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NFP Balanced Scorecard

If you are trying to create a NFP Balanced scorecard, do NOT use the standard balanced scorecard model. IT WILL NOT WORK in a charity or not for profit organisation!  However there are ways to make it work…

We have done it in many Not For Profit organisations including Charities, Fund providers, Hospices, membership organisations, Credit Union, and others.  If you work in a not for profit we are happy to share our case studies. Give us a call.

How do you use Modern Balanced Scorecards and Strategy maps in Not for Profit organisations and charities?

If you are considering a NFP balanced scorecard to help you manage your strategy or performance, then please read this? I hope it will save you valuable time and money. It is not often realised that charities and not for profit organisations require a particular approach to the design of their strategy maps and balanced scorecards. This is not simply about the balanced scorecard perspectives: it is about the operating and service delivery models being fundamentally different to commercial organisations.

You have to capture the unique operating and service delivery model of an organisation, before you can capture its strategy. Only when you have both the model and the strategy, can you consider measuring and managing better. You need the right things to choose what to communicate, measure and manage. We capture the NFP organisation’s service delivery model, then their strategy, in the strategy map.

How are charities and Not for Profit (NFP) organisations different?

Some charities rely on funds, some on donations, whilst others raise money through commercial activities and some operate as social enterprises. Many operate a combination. Some charities provide direct services, some work in partnership, others work through partners to their ultimate beneficiaries. Each approach needs an appropriate funding and service delivery model on which you can then place your strategy for implementing that model.

The combination of funding model and service delivery model is the central part of your strategy. You also have choices to make about where to focus attention with limited internal resources and expanding external demand. The strategy you choose.

Now add in how you will develop the capability of your people and the organisation to deliver these services: the choices of attitudes, behaviours and values; the choices of delivery channels and the resources you need. Finally add in the allocation of scarce resources, and you have the essence of the strategy.

Fourth generation balanced scorecards in charities, not for profit and third sector organisations

We have a special approach developed with, and for, Not for Profit and Third Sector organisations. It is encapsulated in our Fourth Generation Balanced Scorecard approach. We are happy to share this with you. Ignore this and you may end up with a scorecard that has wasted time, money and will not contribute to delivery of your services. Get it right, and you will be clear what drives the delivery of services to your beneficiaries. You will also be able to describe and bring about change and improvement. You will be clear how the changes will ripple through your organisation to create improvements.

In practical terms this is how your strategy maps are structured so your strategy gets represented and captured correctly.

Most importantly, our clients tell us it makes sense, captures and expands their thinking and helps them bring about improvements.

How does the NFP Balanced Scorecard work?

Get the underlying service model for your charity or nor for profit organisation correct and you will be able to capture your strategy, communicate your strategy, align the organisations resources people and effort, and become much better at delivering results. This is what we have been doing for all these clients listed below (and many others besides).

Are you feeling the twin pressures of funding and service demand?

Charity Commission research told us that in 2009 56% of charities were feeling the effect of the downturn and a third are seeing an increase in demand for services. nearly ten years later and things can still be tough.  Fifty percent of charities expected the charity sector to recover more slowly that the main economy. Source Charity Commission. Meanwhile Public Sector cuts are affecting funding, local authorities are cutting services and still the demand does not go away. Managing a charity, at any time, is not easy.

Pressures on governance, risk management and resources

Then there is the governance, risk and resource utilisation agenda. How do we ensure we manage ourselves properly? Many of our engagements have been about demonstrating to the board “that our strategy will continue to be successful” or that “we understand and are managing risks appropriately”.

Other engagements with Not for Profit organisations have focused attention on managing their resources better and gaining as much engagement with staff as possible: helping staff do the right things, the right way, with the right approach.

In practically all the cases below, we have helped the management team address the underlying capabilities, culture and values of the organisation. These are the aspects that drive performance and results. If your balanced scorecard is not helping you with this, then we strongly suggest you replace it. Now.

Charity Governance needs attention at the same time as underpinning the service and funding.

