An Organizational Scorecard
An organizational scorecard brings a strategic plan to life. The scorecard is the roadmap for how an organization will accomplish the broad aims in its strategic plan. It drives progress by moving all department and unit arrows in the same direction and helps our teams understand their purpose and how their work matters.
A COMMUNICATION & WORKING TOOL
When used as a communication tool, the scorecard clearly and concisely provides the most relevant and important information about goals and progress. When used as a working tool, goals, measures, and strategic actions are aligned throughout the organization as the results scorecard is consistently reviewed and discussed by leaders and teams.
We find that when boards and other external stakeholders begin questioning organizational leadership, they are often looking for clear information about results and priorities. The scorecard provides those answers before ever needing to ask the question. Also, posting a results scorecard on the organization’s website establishes trust with the broader community and communicates its progress toward improvement.
The results scorecard tool is used to engage all team members in conversations about how individual effort helps the organization achieve meaningful results. The tool aligns goals, measures, and actions at the organization and department level.
The organizational scorecard brings focus by offering a plan on a page. Components on the scorecard are intentionally organized to help all stakeholders see alignment throughout the organization.
Pillars / Strategic Area
Pillars are the organization’s big picture areas of focus. The organizational scorecard begins with the pillars.
Goals on the scorecard are aligned to the organization’s pillars and are critical to the success of the organization. When used as a working tool, a complete goal statement on the results scorecard contains the measure of success. The measure on the scorecard is usually written in terms of “from ____ to ____,” with the blanks representing the change in amount or frequency.
Progress Monitoring Tool
Indicating a tool for each goal and measure on the results scorecard ensures the organization has a means of tracking progress. Monitoring organizational results is often used with tools like internal data reports, federal or state reports, and survey instruments.
The strategic actions on a scorecard guide our daily efforts to achieve the goals. We list the 1-2 priority actions the team identifies as the most important and most promising for getting us to each goal.
Scale & Weight Options
When used on a scorecard, the scale of measure reflects continuous improvement of the organization. A scale of 1 to 5 is set using the following definitions: 5 = Met Audacious Goal, 4 = Met Stretch Goal, 3 = Met Goal for Improvement, 2 = Stayed the Same, and 1 = Below Starting Point. For all measures, the baseline score at the “3” level is first established. From that point the 5, 4, 2, and 1 are created.
Each pillar/strategic area on a scorecard is weighted. Each pillar’s assigned weight is distributed among its aligned goals. For example, the People Pillar may carry a total weight of 20%, with two goals under that pillar carrying 10% weight each. The total weight on a scorecard equals 100 points. The aim is to assign weight in a way that further focuses the organization’s efforts.
CASCADE & ALIGN
Once the organizational scorecard is established for the larger organization, goals and actions are cascaded to division and unit leaders. Alignment of goals enables employees to trace the purpose of their work in relation to organization-wide goals and supports the achievement of big aims by ensuring that all arrows point in the same direction.
The process of cascading organizational goals to division leaders starts with a review of the organizational scorecard. Then, each goal is assigned an executive champion.
The discussion of how each goal should look for each division is key to establishing and maintaining alignment and clarity throughout the enterprise. While the CFO will likely champion the organization’s revenue goal, a CIO is still responsible for implementing strategy to support achievement of the overall revenue goal in his/her respective division. The goal will be modified based on the division’s data and specific contributions, but each division leader’s scorecard will reflect the bigger picture. This supports the success defined by the organizational scorecard.
Unit leaders are those in mid-level roles, responsible for the success of teams or special projects. These leaders often report directly to division leaders or, in some cases, to the organization’s executive leader. The creation of unit leader scorecards follows the same structure as the division and organizational scorecard. Goals are organized by pillar/strategic area and modified based on the unit’s contribution to the organization’s success in each area.
AN ORGANIZATIONAL SCORECARD PROCESS IN 3 STAGES
- Identify the organization’s Pillars aligned to the organizations’s Strategic Plan
- Create annual Goals aligned to each pillar
- Determine the Measure and Tool for each Goal.
- Decide the 1-2 Strategic Actions for each Goal
- Decide on the option to include a scale of Measure and Weight for each Pillar area and Goal, and define those scales and weights, if needed.
- Cascade the Organizational Results Scorecard to Division and Unit Leaders.
- Transparently share the Organizational, Division, and Unit scorecards.
- Track progress metrics quarterly, monthly, and weekly in unit meetings.
- Monitor strategic priority actions and adjust appropriately.