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Imagine your strategic elements (themes, objectives, measures, driver measures, initiatives, initiative KPIs, and milestones) as an alignment “web” or “family tree” through which there are causal relationships. While some of these relationships are close, say 50-75% of their performance feed into the next element’s performance, others are distant, and perhaps say only have a 3-5% impact on another element from the same scorecard or from a cascaded scorecard. If there were only a way to represent that impact that would be wicked cool.
Now there is. The team has completed the build out of the ESM6 automatic performance status indicator setting iteration. If you want to in ESM6, you can activate this capability to have milestones and initiative KPI performance feed into the overall initiative performance. Initiative performance can then feed up into objective level performance. Similarly, driver measure and cascaded measure performance can feed up into strategic measures from both a performance status indicator level and at the raw data level. Strategic measures, cascaded objectives, and initiative performance indicators can then feed up into objectives and finally, objectives into themes. The ESM team is getting ready to automate your performance status indicators. Are you? We look forward to sharing this new capability with you soon.
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As we analyze our Execution Premium Community (XPC) site traffic from this past year we clearly see initiative management take the top spot. Strategy review meetings, leadership facilitation, measurement, and making strategy personal all sit as hot topics as well, but all came in half as popular as initiative management.
The team just finished the initiative management iteration for ESM6 and with its completion comes excellent capabilities in initiative criteria defining, ranking, and mapping. Through numeric weighting, ranking and scoring based off of how the initiative will impact the strategy, an organization will gain a solid grasp of which initiatives to select for their active portfolio. ESM6 initiative capabilities takes the user through the identification process, enabling you to brainstorm, propose, activate, pause, and complete initiatives in an easy to navigate interface. We look forward to sharing this new capability with you soon.
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Now that the Execution Premium book by Drs. Kaplan and Norton has been out in the market for a number of years, let's take a look at the benefits that can be realized through the XPP implementation in your organizaiton. Let's take it a couple stages at a time. Stage 1 and 2 looked at Develop the Strategy and Translate the Strategy, stages 3 and 4: Align the Organization with the Strategy and 4: Plan Operations. Now let's look at stages 5: Monitor and Learn and 6: Test and Adapt. In these last two stages, strategy becomes part of the fabric of the organization's management process and governance model right alongside operational review meetings. A business intelligence capability nees to be formalized and linked to the strategy. As part of testing the strategy, new insights should be shared, and strategic and operational processes can be altered to ensure maximum effectiveness. This feedback loop brings you back to strategy refresh, translation and alignment, thus closing the loop on the XPP management system. Some of the benefits realized in these final stages include:
STAGE 5: MONITOR AND LEARN
- Develops a BI competency center to assure accurate, timely data to improve decision making
- Develops an analytic information architecture to harness data, information, and insight
- Creates a governance process and calendar to manage strategy as a process that delivers results
- Conducts strategy and operational review meetings to ensure strategy execution is on track
STAGE 6: TEST AND ADAPT
- Confirms effectiveness of the strategy
- Models business and operational processes to optimize ability to execute the strategy
- Analyzes results in order to make necessary modifications to achieve performance outcomes. Provides direction on what is working and what needs improvement
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Balanced Scorecard,
BSC Hall of Fame,
Business Leadership,
Client Success,
Competitive Advantage,
Decision Making,
ESM General Information,
Initiative Management,
Innovation,
Reporting,
Sustainability
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Posted
9/14/11
@ 3:42 PM
by ESM Team ESM Team
Now that the Execution Premium book by Drs. Kaplan and Norton has been out in the market for a number of years, let's take a look at the benefits that can be realized through the XPP implementation in your organizaiton. Let's take it a couple stages at a time. Stage 1 and 2 looked at Develop the Strategy and Translate the Strategy. Now let's look at stages 3 and 4: Align the Organization With the Strategy and 5: Plan Operations. In these stages, the strategy has been clarified with scorecards and strategy maps at the enterprise level so now they need to be cascaded down into the business and support areas to ensure vertical alignment. Individuals might employ personal Balanced Scorecards and development plans to link the performance review process with the strategy. A communication program around the strategy is also paramount. The organization can begin to link strategy to key processes, driver models, and dashboards. Rolling forecasts and dynamic resource allocation are often found around the operational planning step.
