Most executive teams are reasonably good at formulating their organization’s strategy, or they hire consultants to help them. A major frustration with executives the failure to successfully implement and execute their strategy.
The strategy map and its associated Balanced Scorecard, a methodology developed by Drs. Robert S. Kaplan and David Norton, recognized this problem. They observed the problem of executive managements’ excessive emphasis on after-the-fact, short-term financial results. Their strategy map resolves this myopia and improves organizational performance by shifting attention from financial measures (referred to as key performance indicators, KPIs) to managing non-financial operational measures related to customers, internal processes, and employee innovation, learning and growth. These influencing measures are reported during the period when sooner reactions can occur. This in turn leads to better financial results.
The enterprise performance management (EPM) seamlessly integrates it many EPM methods including strategy maps and a balanced scorecard. Together these two tools align manager and employee behavior, actions, and priorities with the executives’ strategy using key performance indicators (KPIs) with specific KPI targets to enable accountability.
This presentation by Gary Cokins will cover:
• How strategy maps and their companion balanced scorecards communicate strategic objectives with target-setting to help cross-functional employee teams align their behavior to the strategy and better collaborate.
• How to design a strategy map and identify the strategy’s required projects or core process improvements which lead to selecting KPIs.
• How to differentiate strategic KPIs from operational performance indicators which cascade downward from the strategic KPIs.
• How to deploy a “quick start” implementation in two days to iteratively expand to a balanced scorecard production system in a few weeks.
Publication Date: December 2021
Topics Covered
- What is Corporate Performance Management (CPM)?
- Eight Pressures that have caused interest in CPM
- Strategy map and its Balanced Scorecard
- Differentiating KPIs from PIs
- CPM as a Value Multiplier through Integration
- Barriers Slowing the Adoption Rate of CPM
Learning Objectives
- Recognize the origins of the balance scorecard
- Identify how to design a strategy map
- Identify how to define appropriate key performance indicators (KPIs)
- Recognize how to apply targets of KPIs for motivation and incentives
- Recognize which organizations Corporate Performance Management (CPM) methods can be applied to
- Identify where the vision and mission statement of an organization comes from
- Describe the purpose of the balanced scorecard
- Identify what managers should be responsible for in reference to the balance scorecard
- Recognize which of the four perspectives included in the Kaplan-Norton strategy map contributes to internal process
- Recognize which strategic planning tool analyzes the business environment
Level
Basic
Instructional Method
Self-Study
NASBA Field of Study
Business Management & Organization (2 hours)
Program Prerequisites
None
Advance Preparation
None
Instructor
Gary Cokins
Gary Cokins is an internationally recognized expert, speaker, and author in advanced cost management and performance improvement systems. He is the founder of Analytics-Based Performance Management, an advisory firm located in Cary, North Carolina. Gary received a BS degree with honors in Industrial Engineering/Operations Research from Cornell University in 1971. He received his MBA from Northwestern University’s Kellogg School of Management in 1974.
Gary began his career as a strategic planner with FMC’s Link-Belt Division and then served as Financial Controller and Operations Manager. In 1981 Gary began his management consulting career first with Deloitte consulting, and then in 1988 with KPMG consulting. 1992 Gary headed the National Cost Management Consulting Services for Electronic Data Systems (EDS) now part of HP. From 1997 until 2012 Gary was in business development with SAS, a leading provider of enterprise performance management and business analytics and intelligence software.