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Most of what we see in “Balanced scorecards” are technical tools. Many of the questions we see and hear on balanced scorecard forums are technical questions.  Many balanced scorecard projects are seen as, primarily, technical projects.

This applies to of all generations of balanced scorecards and many implementations.  To many, the whole approach is thought of as a technical solution with an emphasis on strategy being captured in diagrams (Strategy maps), alignment of the organisation around that strategy and having a clear systematic view of how the strategy will be implemented, supported by initiatives and measures and scorecards.

I suggest to you that thinking of these tools as technical tools is entirely the wrong frame.  In fact they are social tools, that are designed to create conversations.  Thinking of these tools as social tools entirely changes how you design, cascade and use them.  Thinking of strategic balanced scorecards as fundamentally a social tool, rather than technical one, is one reason for the generational change to fourth generation strategic balanced scorecards.

It you are looking for technical balanced scorecard solutions, look elsewhere.  If you are after real change from your balanced scorecard project, read on.

Why do we think of balanced scorecards as a technical tool?

Well in first and second generation balanced scorecards we see a dominance of measures and KPIs and targets.  These balanced scorecards must be technical tools, right?

In the books we see strategy maps supported by balanced scorecards.  these are a technical description of the strategy, right?

Even third generation balanced scorecards designed to make strategy implementation or execution a systematic process is really a set of technical tools, right?

measures motivate right.  What gets measures gets managed.  It’s a technical question, right?

Software providers provide us with balanced scorecards tools to capture and automate the collection of these measures and initiatives.  That is a technical issue, right?

It is not helped by those designers and implementors of balanced scorecards who treat the approach as a technical one of, “Do we have the right objectives, KPIs, measures, targets,etc.

This misses the point.  All these people are thinking of the approach as a set of technical tools.

They are missing the point and heading down a route towards project distress.

The Balanced Scorecard system is not a technical tool: It is a social tool!

The whole Strategic balanced scorecard approach is designed to create conversations and understanding so strategy happens.  The tools are incidental to what goes on in people’s heads when you run the process.  The approach is really a set of social tools designed to create shared understanding  so decisions are made consistently and the strategy happens.

The approach is a set of tool and techniques that are social tools, not technical tools.

Leaving the boardroom all telling the same story

I often joke (deliberately) that my job is to help an executive team or board all leave the room telling the same story.

Embedded in that idea is the fact, as most people realise, that is not always an easy task.  The tools of tangible futures, strategy maps, cause and effect, focus, that i use when i am facilitating a conversation in the board room or executive suite, are designed to elicit the ideas that the team have in their heads and get them out into the room to be shared and discussed.  Most of the time I am helping a teal share their deeper thinking, their beliefs about the future, their analysis of the underlying causes of problems in the organisation.

I am helping that team with their quality of conversation.  I am helping them to socialise their thinking amongst themselves so they have a shared and consistent view.  So they know where they agree, and even where they remain to disagree.  More importantly so they can all leave the room telling the same story having agreed on the same  course of action: where they will focus their efforts with their strategy.

I am helping them, using some apparent technical tools, socialise their ideas.  Socialising them first amongst themselves and then amongst their wider organisation.

How you facilitate, is more important than the techniques

What you have probably realised is that the facilitation of the techniques is as important, if not more important, than the techniques and tools and diagrams that emerge from the process.

This is a realisation many consultants and practitioners miss.  They think they can disappear into a dark room and come up with some measures or even strategy maps.  They can, but they will only have socialised and developed ideas and thinking for the people in that room.  the managers, executives, staff who own and execute that strategy will just receive some picture or set of measures they have no ownership of.  Is it a surprise that projects approached in this way fail to have any lasting effect or impact?

I have come to the conclusion over the years that the whole approach is about promoting the “Quality of conversation, thinking and decision making” within and among teams in organisations (and outside).

It is about the story: getting it into people’s heads

One of the reasons we do strategy map work is to identify the few things that will make the biggest difference.  To identify what the cause and effect model is.  To identify the story of the strategy.  The strategy map then supports the story that the executives and managers tell.  They can add their own anecdotes to exemplify the how the customers are changing their thinking, where the processes we operate are failing, how silo working can no longer be acceptable and where joined up thinking and working is exemplifying the new way of operating.