STAGE 3: ALIGN THE ORGANIZATION WITH THE STRATEGY
- Defines the corporate role so that organizational units receive strategic guidance & direction
- Cascades strategy maps and scorecards to ensure organizational alignment to the strategy
- Leverages synergies between corporate, SBU, shared services, and other units to ensure alignment
- Communicates the strategy so that everyone understands his/her role in executing it
- Aligns team and individual goals and incentives to ensure the behavioral changes required for success
STAGE 4: PLAN OPERATIONS
- Identifies critical processes required to execute the strategy
- Establishes cross-functional business teams to drive performance across organizational boundaries
- Develops rolling forecasts and dynamic resource allocation to link strategy and operations
- Implements driver based planning to identify the critical levers of performance
- Creates operational dashboards that identify the key performance indicators that drive performance
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Balanced Scorecard,
BSC Hall of Fame,
Business Leadership,
Client Success,
Competitive Advantage,
Decision Making,
ESM Development Team,
ESM Features,
ESM General Information,
ESM Tips and Tricks,
Initiative Management,
Innovation,
Operational Reporting,
Personal Balanced Scorecard,
Reporting,
Risk Management,
Software as a Service,
Strategy Maps,
Sustainability
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Posted
9/7/11
@ 2:25 PM
by ESM Team ESM Team
Now that the Execution Premium book by Drs. Kaplan and Norton has been out in the market for a number of years, let's take a look at the benefits that can be realized through the XPP implementation in your organizaiton. Let's take it a couple stages at a time. Stage 1 and 2 of 6: Develop the Strategy and Translate the Strategy. These stages are where the organization performs S.W.O.T. analysis, Gap and shift statements, identifies key overarching strategies, clarifies the mission and vision and key risks. Then the strategy is developed into Balanced Scorecards and strategy maps. Typically an Office of Strategy Management (OSM) or other like group/individual is tapped to manage the strategy implementation and execution.
STAGE 1: DEVELOP THE STRATEGY
- Defines how shareholder value will be created to achieve new levels of performance
- Identifies required changes from current to future state so the organization understands it
- Quantifies vision, values, mission, objectives, and risks so they are measurable
- Analyzes strengths, weaknesses, opportunities, and threats to determine course of action
- Formulates strategy so that the entire organization can execute it
STAGE 2: TRANSLATE THE STRATEGY
- Clarifies strategy with a strategy map to produce a one-page action plan that works
- Develops a Balanced Scorecard to specify objectives, targets, measures, and initiatives
- Identifies key risk indicators that must be managed to avoid failure to execute
- Focuses on initiatives with the greatest impact to accelerate time to results
- Allocates resources dynamically to produce the most effective outcomes
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Balanced Scorecard,
BSC Hall of Fame,
Business Leadership,
Client Success,
Competitive Advantage,
ESM Features,
Initiative Management,
Innovation,
Operational Reporting,
Personal Balanced Scorecard,
Reporting,
Strategy Maps,
Sustainability
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Posted
8/31/11
@ 3:19 PM
by ESM Team ESM Team
Executives from 200 companies worldwide were asked how effectively they were meeting the financial projections set forth in their strategic plans: the results were staggering. On average, companies only reach about 60% of the potential financial performance promised!
In “Leveraging Planning Processes to Bridge Strategy and Execution”, the author Philip Peck argues that a disconnect lies between strategic and operational planning. To bridge the gap between strategy and execution, it is imperative that the processes, while different in approach, are integrated, aligned, and well synchronized.
According to Peck, the barriers to resource allocation are ingrained in a company’s organizational structure, processes, and information technology.
Strategic planning involves changing the business and looking ahead long term; while operational planning focuses on running the baseline business efficiently and effectively, with a shorter resource allocation timeframe. The antidote to bridge the gap and achieve financial success requires a holistic approach to the planning processes. Peck highlights four key areas where strategic and operational processes connect and offers concrete models to help organizations develop an integrated planning process.
View this, and other Palladium White Papers, HERE.
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The ESM team is hard at work innovating, designing and building ESM 6. This effort began in February 2010 and will continue through to Beta launch in early 2012. Through our recent surveys, direct client requests, and guidance from Drs. Kaplan and Norton and Palladium’s strategy consulting experts, we’ve compiled over 200 potential enhancements to include in this release.
