Rolling it All Together: A Balanced Scorecard for Government

Transcription

1 Rolling it All Together: A for Government 2002 by the and the U.S. Foundation for. All rights reserved. 1

2 Presentation Agenda What is the Government Balanced Scorecard? What s in it for Cities and Counties? What does a Real BSC Look Like? What are the Limitations of the BSC? What is the Future of the BSC? BSC Implementation Workshop tomorrow! 2002 by the and the U.S. Foundation for. All rights reserved. 2

3 What is the (BSC)? The balanced scorecard is a management system (not only a measurement system) that enables organizations to clarify their vision and strategy and translate them into action. It provides feedback around both the internal business processes and external outcomes in order to continuously improve strategic performance and results. When fully deployed, the balanced scorecard transforms strategic planning from an academic exercise into the nerve center of an enterprise by the and the U.S. Foundation for. All rights reserved. 3

4 Some Concepts in the Multiple Perspectives Balance Feedback of measurements Cascading Scorecards Cause-Effect Framework Strategic Mapping 2002 by the and the U.S. Foundation for. All rights reserved. 4

5 Four Perspectives of the Budget Financial Objective Measure Target Initiative Customers/Citizens Objective Measure Target Initiative Customers Strategy Internal Business Processes Objective Measure Target Initiative Objective Measure Target Initiative Learning & Growth Learning & Growth Source: Kaplan and Norton 2002 by the and the U.S. Foundation for. All rights reserved. 5

6 Balances in the BSC Lagging Indicators Diagnostic s Cost & Risk Low risk / low benefit Leading Indicators Strategic s Benefit & Value High risk / high benefit 2002 by the and the U.S. Foundation for. All rights reserved. 6

7 Operational and Strategic Feedback Metrics Strategic Plan Operations Plan Metrics Operational Budget Mission Activities Outputs Outcomes Strategic Budget Strategic Initiatives 2002 by the and the U.S. Foundation for. All rights reserved. 7

8 Cascading Scorecards 2002 by the and the U.S. Foundation for. All rights reserved. 8

9 Cause-Effect Hypothesis 4. Increased customer satisfaction will lead to better financial results. 3. Improved work processes will lead to increased customer satisfaction. 2. Skilled, empowered employees will improve The ways they work. 1. Knowledge & skills of employees is foundation for all innovation and improvements. Financial Customer Internal Process Learning & Growth 2002 by the and the U.S. Foundation for. All rights reserved. 9

10 Strategy Map Citizens Increased Involvement Increase Safety Increase Satisfaction Lower Wait Time Budget Reduce Costs Grow Tax Base Internal Business Process Learning and Growth Improve Cycle Time Improve Skills Reduce Procurement Steps Increase Network Capability 2002 by the and the U.S. Foundation for. All rights reserved. 10

11 From Strategy to Budget Strategy Map Metrics Targets Strategic Initiatives Customer approval rating Cycle time reduction % strategic skills available Each Strategic Initiative Plan contains: Sponsor Schedule Resources Budget 2002 by the and the U.S. Foundation for. All rights reserved. 11

12 Tying the BSC to Resource Decisions Feedback Corporate $ Results Mission Vision Strategic themes Perspectives Objectives Measures Targets Initiatives Capital plan Operating budget Special projects Analysis 2002 by the and the U.S. Foundation for. All rights reserved. 12

13 Popular Management Programs Strategic Management Systems Quality Certification Programs ISO 9001, Baldrige, EFQM, CMM Quality Improvement Programs Six Sigma, TQL, TQM, BPR, BPI Financial Management Programs ABC, ABB, ABM, EVM, ZBB 2002 by the and the U.S. Foundation for. All rights reserved. 13

14 What is the difference between private-sector and public-sector balanced scorecards? 2002 by the and the U.S. Foundation for. All rights reserved. 14