The idea is that these strategy maps, not only allow you to track progress with the strategy, first they have to tell that strategy in a compelling way.  They are a tool  (just one of many) that you can use to socialise your strategy.

Socialising your strategy means more that simply communicating it.  Communicating your strategy suggests you can stop when you have told them enough times.  Socialising your strategy means you only stop when you see the conversations, behaviours and peer pressure amongst a team changing.  When you have socialised ideas into the social fabric of the organisation.  When you have changed the social networks that exist.

It is about culture and behavioural change

One problem with thinking of the approach as a set of technical tools is that it assumes the models of behavioural and cultural change embedded in technical solutions.

It might not be obvious but the assumption in a technical solution is that measures motivate, targets get done first and having a scorecard will inrpove the discipline of performance.

There is nothing in here about the existing culture of performance and deeply embedded learnt behaviours.  If you have a target culture, then you will continue with a target culture, whether you want to or not (a recent client was clear that their target culture had served them well but was no longer appropriate).

If you have a poor discipline of meetings and decision making, where perhaps peopel work in and report in silos, but you want to break that down and create joined up thinking and working, the technical tools won’t help you.

Little in the technical tools addresses the deeply embeded culture and behaviour.

The primary approach to culture change of most technical biased balanced scorecard is through logic (These are the right things to do) and power (Achieve these targets).  There is little that addresses the peer pressure and social pressures that exist in an organisation that aintain the existing learnt behaviours ands culture.  In otherwords, technical solutions do little to change existing embedded cultural and behavioural norms or practices.

So nothing will really change and the project will have limited success.

The scorecard is also a social tool

Ok, let us talk about the scorecard part of the balanced scorecard as a social tool.

Yes it looks like a technical tool with objectives (if you are lucky) and measures and targets.  But in reality what is its purpose.  It is not merely control.  it is a tool to create conversation about what needs to be achieved and how progress is being made.  it is a tool to HELP diagnose where problems lie and support the diagnosis of those problems so that the outcomes and end results are being achieved.  It is a tool to help a team coalesce around some shared common ideas and intent.

The scorecard part of the balanced scorecard is a merely a tool that support the wider issue conversation about how decisions are being implemented and progress is being made.  It is a social tool, masquerading as a technical tool.

This is where many software providers go wrong.

They think their balanced scorecard tools are supporting the collection and presentation of measures.  They are not! That is the minimum they should do.

They are creating tools that support conversations about the diagnosis of problems, providing evidence and information that supports decisions, they are providing information to direct further actions that people can agree on.  They are providing information that creates a quality of thinking, quality of evidence, quality of conversation and quality of action and learning.

The problem is that many tool providers don’t recognise tis.  Look for where the pieces are to capture that conversation and enable it in any tool.  They are usually an add-on, if they are there at all.  They miss that their purpose is to support that conversations and the social interactions that result in things getting done better or differently.

David Norton agrees with me

David Norton, along with Bob Kaplan, was one of the originators of the balanced scorecard approach.  David was kind enough to provide the foreword for my book, Strategy Mapping for Learning Organizations.  In that foreword he points out that for many years they have realised that the leadership aspects of strategic balanced scorecard implementation are as important as the management and technical aspects.  As he puts it you need both left and right-brained thinking to succeed.

It is this that he picks out my book.  He goes as far as to say that in doing this, “Phil Jones make a unique contribution to the field of performance management”.  Now that is praise indeed.

However in my mind I am only pointing out the obvious, from my own experience.  The obvious is that culture and leadership are as important as the management systems and technical aspects, if not more important.

What does this mean for your balanced scorecard project?

Most practitioners or implementors think they have finished when they have the technical solutions implemented.  The measures are designed and the information is available.  That is not even the first step.

The intelligent practitioner or implementor realises that the project is successful when others own the ideas as their own and are implementing them.  You have created the social conversations and socialised the strategy.

However, this will only happen if you treat the approach as a social tool not a technical one.

And doing that requires quite a different way of framing the problem, approaching the project and recognising what success looks like.

Of course if you would like to hear about clients that have socialised their strategy, created cultural and behavioural changes achieved these sorts of results, then get in touch.