As our developers share these new enhancements with the larger ESM team, we get more and more excited about where the ESM community is pushing the application. After all, it is you, the client, who’s advancing our application as you use it in your organization and provide us with feedback.
Some of the latest features to be built include automatic status indicator roll up across the scorecard. For example, milestone performance status indicator can impact the overall initiative status indicator, which in turn impacts objective performance status indicator. Objective status indicators can also automatically set based off of cascaded objectives and underlying measures. Measure can be automatically set by either data roll up or status color roll up. Objectives then roll up into perspectives and themes and then ultimately into an overall scorecard performance. It will be up to you if you activate this feature and just how far you want automatic status color setting to go in your organization.
We’ve also seen a new measure charting interface, allowing for unlimited data series, data calculations between columns, and multiple charts that can be displayed against the same measure data set. We will enable much more complex data roll up since different underlying measure series can feed into various higher level measures. For example, historically ESM required final calculated numbers such as a target, actual, variance, and forecast. With ESM 6, if desired, those raw data calculations can be done right in ESM or sourced in from data sources or data bases. We will also enable period groups for month to date, quarter to date and year to date summary series. Our measure charting enhancements should remove any restrictions users have felt in the past with complex measure calculations, roll up, and visual charting.
As we continue our development efforts we look forward to sharing our development efforts with you.
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I just came across an excellent account of the Balanced Scorecard effort undergone at the Royal Botanic Garden Edinburgh. In this paper, BSC champion and strategy director, Alasdair Macnab, along with Chris Carr and Falconer Michell from University of Edinburgh tell the implementation story. They focus their research on how the Balanced Scorecard approach can be successfully adopted for nonprofit businesses. The team also reviews why the Executive Strategy Manager was selected as the preferred solution and how it streamlined the data reporting and presentation while providing leadership and employees froma cross the organization critical line of sight into the strategy.
Key findings cited from the paper include:
Just as strategies are specific to an organisation, the balanced scorecard (BSC)/strategy map can and should be adapted to suit an individual organisation to leverage the full power of the BSC system.
• The effort and commitment required from senior management involved in transforming strategy management processes should not be underestimated as individuals/departments will become more accountable for their actions, particularly in the public sector, and resistance to change may be experienced as a consequence.
• If an effective costing system is developed, such as the one described in this report, management will see how their staff are directing their efforts, particularly important in knowledge based organisations.
• With their intimate knowledge of the organisation, the management accountant is well placed to become very involved or direct the transformation process to manage strategy execution leading to improved effectiveness/profitability of the organisation. In this way the management accountant becomes more of a strategic partner to the business.
• The research relates primarily to the practitioner who should find it helpful as the work is based on research subject to academic rigour but is translated into a pragmatic approach via the case study; thereby demonstrating its usefulness to a real organisation.
See:” Implementation of the balanced scorecard and an alternative costing system at the Royal Botanic Garden Edinburgh,” available at the following link:
Access the full report here
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Balanced Scorecard,
BSC Hall of Fame,
Business Leadership,
Client Success,
Competitive Advantage,
Decision Making,
ESM Development Team,
ESM Features,
ESM General Information,
ESM Tips and Tricks,
Initiative Management,
Operational Reporting,
Reporting,
Risk Management,
Software as a Service,
Strategy Maps,
Sustainability
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Posted
7/22/10
@ 11:43 AM
by ESM Team ESM Team
A recent post about hospitals on Harvard Business Publishing's blog is a good example of how organizational evaluation in general and best practice sharing in particular are great ways to minimize waste and mistakes. In the case of hospitals, this can save lives. Author David Champion describes hospitals that created initiatives to reduce infections, create saftey checklists, and overall, looked for ways to implement best practices. Hospitals found that by implementing these ideas and changing behavior throughout their organization, they saved money and lives.
Palladium and the ESM have a long history of working with hospitals and others in the healthcare industry to achieve their goals. The Executive Strategy Manager is a great platform for identifying organizational shortcomings, and for creating and executing initiatives designed to mitigate these shortcomings. The ESM is also a great tool for conveying best practices as described in
this earlier blog posting . Professionals in the healthcare industry can design their scorecards and strategy maps to reflect the objectives and methods they believe best, and measure their success. In times like these when organizations are short on cash, identifying simple and cheap ways to minimize cost are critical.