15 Comparing Private and Public Sector Organizations Feature Private Sector Public Sector General Strategic Goal Financial Goals Competitiveness Profit; growth; market share Mission value, effectiveness Productivity; efficiency; value Stakeholders Stockholders; Taxpayers; buyers; managers recipients; legislators Desired Outcome Customer satisfaction Customer * satisfaction 2002 by the and the U.S. Foundation for. All rights reserved. 15

16 Public Sector Mission Financial and Social Cost Value and Benefit Customers and Constituents Internal Processes Source: Washington State Auditors Learning: Skills, Knowledge, Data, People 2002 by the and the U.S. Foundation for. All rights reserved. 16

17 Commercial Customer Relationships Customer Competitors Funds Products, Services Supplier 2002 by the and the U.S. Foundation for. All rights reserved. 17

18 Government Customer Relationships Citizens Taxes (No Competitors) Suppliers Support Activities Representatives Agency Appropriations Budgets Department Costs Mission Activities Grants, Products, Services Recipients 2002 by the and the U.S. Foundation for. All rights reserved. 18

19 What are the BSC s Benefits for Local Governments? BSC Places the Whole Organization in a Learning Process Enables More Rational Budget Decisions Facilitates Improvements Improves Communication to Stakeholders Provides Data for Benchmarking 2002 by the and the U.S. Foundation for. All rights reserved. 19

20 BSC Benefits: 1. Learning BSC Places the Whole Organization in a Learning Process Aligns everyone to strategy in a single framework BSC improves itself over time: Selection of initiatives and resource allocation Cause-effect hypotheses process 2002 by the and the U.S. Foundation for. All rights reserved. 20

21 BSC Benefits: 2. Planning More rational budgeting in a world of rapid change Resource allocations based on performance Systematic, fact-based management displaces intuition and politics Anticipate future outcomes Leading indicators Cause-effect predictions Simulations made possible 2002 by the and the U.S. Foundation for. All rights reserved. 21

22 BSC Benefits: 3. Facilitates Improvements BSC Raises visibility of what s going on Identifies what most needs to be changed Helps to identify best practices BSC enables more opportunities for Innovation 2002 by the and the U.S. Foundation for. All rights reserved. 22

23 BSC Benefits: 4. Stakeholders Raises visibility of government activities Facilitates feedback Supports accountability 2002 by the and the U.S. Foundation for. All rights reserved. 23

24 BSC Benefits: 5. Benchmarking Org. A Process Benchmarking Project: 1. Identify Process 2. Establish Partnership 3. Site Visit 4. Data Analysis 5. Implementation Plan Org. B Process measurement data collected for the BSC can also be used as a basis of comparison with data from other organizations by the and the U.S. Foundation for. All rights reserved. 24

25 Why use the in Government? Why should you as a government leader try to achieve a balanced set of performance measures? Because you need to know what your customer s expectations are and what your employee needs to have to meet these expectations. Because you cannot achieve your stated objectives without taking those expectations into account. More importantly, because it works, as can be seen from the success of our partners. -- National Partnership for Reinventing Government, by the and the U.S. Foundation for. All rights reserved. 25

26 - Managing Results Government Roster Federal States Cities Counties Defense Virginia San Diego Monroe Energy Iowa Portland Fairfax Commerce Maryland Worcester Prince William Transportation Puerto Rico Seattle Montgomery Coast Guard Texas Austin Santa Clara IRS Minnesota Veterans Affairs Oregon Florida Washington Utah Maine 2002 by the and the U.S. Foundation for. All rights reserved. 26

27 Nine Steps to Success Framework being Implemented in a County: 1. Conduct an organizational assessment 2. Define strategic themes or focus areas 3. Develop objectives 4. Draw strategy maps 5. Define performance measures 6. Develop initiatives 7. Visualize & communicate performance 8. Cascade to business units 9. Evaluate performance and adjust 2002 by the and the U.S. Foundation for. All rights reserved. 27