Partnerships and the big Society

As well as these examples, we also have experience of linking to third sector and Not for Profit organisations from the many public sector balanced scorecards that work with partners in the third sector.

Not for Profit and charity balanced scorecard case studies

Diana, Princess of Wales Memorial Fund

Strategic (Board) and tactical (Management) reporting using a Modern Balanced Scorecard

We helped the grant giving charity, The Diana, Princess of Wales Memorial Fund, develop three strategy maps and balanced scorecards to take to their board. This helped them show a consistent strategy, being implemented in different, but appropriate ways, for quite different groups of beneficiaries.

There is a detailed strategic balanced scorecard case study of the Diana Memorial Fund work here

Southend on Sea Credit Union

Launch strategy review

SECU were 3 months from launch and wanted a strategic review to ensure that their first 2-4 years started off as they planned.

The work for the Credit Union used a 5 year view of the future, a Strategy map and balanced scorecard to chart the launch of a new credit union. This includes raising funds, gaining FSA approval, recruiting volunteers, establishing processes, marketing to members and changing perceptions about savings. Central are themes to help members move themselves from poverty, manage their own money and learn financial prudence and independence.

National Trust

Re-engineering the management processes and improving decision making

We helped the large charity, the National Trust, review the effectiveness of their management processes and recommended improvements to the management processes concerned with strategic thinking, planning, budgeting, resource allocation, delegation of decision making, management information, performance management, individual performance appraisal, target setting and incentive systems.

This work was conducted in conjunction with our partner consultancy, Tyler Mangan.

This involved facilitating a team of client staff from around the organisation helping them to identify the underlying issues, review alternative solutions and make recommendations to the executive team.

If you would like to discuss this work, please contact us directly.

National Adult Literacy Agency, (NALA) Ireland

Strategic Alignment, Board reporting and management performance using a Modern Balanced Scorecard

NALA support adult literacy in Ireland. They help people improve their literacy, advance adult literacy policy, conduct research into literacy and numeracy levels and solutions, make approaches to literacy teaching more effective and remove barriers for people with literacy difficulties.

NALA wanted to improve how they managed their strategy, managed performance and reported on their projects and programmes. So we helped them develop a set of strategy maps and balanced scorecards tthat worked through from their board to the main programmes of work. These programmes included policy research, political lobbying and influence, supporting partners and raising the profile of literacy and numeracy in the country.

If you would like to discuss this work, please contact us directly.

Dimensions: helping people with learning Disabilities to live the lives they want to lead


Regional strategy and performance using fourth generation balanced scorecard

We helped the Board of this large, Not for Profit organisation understand the performance of their regions, by helping them develop Regional Strategy maps and Scorecards. This was so successful we had spontaneous balanced scorecards breaking out. One Director said, “I have never come across an approach where there has been so little resistance”.

See our extensive case study and video of this not for profit Strategic Balanced Scorecard project

BEDIA: Trade and Inward Investment, Botswana High Commission:

Inward Investment & Export agency: 10 year vision, strategy and balanced scorecard

BEDIA (Botswana’s inward investment agency) wanted training and support to develop a balanced scorecard to manage their effectiveness in both inward investment and export development.

We went further. In a short, intense, workshop we helped them develop a view of the investment needs over the next ten years and so develop the overall size of the ambition for their investment programme

NFP Balanced Scorecard training

Not for profit balanced scorecard training course especially for fund raising organisations, charities and voluntary service providers.

We have an extensive charity training case study to teach the Balanced scorecard Approach and the use of the Tangible Future and strategy map for strategy focused not for profit organisations. This includes understanding donors needs, the beneficiaries, stages of development, research, campaigning, fund raising, recruiting volunteers, delivering services, creating replicable projects and working with partners.

Our balanced scorecard approach is readily adapted to social enterprises and organisations with both financial and social objectives, but where profit is not the ultimate end. Call us to discuss how we can help you with these social enterprise balanced scorecards.

With this range of experience, we can get your not for profit, charitable, or social enterprise strategy or performance management project off to a fast start.