You can read the article here .
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Initiatives play the pivotal role of change agents for the Strategy Focused Organization (SFO). Many organizations fail to appropriately manage their initiative portfolio, and in turn lack the mobility to execute on their strategy. The successful SFO is able to focus the following key steps on initiative management: mobilizing executive leadership, translating strategy into operational terms, aligning and motivating the organization, and creating a continuous strategy review process. The ability to implement these key factors determines the fate of strategic change initiatives.
The Executive Strategy Manager gives companies the tools they need to implement their initiative management systems. The ESM is developed by the minds behind the Strategy Focused Organization, Drs. Kaplan and Norton, and provides the meeting management, communication, and governing tools organizations need to execute strategic change.
The Executive Strategy Manager allows for better meeting management by enabling you to communicate your corporate strategy and identify the key performance drivers at all levels of your organization. The ESM will help you create strategic alignment at the corporate, division, and individual level and encourage active participation in strategic themes throughout the organization. The ESM has proven itself as a successful guide in helping organizations create a sustainable strategy execution program.
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A company's success is often determined by their ability to adapt to a changing environment. While many companies will recognize the need for change, 70% of organizational transformations fail. Jayme de Lima says this failure comes from lacking employee commitment, as written in his article "Managing Change: Winning Hearts and Minds." A lack of downward communication in an organization hinders employee understanding on a personal level, which creates difficulty when trying to win over employees. Palladium's Executive Strategy Manager helps users communicate corporate ideology throughout an organization by aligning each employee with new corporate strategy.
Companies who lack a systematic change management program often lose steam with strategic initiatives before they begin to take root. By implementing the Balanced Scorecard Concept (BSC), companies provide concrete business goals throughout the organization. With a new goal in place for their business unit or management team, employees can see how company-wide transformations affect their day to day operations. The Executive Strategy Manager (ESM) provides the perfect tool for creating alignment during change in an organization. The ESM uses interactive tools to allow employees to track their contributions to the greater corporation's. Some of these tools include Personal Balanced Scorecards for individuals, cascaded scorecards from the corporate to business unit level, and My ESM to track employee goals that align with corporate strategy.
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Strategic Risk Management (SRM) is the key to an integrated risk management approach which Professor Mark Frigo discusses in his most recent article, "Strategic Risk Management: The New Core Competency." Professor Frigo sees the lagging development of SRM in a sea of new risks as the driving force behind the recent meltdown of financial markets. While companies focused on the upside of new business developments such as globalization and supply chain innovation, they made the fatal error of disregarding the associated risks. This evidence strengthens the need for a holistic approach to risk management in today's economy, an approach echoed by Frigo's emphasis on Strategic Risk Management within the Balanced Scorecard Concept.
One downfall found often in risk management approaches is a strictly siloed approach, where finance accounts for financial risks while HR manages their own risks. Though many companies strive for SRM, this movement has been hampered because "holistic performance management is still evolving, and many companies lack a culture or mechanism for managing cross-enterprise issue." This common mistake is where the Balanced Scorecard Concept (BSC) plays a pivotal role in successful SRM.
Frigo stresses the link between Strategic Risk Management and the BSC by concluding "[s]trategic frameworks like... the BSC provide a mechanism for managing strategic risk in an integrated and holistic way, across the enterprise." The Executive Strategy Manager(ESM) is a web-based software application that takes you step by step through both the construction of, and reporting on, Balanced Scorecards and strategy maps. The only application built and managed by the creators of the Balanced Scorecard, Drs. Kaplan and Norton, the ESM will help you create strategic alignment at the corporate, division, and individual level. The ESM provides the perfect resource for the company struggling to align it's Strategic Risk Management.
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One question I often hear as clients begin to incorporate initiatives into ESM concerns exactly where, in a cascaded scorecard environment, initiatives should be managed. This is especially applicable in organizations where there is an established project management organization that is practiced in dealing with the organization's major initiatives as a single group.
Some context on the issue; The ESM software organizes initiatives by scorecard, not by organization. Initiatives can be mapped to multiple objectives on a single scorecard or linked across scorecards, but must be explicitly designated as editable anywhere except their home scorecard. This might create tension in an organization that is used to discussing and managing major initiatives at a single enterprise level, but where some initiatives may only concern one particular scorecard.
