Balanced Scorecard for Corporate Strategy

Corporate Strategy Corporate Strategy and Alignment and Alignment The Balanced Scorecard The Balanced Scorecard

ApproachApproach

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Power of Balanced Power of Balanced ScorecardScorecard

The Balanced Scorecard serves as a The Balanced Scorecard serves as a powerful, systematic, and developed powerful, systematic, and developed approach to Corporate Governance approach to Corporate Governance

and Corporate Alignmentand Corporate Alignment

Power of Balanced Power of Balanced ScorecardScorecard

All key corporate management All key corporate management processes are directly affected by processes are directly affected by

the Balanced Scorecard the Balanced Scorecard implementation implementation

Key corporate management Key corporate management processes affected by BSCprocesses affected by BSC

1.1. MobilizationMobilization

2.2. Strategy TranslationStrategy Translation

3.3. Corporate Alignment Corporate Alignment

4.4. Employee MotivationEmployee Motivation

5.5. Corporate Governance Corporate Governance

How the Balanced Scorecard How the Balanced Scorecard affects key corporate affects key corporate

management processesmanagement processes

1. 1. Mobilization:Mobilization:

Orchestrating change through Orchestrating change through executive leadershipexecutive leadership



2. 2. Strategy Translation:Strategy Translation:

Defining Strategy Maps, Strategic Defining Strategy Maps, Strategic Themes, Balanced Scorecards, Themes, Balanced Scorecards, strategic objectives, targets, and strategic objectives, targets, and initiativesinitiatives



3. 3. Corporate Alignment:Corporate Alignment:

Aligning corporate, business units, Aligning corporate, business units, support units, external partners, and support units, external partners, and boards with the strategyboards with the strategy



4. 4. Employee Motivation:Employee Motivation:

Providing education, communication, Providing education, communication, goal settings, incentive goal settings, incentive compensation, and training of staffcompensation, and training of staff



5. 5. Corporate Governance:Corporate Governance:

Integrating strategy into planning, Integrating strategy into planning, budgeting, reporting, and budgeting, reporting, and management reviewsmanagement reviews

Corporate Alignment – Corporate Alignment – the Greatest Challengethe Greatest Challenge

Corporate Alignment is the area Corporate Alignment is the area where the Balanced Scorecard where the Balanced Scorecard especially especially outperforms other outperforms other management practicesmanagement practices


Balanced Scorecard creates the Balanced Scorecard creates the framework to framework to respond to the respond to the critical question - how corporate critical question - how corporate headquarters creates more headquarters creates more value from the businesses it owns value from the businesses it owns and operates than its rivals would if and operates than its rivals would if they owned the same set of they owned the same set of businesses, or if the businesses businesses, or if the businesses operated completely independently. operated completely independently.


The four Balanced Scorecard The four Balanced Scorecard perspectives provide a natural way perspectives provide a natural way to categorize the various types of to categorize the various types of enterprise value propositions that enterprise value propositions that can contribute to corporate synergies can contribute to corporate synergies

Managing Corporate Synergies -Managing Corporate Synergies -the Balanced Scorecard viewthe Balanced Scorecard view

Financial SynergiesFinancial Synergies

Effectively acquiring and integrating other Effectively acquiring and integrating other companies companies

Maintaining excellent monitoring and governance Maintaining excellent monitoring and governance processes across diverse enterprises processes across diverse enterprises

LLeveraging a common brand across multiple everaging a common brand across multiple business units business units

Achieving scale of specialized skills in negotiations Achieving scale of specialized skills in negotiations with external entities such as governments, unions, with external entities such as governments, unions, capital providers, and supplierscapital providers, and suppliers


Customer SynergiesCustomer Synergies

Consistently delivering a common value Consistently delivering a common value proposition across a geographically dispersed proposition across a geographically dispersed network of retail or wholesale outlets network of retail or wholesale outlets

Leveraging common customers by combining Leveraging common customers by combining products or services from multiple business products or services from multiple business units to provide distinct advantages: low units to provide distinct advantages: low cost, convenience, or customizes solutionscost, convenience, or customizes solutions

Managing Corporate Synergies –Managing Corporate Synergies –the Balanced Scorecard viewthe Balanced Scorecard view

Internal Business Process SynergiesInternal Business Process Synergies

Exploiting core competences that leverage Exploiting core competences that leverage excellence in product or process excellence in product or process technologies across multiple business technologies across multiple business unitsunits

Achieving economies of scale through Achieving economies of scale through shared manufacturing, research, shared manufacturing, research, distribution, or marketing resourcesdistribution, or marketing resources


Learning and Growth SynergiesLearning and Growth Synergies

Enhancing human capital through excellent HR Enhancing human capital through excellent HR recruiting, training, and leadership development recruiting, training, and leadership development practices across multiple business units practices across multiple business units

Leveraging a common technology to access a Leveraging a common technology to access a wide set of company services, that is shared wide set of company services, that is shared across multiple product and service divisions across multiple product and service divisions

Sharing best-practice capabilities through Sharing best-practice capabilities through knowledge management that transfers process knowledge management that transfers process quality excellence across multiple business units.quality excellence across multiple business units.

Other sources of BSC powerOther sources of BSC power

Other Balanced Scorecard applications Other Balanced Scorecard applications such as strategy mapping, sharpening such as strategy mapping, sharpening strategic themes, or strategy reverse strategic themes, or strategy reverse engineering might also have a powerful engineering might also have a powerful effect on corporate governance and on effect on corporate governance and on how corporate strategy is executed.how corporate strategy is executed.

Find out more information on:Find out more information on:– Strategy MapsStrategy Maps– Sharpening Strategic ThemesSharpening Strategic Themes– Strategy Reverse EngineeringStrategy Reverse Engineering

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