Balanced Scorecards and Six Sigma / Business Process Unite: How Marriage of Strategy, Process and Metrics Can Differentitate Your Company During Times of Financial Crisis or Cutbacks…Here’s how:

Balanced Scorecards (BSC) with drill-thru, linked dashboards are a perfect companion to a Six Sigma or business process focused organization, helping to facilitate the project selection process — most deployment leaders assign projects according to those with the highest benefits (ROI); extrapolated further, this stack ranked approach could be further stratified by critical to success measures, linked to the corporate strategy…
 
What do I mean…
 
Take an objective like ‘Increase Growth in our International markets’ — you assign a metric of Growth % to the objective which becomes your KPI. You assign a weight of importance to that KPI of a 5 (1 – 5 scale), meaning the most important performance indicators to the business. Underneath, you affinitize 5 metrics that roll under ‘Growth %’ KPI, which become your related PIs, or performance indicators. An example would be Sales Growth by Region (whether you have domestic and international regional attribute slices).
 
You determine 2 projects to help you with this one PI that will contribute 80% to the overall Growth KPI.
 
(Gotta love the pareto rule: 80% of all impact is caused by only 20% of the variables).
 
What should you display on your scorecard vs. linked dashboard(s)?
 
The KPI should end up on the executive view of the BSC to keep it at the 60000 ft view; if one wants to peel back the onion, they will inquire further by naturally clicking on something as this is a natural analytical thought process when looking at data on a computer screen.
 
Next, you should associate the What Are you Doing About it – Otherwise, it isnt truly balanaced nor will it be useful to others in the org, like a PMO department. This is where the Six Sigma overlap is again evident-
 
Projects should be divided into 3 categories:

i. ‘Quick wins’ (less than 3 months from concept to results; solution is not known upfront)
ii. ‘Just Do It ‘(less than 6 months from concept to post implementation/results tracking; solution is already known at onset)
iii. Lean Kaizen events / Workout projects (3-6 months in project duration; non-political; where the end is achievable & only light statistics are necessary to deliver quick but meaningful hits; often suited for more nimble organizations though efficient, process focused large companies can also benefit from this concept.
Stratify this further into 5 views , one of which is a concept I like to call ‘voice of inner perspective’ –
 
By recognizing upfront that it is no easy process, and definitely easier said than done, you should be able to set expectations for yourself and others…And, to change the paradigm one person at a time, readers, please understand…, THIS WILL NOT BE EASY — You need passionate people and passion yourself to weather the hard times, neigh-sayors and roadblocks.
 
I, too, thought.."yeah, and pigs will fly when top leadership lets any scorecard drive strategic planning…" But then, I saw it work in a most uncertain of times; in a most unrealistic of deployments: bottom’s up, grass roots & employee driven. Proof was in the pudding, and once we got traction and JUST DID IT, rather than JUST TALKING ABOUT IT, leadership got excited and bought into the program. Then, we went to the TOP (CEO), gained support, and got the mandate and funding we wanted in the beginning.

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2 thoughts on “Balanced Scorecards and Six Sigma / Business Process Unite: How Marriage of Strategy, Process and Metrics Can Differentitate Your Company During Times of Financial Crisis or Cutbacks…Here’s how:

  1. First of all I would like to say wonderful blog! I had a quick question that
    I’d like to ask if you don’t mind. I was curious to know how you center yourself and clear
    your mind prior to writing. I have had a tough time clearing my thoughts in getting my thoughts out.
    I truly do take pleasure in writing however it just seems like the first 10 to 15 minutes tend to be wasted simply just trying to figure out how to
    begin. Any ideas or tips? Many thanks!

    • Hi there,

      Sorry for my delay. Writing is one of those curious activities which requires a “tabula rosa” in order to effectively get across ones’ ideas. This is so much easier said that done. You will notice my absence in 2012. This was because I was struggling to clearly understand my changing passions.
      That is the one key I would say about writing – you have to be passionate about what you are putting forth. If you are not, your readers will sense that and become disenchanted. Also, do not force it. I took a leave of absence to truly ponder my point of view. And understand that you will have moments of genius with your writing and moments of true “writer’s block.” But everything works out in the end if you are passionate and care enough to share your experiences with others :).

      Good luck and thank you for your comment,

      Laura

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