28 Key Questions What is our mission? What services and programs are required and need to be provided? Mission Customers/Citizens Objective Measure Target Initiative Customers & Stakeholders How do we create value? What benefits do we need to provide? Budget Objective Measure Target Financial Initiative To prudently manage public resources, how should we allocate funds and control costs? Objective Strategy Internal Business Process Internal Business Processes Measure Target Initiative Learning Employees & Growth & Organization Capacity Objective To satisfy taxpayers, elected officials, regulators, and other stakeholders, at what business processes must we excel? Measure Target Initiative How will we sustain our ability to change and improve? 2002 by the and the U.S. Foundation for. All rights reserved. 28

29 BSC Implementation: First Steps Strategic Leadership Team training & workshops (Two workshops completed) Corporate scorecard building (assessment, strategy development, objectives, and mapping first draft completed) Corporate scorecard development with Executive Conference participants (October 17-18) Board of County Commissioners review (October 29) 2002 by the and the U.S. Foundation for. All rights reserved. 29

30 BSC Implementation: Later Steps training (Early November) BSC Implementation plan (Week of November 12) Corporate scorecard complete (Week of November 26) reporting and communication plan (Week of December 10) Train the Trainer training (November - December) Automation requirements and recommendations (December) 2002 by the and the U.S. Foundation for. All rights reserved. 30

31 City of Charlotte Had a Mission and Vision Public Service is Our Business Mission Statement The mission of the City of Charlotte is to ensure the delivery of quality public services that promote the safety, health and quality of life of its citizens. We will identify and respond to community needs and focus on the customer through: Creating and maintaining effective partnerships Attracting and retaining skilled motivated employees Using strategic business planning. Vision Statement The City of Charlotte will be a model of excellence that puts the citizens first. Skilled, motivated employees will be known for providing quality and value in all areas of service. We will be a platform for vital economic activity that gives Charlotte a competitive edge in the marketplace. We will partner with citizens and businesses to make this a community of choice for living, working and leisure activities by the and the U.S. Foundation for. All rights reserved. 31

32 Charlotte: Five Strategic Themes Community Safety Transportation City Within a City Restructuring Government Economic Development 2002 by the and the U.S. Foundation for. All rights reserved. 32

33 City of Charlotte: City Council Focus Areas Community Safety City Within a City Restructuring Government Transportation Economic Development The Corporate Level Scorecard Customer Perspective Reduce Crime Increase Perception of Safety Strengthen Neighborhoods Improve Service Quality Availability of Safe, Convenient Transportation Maintain Competitive Tax Rates Promote Economic Opportunity Financial Accountability Perspective Expand Non-City Funding Maximize Benefit/Cost Grow Tax Base Maintain AAA Rating Internal Process Perspective Increase Positive Contacts Promote Community Based Problem Solving Secure Funding/Service Partners Improve Productivity Streamline Customer Interactions Increase Infrastructure Capacity Promote Business Mix Learning and Growth Perspective Enhance Knowledge Management Capabilities Close Skills Gap Achieve Positive Employee Climate 2002 by the and the U.S. Foundation for. All rights reserved. 33

