We create a Balanced Scorecard system with our own hands. Part Three - Final

So, we have dealt with the theory of building Systems of Balanced Indicators, we decided on how to write a company development strategy (which actually lies at the heart of the MTP).
And now is the time to begin the process of creating the BSC and determining the KPI.

Cooking Template
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For now, set aside the PC keyboard and close the covers of the laptops. Pick up a good old sheet of paper and draw 4 rectangles on it, one above the other.
It will be prospects . You will place your KPIs in them.

Now is the time to give the prospects a name. At the bottom of the box write " TRAINING AND DEVELOPMENT " (for brevity, I will call this perspective O & R in the future). There will be indicators and tasks responsible for the state of your team.

Each member of the team must be properly motivated to perform work tasks and have sufficient qualifications. Otherwise, you will find yourself a general without an army - the employees will receive regular wages, they will not be able or they will not want to implement the strategy of your company.

On the next rectangle, we write " INTERNAL BUSINESS PROCESSES " (hereinafter referred to as VBP). Here indicators will be located assessing how effectively the internal services of your company. How long does it take to wait for delivery of goods from the warehouse? How quickly does bookkeeping issue closing documents? Is salary paid regularly? (And this, by the way, affects motivation).

The third rectangle below will be called " CLIENTS ". Here we will write all about the interaction with the buyers of our products and services. How fast the work goes, customer satisfaction, and so on.

And finally, the topmost rectangle is called " FINANCE ". There will be information about our income and expenses. Here we prescribe the task of raising the former and reducing the latter.

And above all this beauty we will write our strategic goals. To know what to strive for.

It turned out like this?


Now make 20-30 copies of this leaflet. You have many times to cross out what is written, throw it in the trash and write again.

It is important to remember about the relationship of perspectives.

All indicators and actions in all four perspectives are interdependent. For example, sending an employee for training will increase his degree of readiness for work in the perspective of R & D, but will require financial costs, which will adversely affect the outlook Finance. But then the quality of work with clients will improve in the same perspective, which will bring more money to the company, and this ... Yes, yes, the prospect will improve Finance.

Getting down to action

For now, forget about KPI. The fact is that any indicator can only determine how effectively an action is performed. But we have no actions yet and we just have to create them.

Take the first strategic goal from your list and perform a SWOT analysis. For the uninitiated, of course it sounds scary, but in fact you take another piece of paper, draw a 2x2 square. In the left column you will write about the strengths of your company regarding the implementation of a strategic initiative, in the right - the weak. In the upper internal factors in the lower appearance. Like this:


If you describe everything in detail and honestly, it will be clear what is helping you, what is stopping you - and most importantly, what needs to be changed.

For example . You want to double sales, but sales of your wonderful product are hindered by low salesman qualifications and the lack of specific functionality in the product itself. In the perspective of O & R, you enter "seller training." Spend from this inscription an arrow (connection) in the future Finance and write there "The cost of training." Spend from the "training of sellers" the second arrow in the perspective of customers and write "Improving customer satisfaction." But that's not all. Draw the third arrow, now in the perspective of PFS. They write “Refusal from the services of a logistician” (since your trained salesmen themselves invoice them). And from the words "Failure" draw an arrow in the future Finance and write "Reducing costs from staff optimization."
And of course, you draw an arrow from the increase in satisfaction in the future Finance - the sales should increase, for the sake of it everything was started.

It turns out like this:

(By the way, who does not like the pen and paper, write in Word, as I did)

Now you are doing the same with programmers. What should be done so that they add the missing functionality and on what prospects this will affect.

The list of actions (initiatives) is ready. Now you need to monitor performance.

This is where the KPIs finally appear.

First, we assign indicators to each of the actions we described earlier. I hope you remember that indicators can be not only quantitative, but also qualitative (good / medium / bad). It is necessary to strive for the majority of KPIs at the highest level to be precisely qualitative (and they will be calculated from a quantitative one). Because at first glance, many will not understand - sales of 1 million rubles. - is it good or bad?

Remember that the essence of KPI is that at first glance at the prospects it is possible to assess whether the plan is being executed or not.
In the case of training vendors, you can put KPI on the number of trained, on the number of courses completed, on the exam grades trained, etc. In the Financial Perspective, KPIs can be expressed either with amounts of money or in the form of estimated values ​​(they saved little, medium, much).

And now we are starting to decompose top level KPIs.

As you remember in our example there is an indicator dedicated to the training of sellers. Let's take a look at how it counts for the whole company.

We have several sellers. We measure the average score received by the seller at the exam and translate the quantitative values ​​(from 1 to 5) into qualitative (passed / not passed). Moreover, the formula can be arbitrarily complex, include lower coefficients for simple exams and elevated for important / complex.

Now we are starting to merge the KPIs of individual vendors into KPIs at the company level. To do this, you can use the formula for the arithmetic mean value, and you can assign a minimum value from the sellers' indicators (as long as there are losers in the team, training cannot be considered successful).

When the manager looks at the top level KPI and sees that the value of the indicator “Salesperson Training” is in the red zone “did not pass”, he will be able to go down a level and see who exactly of the sellers cannot pass the exam.

It was a bottom-up composition. That is, we know the possible values ​​at the lower level and on the basis of them we calculate the indicators of the upper level.
But in the case when the company has a sales plan and we start to assign individual sales plans to managers based on it, this is already a top-down composition.

As a result, for each employee of the company a number of individual indicators should be defined. Among other things, this approach increases employee involvement in the affairs of the company. He understands how his work affects the business as a whole.