency and thus improve the effectiveness and openness of government. In this webinar, we’ll discuss a tool called ActiveStrategy StimulusScorecard, which enables governments to leverage the web to aid in strategic planning, performance management, and Stimulus reporting.

The first round of ARRA (Stimulus) reports are due October 10th, and require that a “full picture” of the projects be presented so that taxpayers have the ability to track and monitor how the funds are being spent. During the webinar, we’ll review the latest reporting requirements released by OMB and discuss why waiting to set up your reporting system until the full extent of requirements are published in August might create problems. StimulusScorecard is a Balanced Scorecard-based, centralized collection system for your Stimulus project data that you can use now to ensure that your programs stay on schedule and on budget and to track accountability for every stage of the work. And you can use the data you’ve collected to populate OMB’s reports when the time comes.

During a live demo of the application, we’ll show you example Stimulus project scorecards, as well as how to share your data with the public.

Presentation topics:
• Review of the latest Stimulus reporting requirements
• How a scorecard application makes data available for preemptive action on emerging problems
• How technology can keep critical data part of on-going operational decision making
• How StimulusScorecard can facilitate clear communication with the public on who is benefiting from projects and who is responsible for keeping project commitments
• Review of example Stimulus Project Scorecards

To register: https://www1.gotomeeting.com/register/978908841

Four Things You Should Know About Your Scorecard Measures

Measures trigger work. You're either creating measures, gathering data for them, reviewing them, or trying to improve them. That work will often be resisted due to confusion and credibility concerns. I coach my clients to know 4 things about every measure they have:

1. Where does the data come from? This is the most common challenge leaders throw at measures. "I don't trust the source, so I don't need to act." You need to know what department pulls the data, if they transform it in some way, who quality checks the data, and who loads it into your scorecard. 

2. What is excluded from the data? Too often, leaders look at measures for months without really understanding what the numbers mean. Specifically, they don't really know what's included and excluded from the numbers. It's important to know those nuances before you spend time and money on improving the numbers.

3. Why did we set the target? Typically, those who are responsible for acting on measures weren't in the meeting when the target was set. Many times, there's even confusion within the team that set the target. I ask my clients to find out who set the target and what the rationale was for setting it.

4. What accumulation do we care about? Knowing the answer to this subtle question will help you clear up a lot of confusion. Each time the scorecard team meets to discuss the measure, is it more important to talk about performance YTD, performance just this period, or the performance as a snapshot in time?

Let me know if you consider other questions that I didn't mention.

Two Quick Tips to Keep Your Scorecards Alive

Tip #1: Put all scorecard reviews for the year on the calendar now.

I’ve said it many times in the past, but it’s worth repeating. It’s not what gets measured that gets done. It’s what gets reviewed that gets done. Events drive behavior. If measure owners and your data entry people don’t see a date set in stone when managers will meet and review the scorecard, they won’t update the data action items. There are so many other demands on their time that if they can let this one slip, they will.

Tip #2: Always repeat the same agenda.

There are a few agenda topics that are critical to keeping the strategy alive, even late in the year. Too often, these agenda points drop off after the first month because scorecard teams are busy fighting fires and reacting to their daily work. I recommend that every scorecard review contain the exact same topics throughout the year. If some topics need more time, fine, but the scorecard review must touch on all the topics.

Here are some of those topics I see commonly discarded later in the year:

• State the strategy.

• Has the strategy changed?

• How do we measure the strategy?

• Are the targets still valid?

• Who is responsible for meeting the targets?

• What are the most important measures now?

Go forth and review!

Musings on Measurement and the Quality of Working Life

Last week, I had the pleasure of addressing an assembly of Florida local government performance management professionals. Yes, I was preaching to the choir, but they carry the message of the benefits of measurement back to their governments. I encouraged them to use sports analogies to explain the message. Pro teams track their win/loss records (and revenues) on their top level "scorecards," and the offense has a "linked" scorecard, as does the defense. Each player has "Personal Goals," such as completed passes, yards gained, etc. Players do not feel imposed on by measurement but understand that it is an essential tool for individual improvement and sustained high performance by the team. Moving to another sport, Michael Phelps does not get upset when his coach uses a stopwatch to measure his performance and he is used to knowing times for individual laps so he can assess his performance in segments from the time he leaves the blocks to the millisecond he touches the wall to finish.

This approach to discussing performance measurement often resonates for the athletes, former athletes and us fans. However, there still is a lingering fear of measurement. The fear is not irrational; the misuse of measurable goals goes back a long way in American business culture. Dr. Deming himself would rail on about arbitrary targets that were unreachable because of the limits of process capabilities. Regardless, they are used to "push" people, but in fact demoralize them. People rally around a reachable "stretch" goal, but lay down and push paper when the impossible is asked. If you ask me to do a six minute mile, I laugh or cry; I don't try. Ask me to walk a mile a day for my health, and we have a real conversation and I am motivated.

Which brings me to something new I have learned about measurement. It literally can be good for our mental and physical health. I recently heard a commencement speech by the Dean of the Education Department at the University of Miami. He stated that there is considerable research suggesting that people who have control over their work lives (are empowered) live longer and use the health system less. Empowered employees are employees with measurable personal and project goals and have great discretion in the approach to achieving goals and meeting specifications. Effective empowerment cannot be accomplished without performance measurement. This observation should help performance management professionals appreciate the importance of their work, not only for organizational excellence but also personal well being.

Dean Prilleltensky had another message for the graduates. Important human advances are made by changing systems/processes. We need to help individual managers use measurement to develop their organization and employees. More importantly, we need to affect how measurement and managment are taught and modeled by leadership.Maybe electing former pro athletes to Congress is not such a bad idea after all.