34 Charlotte Dept. of Transportation: P erspect iv e O bject iv e Lead M easure Lag M easure Custom er C-1 M ain tain th e tran sp ortation system C-2 O p erate th e tran sp ortation sy stem C-3 D evelop th e tran sp ortation system C-4 D eterm in e th e op tim al system d esign C-5 Im p rove service qu ality C-6 Stren gth en n eig h borh ood s C-1 Repair Response: rep air resp on se action C-1 Travel Speed: average travel sp eed by facility an d selected location C-2 O n-tim e Buses: p u blic tran sit on -tim e C-3 Prog ram s Introduced: n ew ly in trod u ced p rogram s, p ilots, or p rogram sp ecification s C-5 Responsiveness: % of citizen com p lain ts an d requ ests resolved at th e CD O T level C-6 Issue Response: d efin ed situ ation s w h ere CDO T id en tifies, resp on d s to n eigh borh ood traffic & m obility issu es C-1 H igh Q uality Streets: con d ition of lan e m iles 90 ratin g C-2 Safety: city-w id e accid en t rate; n o. of h ig h accid en t location s C-3 Basic M obility: availability of tran sit C-4 Plan Prog ress: % com p lete on 2015 Tran sp ortation Plan C-5 Co mm ute Tim e: average com m u te tim e on selected road s C-6 eighbo rhood-o riented Program s: p rog ram s im p lem en ted as a resu lt of Com m u n ity -based p roblem solvin g Financial F-1 Exp an d n on -City fu n d in g F-2 M axim ize ben efit / cost F-2 Costs: costs com p ared to oth er m u n icip alities an d p rivate sector com p etition F-1 Funding Leverage: d ollar valu e from n on -City sou rces F-1 ew Funding Sources: d ollar valu e from sou rces n ot p reviou sly available Internal Process I-1 Gain in frastru ctu re cap acity I-1 Capital Investm ent: $ allocated to cap ital I-1 Capacity Ratios: in crem en tal cap acity p rojects in targeted areas bu ilt v s. requ ired by 2015 Plan I-2 Secu re fu n d in g / serv ice p artn ers I-2 Leverage funding /service partners: n ew I-2 o. of Partners: n u m ber of p artn ers fu n d in g / resou rce p artn ers id en tified I-3 Street M aintenance Co st: cost/ lan e m i. I-3 Im p rov e p rod u ctiv ity I-3 Co st per U nit: cost p er u n it I-3 Transit Passenger Co st:cost/ p ass ger I-3 Co m petitive Sourcing: % of Bu d get bid I-4 In crease p ositive con tacts w ith Com m u n ity I-3 Pro blem Identification: sou rce & action I-4 Custo mer Survey s: su rvey resu lts I-4 Custom er Com m unicatio ns: n o.,typ e,freq. con cern in g service qu ality Learning L-1 En h an ce au tom ated in form ation system s L-2 En h an ce field tech n ology L-1 IT Infrastructure: com p lete relation al d atabase across CD O T L-1 Inform ation A ccess: strateg ic In form a- tion available v s. u ser requ irem en ts L-2 Inform ation Tools: strategic tools available vs. u ser requ irem en ts L-3 Skills Transfer: sk ill evid en ce in job L-4 Em ployee G o al A lignm ent: train in g / career d evelop m en t align ed w / M ission L-3 Skills Identified: key sk ills id en tified in L-3 Close th e skills gap strategic fu n ction s L-4 Em ployee Clim ate Surv ey: resu lts of L-4 Em p ow er em p loyees em p loyee su rvey 2002 by the and the U.S. Foundation for. All rights reserved. 34

35 Example: Views (top level) 2002 by the and the U.S. Foundation for. All rights reserved. 35

36 Example: Views (detail) 2002 by the and the U.S. Foundation for. All rights reserved. 36

37 Common BSC Implementation Challenges Mission, vision and strategies poorly defined or understood, and not actionable Strategies and goals not linked to performance drivers, outcome measures, individual goals, and incentives Budget and planning processes that are not linked Treating performance measures as an end, rather than a means targets set too high or too low Feedback that is tactical, rather than strategic Lack of meaningful employee involvement 2002 by the and the U.S. Foundation for. All rights reserved. 37

38 Limitations of Government BSC Requires High Level of Organizational Commitment Change management issues What s in it for me? Takes sustained effort to implement fully May create fear Raises visibility and accountability May lead to loss of data s don t solve anything Must be accompanied by initiatives Govt. BSC Implementations are scarce Few mature implementations Limited data published Lack of standardized metrics 2002 by the and the U.S. Foundation for. All rights reserved. 38

39 Future of the Increased Specialization Sector-based scorecards E. g. Health Care BSC Department-level scorecards E. g. Human Resources BSC Increased Sophistication of Tools Linkage to Decision Support Systems Simulation Systems 2002 by the and the U.S. Foundation for. All rights reserved. 39

40 Conclusions BSC provides a framework needed for strategic alignment and org. learning. Names may change, but some BSC features will continue: measurements Results-based planning and management Increased use of information technology Increased sharing of data for benchmarking BSC is not a flavor of the month but an evolving management concept by the and the U.S. Foundation for. All rights reserved. 40