Prudent organizations will critically examine their Scorecard framework at least annually to determine if its core elements are still appropriate in telling an accurate strategic story. A “best practices” benchmarking study suggests a majority of Scorecard practitioners do just that. In the study, 62% of participants updated their Balanced Scorecards annually, 15% updated every 6 months, while 23% updated every 3 months.¹ Let’s look at the core elements comprising a Balanced Scorecard system and consider how they may change over time.

In this example, the surveyed employee gives her group’s Scorecard 38 out of a possible 50 points. Any total over 35 would be considered positive, however, the composition of the scores provides as much insight as the aggregate. In this case, the Scorecard appears to be working very well in its intended capacity of informing employees about organizational strategy and providing a line of sight. It also appears this group reviews their results on a regular basis and uses the information to identify future improvement initiatives. However, it is also clear this employee is not happy with the reporting tool being used, the cause-and-effect linkages aren’t clear, and as evidenced by her comments, Scorecard results are not stimulating organization-wide discussions. This input is invaluable as managers and employees look to develop future iterations of their Scorecard.²

Money has always been central to any organization, be it private, public, or nonprofit, but as the stewardship function has grown exponentially, we’ve seen the advent of the Chief Financial Officer (CFO) to track the complex web of debits and credits while complying with ever-changing statutes and regulations. Similarly, as technology has transformed the way in which we work and live, Chief Information Officers (CIOs) have become critical contributors at the strategy table of virtually all organizations. Cast your glance anywhere in the modern organization and you’ll discover similar instances of specialization emerging: Chief Knowledge Officers, Chief Talent Officers, Chief Marketing Officers, and so on.

Most nonprofit and public sector organizations will employ many of the functional specialists outlined above and will also house a group known as “strategic planning.” While the specific duties of a strategic planning function can vary tremendously given the enormous number of definitions spanning the strategy spectrum, as a common thread, most will concentrate on scanning the environment, seeking new information, and using their findings to help inform the organization’s response to the changes it faces. The whole focus is on strategy formation. Strategy execution, however, is left to the entire agency: The responsibility for living the strategy, seeing it transformed into living, breathing reality each day is diffused among everyone occupying a cubicle, office, or suite within the organization. This is not surprising because strategy execution is everyone’s job and requires cross-functional collaboration to occur. But as we all know, simply willing the silos to disperse and have people come together in a spirit of strategic harmony doesn’t happen through slogans or speeches—the process must be managed as precisely and with as much rigor as every other specialty should organizations hope to achieve any benefit whatsoever from their strategic planning efforts.

Championed by Balanced Scorecard architects Kaplan and Norton, a new discipline is emerging within organizations seeking to bridge this strategy formation and execution chasm: the Office of Strategy Management (OSM). This novel approach applies the age-old wisdom of specialization to the challenge of executing strategy by resting in one group the dual responsibilities of facilitating the development of strategy and shepherding its execution, primarily through the Balanced Scorecard system. Let’s take a closer look at this office and explore how you may use it within your organization. As you will discover, the OSM could be considered an umbrella agency for many of the Balanced Scorecard tasks discussed throughout this book.

Analysis of organizations gaining entrance into the Balanced Scorecard Hall of Fame has uncovered the increasing prominence of the OSM. As recently reported, “the 2006 winners rate themselves more highly in establishing an Office of Strategy Management (OSM). 53% believe they are best practice at this, as compared with the previous two classes (14% of the 2005 winners and 33% of the 2004 winners). Such improvement in a short period of time seems to reflect the priority that organizations place on establishing and investing in OSMs.”⁶

The title of this chapter is “Sustaining Balanced Scorecard Success,” and the only way that is possible is through the efforts of a group solely responsible for strategy execution and utilizing the Balanced Scorecard. Therefore, I am a strong advocate of the OSM notion and encourage you to develop such an office at the very outset of your implementation. In my consulting work, I’ve always warned clients from day one that without a person or group holding the responsibility to run the program when the consultant leaves, it’s most likely destined to be about as stable as leaves blowing in an autumn wind. You don’t have to call it an OSM, perhaps that’s a bit too clinical for your liking. As with the Scorecard itself, the name runs a distant second to the practice itself. Establishing an OSM-like group—one that reports directly to your chief executive to ensure they have the power necessary to work effectively throughout the agency—is a giant leap towards making strategy execution a core competency within your organization.

In the following sections, we’ll trace the company’s Balanced Scorecard path, culminating in their development of an OSM in 2006.

The initial phases of the implementation took place during a time of significant upheaval at the company. A corporate restructuring that included job losses caused much unease among the company’s long-tenured employee base, and the Scorecard, designed to bring clarity to the organization’s vision and strategy, was reduced in many ways to an afterthought in management review meetings, as managers and employees alike struggled to understand their role in the new NB Power structure.

By 2006, with the pains of restructuring healing, the company committed to pursue its Balanced Scorecard agenda with renewed vigor and enthusiasm. CEO Hay, after conducting considerable research on the topic, determined that an OSM would greatly assist the organization’s efforts in breathing new life into the Balanced Scorecard process. Within months, a new resource reporting directly to him was hired, and the nascent office was in place, ready to energize the company’s strategy execution competence.

A little over a year later, the organization now has 75 cascaded Scorecards in place (on the way to 90), has created an innovative new process combining business planning, financial planning, and risk management, and have completely reengineered their management reporting and review process. It’s time to learn how they did it.

Undoubtedly, some among your ranks will resist the changes discussed in this book. We all know resistance to change is natural. I believe the techniques presented throughout the book will equip you with the tools you need to disarm cynicism and resistance wherever it resides in your organization. The Balanced Scorecard holds tremendous promise when wielded with passion and commitment. For those dedicated to the constant pursuit of improvement and an unwavering desire to advance towards your mission, you will find a powerful ally in the Balanced Scorecard. As difficult as the road of change may appear, always recall the words of inventor and change advocate Charles F. Kettering who reminds us: “The world hates change, yet it is the only thing that has brought progress.”