An example might be a series of geographical scorecards and an initiative that only applies to North America, but not Europe. The initiative is strategic for the company, but since it is so important for that particular geography the leader wants to report on it from their cascaded scorecard as well as at the enterprise (Global) level.
Before we get to an answer, it is important to remember that the purpose of reviewing an initiative at a strategy review meeting is only in relation to the performance of a mapped objective(s), not for the sake of reviewing the initiative itself. This point highlights the difference between a project management office (managing projects) and a strategy management system (managing objectives being impacted by initiatives), though the actions may be similar (evaluate performance and make adjustments).
The question you should ask for each initiative then; at what level are the objectives involved going to be reviewed and in what situation are decisions able to be made to change the course of an off-track initiative?
If all the decisions are made at the enterprise level then all initiatives should be maintained on the enterprise scorecard. If though, an initiative is managed at some lower level and both the performance and correction steps together are presented as analysis at the enterprise-level strategy review meeting, it should be managed on a cascaded scorecard.
Decisions and approved correction steps concerning any element of an SMS are outcomes of a strategy review meeting. If at any point they become inputs to an enterprise-level meeting, then there is little reason to discuss them again because the decisions have already been made.
Delegating this decision-making authority for compartmentalized initiatives is a key best practice in implementing an initiative management system within the balanced scorecard framework and this is an area that ESM helps to reinforce the best practice. It reduces the number of items being reviewed at the enterprise level and concentrates maximum attention on items of the most strategic nature for the audience. Focused attention leads to better results.
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Palladium's Managing Director and CMO sent out a note this morning exploring Cari Tuna's article in today's Wall Street Journal.
An article in today's Wall Street Journal, "Executives Shift to Survival Mode," reports that The Conference Board has reconfirmed that executing strategy remains the number one issue facing executives worldwide. Palladium's value proposition addresses this issue directly, now prominently featured in the banner at the top of our home page:
Palladium Group is the global leader in helping organizations execute their strategies by making better decisions. Our expertise in strategy, risk, corporate performance management, and business intelligence helps clients achieve an execution premium.
The Conference Board, based in New York, conducted surveys in August and October; 190 executives responded to both surveys. The top two challenges of "greatest concern" cited were: (1)"Excellence in execution" and (2) "Consistent execution of strategy by top management." "Excellence in execution" (actually executing) moved up in importance by 9 percentage points in two months; "Consistent execution of strategy by top management" (consistently executing) increased by more than 5 percentage points.
That's what Palladium BSC Hall of Fame organizations do to achieve their execution premiums: achieve results, and consistently continue to achieve them. The concerns of executives around the world and Palladium's value proposition have never been better aligned.
The ESM supports Kaplan and Norton's best practice methodology to drive "excellence in execution."
To access the article, click on: http://online.wsj.com/article/SB122714668753343401.html
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I recently came across a case study, published just last month, titled "Information System Effects on Organizations Balanced Scorecard Work". This study was focused exclusively on the ESM application – something our team believes to be the first of its kind!
The study concluded that the ESM does, in fact, positively impact an organization's rate of successful BSC implementation and utilization. The findings also allude to a correlation between the time of ESM introduction and the avoidance of common pitfalls.
Read at http://biblioteket.ehl.lu.se/olle/papers/0002989.pdf or stay tuned for more!
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As you know, the typical Gantt Chart shows a project plan in graphical format. It typically has a bar for the major components to the plan and some way of displaying the tasks associated with the plan. So how does strategy fit into a Gantt Chart?
At the most simple level, a Strategic Gantt chart displays the initiatives and the key milestones associated with them. So in essence it looks like a normal Gantt chart but with strategic initiatives. But one of the keys to a strategy review meeting is being able to quickly evaluate information so that you can spend time discussing implications and actions.
The Executive Strategy Manager integrates the strategy components into a Gantt chart. It takes the initiatives and milestones and displays them in a graphic format, but it also then color codes them according to whether they are on track or behind schedule. So the Red, Amber, Green color status indicators show up in the Gantt chart.
