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The Balanced Scorecard Strategy Review Meeting

Posted December 13, 2009 8:20 PM by Ted Jackson

In my previous post, I discussed the easy part of building a scorecard and left us thinking about the hard part of managing with the scorecard. I tried to distinguish between the process of creating objectives and measures with doing something about having these objectives and measures. I believe strongly in the strategy review meeting. This isn't a once a year report, but it is a quarterly meeting where senior executives actually discuss strategy.

So, how does one discuss strategy? Most companies spend serious time every few years creating a 3-5 year strategic plan. These plans are guided by a similarly named sub-committee of the board of directors and typically are called "Strategy 2014" or something like that. A good plan has goals or objectives with measures and targets laid out. These documents usually have phrases like "We will double our revenue by 2014 (or grow to $750 million by 2014). We will lead the industry in a certain process by 2014. We will be the thought leader in this innovative field. We will grow our membership or customer base by 3x by 2014."

This board committee will want to see an annual report on the goals - if they are doing their jobs well. So the staff will prepare a report that shows the numbers and submit it to the board at the appropriate meeting. About 18 months before 2014, the board will begin meeting again to determine the strategic plan 2018 or 2020. You never really know if you met all of the 2014 goals because there is a new plan by 2013. Sound familiar? A good leadership team, however, is managing to theses goals. With their Balanced Scorecard, they understand the drivers, and they are pushing their departments and employees to meet these goals.

So, a strategy-focused organization will meet regularly, let's say quarterly, to discuss their strategy. This is not just a report out of the numbers. It requires a well managed process.

1. The organization gathers the data for the measures in their Balanced Scorecard.
2. The initiative owners report on their progress, marking milestones that are complete and accurately reporting on their issues.
3. The objective owners then analyze the measure and initiative information and determine if the organization is making adequate progress in achieving the objective.
4. The scorecard owner then reviews all of the input to set the agenda for the strategy review meeting. The agenda and appropriate pre-reading materials are sent out to the leadership team.
5. The leadership team then meets to discuss the issues and make strategic decisions.
6. Decisions are captured, next steps are outlined, and the team is set to follow up on the action items before the next meeting.
7. The minutes are communicated to the team, and a broader communication is sent to the rest of the organization about any decisions made as well as any adjustments to the strategy.

This is the outline for managing strategy. In a future post, I'll dig a little more deeply into the pre-meeting requirements. Let me know what you think.