The real benefit here is that you can quickly process information about your strategic initiatives. The leadership team can then decide how to apply more resources or change the scope of initiatives to better execute strategy.
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With the launch of web services in 2007, the ESM truly has become an integrated strategy management platform for organizations around the world. An early adopter with the web services, a government defense organization is streamlining the reporting process with their strategic initiatives.
In what used to be a completely separate technology and management process, this organization recently decided to link their customized strategic initiative software into the ESM. The design process entailed identifying the content to be linked between the systems and then writing a mini application to feed the data.
Organizations with in-house technical capabilities can write the application and those without can work with Palladium ESM programmers to build the correct web service. Palladium has a complete web service manual to support programmers through the process.
I look forward to Blogging on this organization's success with the web service in the near future. We anticipate a dramatic reduction in the time it takes analysts to enter data into the system, provide higher quality data, and ultimately, equip leadership with a complete picture of the strategic information necessary to make informed decisions.
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Building out initiatives without allocating a strategic budget is like financing a brand new Porsche GT3
and not having the pocket change to fill it up with gas. Organizations do this all the time. They go through the "fun" period of building out their objectives, drawing a fancy strategy map, allocating measures to report on those objectives, but wonder why their performance hasn't improved significantly.
Hey, you might have a heavy foot with that new Porsche of yours, but you aint going no where without the gas. It may look great parked in front of your house, but will those wheels actually move? That Strategy Map of yours might look pretty, but it won't get you anywhere without the proper resources.
I'm currently at Palladium's Global Public Sector Summit, and this morning I sat in on an initiative management clinic. This morning we discussed the four key aspects to initiative management: 1. Setting your Initiative framework; 2. Collecting, Rationalizing and Selecting Initiatives; 3. Funding, Planning and Tracking Initiatives; 4. Establishing the Initiative Governance Process.
I'm assuming that most of you have in some way or other completed Steps 1 and 2. Unfortunately, Step 3 sometimes gets overlooked causing the entire program to collapse. It is imperative that you analyze each of your initiatives cost benefits and align them with your short and long term organizational goals. As you do this, can should also distinguish the "Boulder's from the Pebble's". Determine which initiatives require the most manpower to get rolling, and alternatively which ones merely require someone to just bend down and pick them up. This will give you the right scope of your program.
Now you might be asking, ok, sounds great, but how do I actually track these programs and their budget? Well, this is where Executive Strategy Manager (ESM) 4.5 release comes into play. Client Administrators can now build calculated fields allowing users to easily track all of their budgets for their strategic themes and initiatives. Once you create these calculated fields, you can very easily allocate specific budgets for each initiative, and allow Initiative Sponsors to update the actual "spend" on each program. Furthermore, due to the enhanced layout functionalities, you can build custom layouts that show the strategy execution budget for your entire initiative program. Please contact your client administrator if you would like more information on building calculated fields.
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I was recently speaking to a colleague at an organization with whom I have worked with for a number of years. They are currently focusing on enhancing their initiative management process and utilize the ESM to support their corporate and business/support unit strategy management reporting process. During the conversation, he mentioned that each business/support unit has integrated their strategic initiatives into the quarterly strategy management report (SMR) and that the unit leaders have appreciated the additional insight and enrichment this component has added to their conversation.
Working with the corporate strategy group, my colleague was tasked to determine if the current initiative portfolio (encompassing both the ten corporate strategic initiatives and those initiatives identified as strategic at the business unit levels) would provide enough impact to successfully meet their annual corporate performance targets as outlined within their strategic objectives and measures. Imagining this could be a labor intensive process, my colleague phoned to see if I had any suggestions on where to start.
Before having the chance to respond, he outlined the steps he envisioned:
1. Build an Objective Linkage Report depicting the alignment of SBU (cascaded) objectives to corporate objectives
2. Build an Initiative Alignment Matrix for each SBU
3. Replace the SBU Objective with the appropriate SBU Initiative within the Objective Alignment Matrix to view the alignment of SBU initiatives to Corporate Objectives – thus creating an Initiative Linkage Report
4. Add the Corporate Initiatives to the Initiative Linkage Report
5. Add the status for each Corporate Objective to the newly modified report
6. Add the status for each SBU Initiative in the newly modified report
7. Print and review templates for any off-track corporate objectives and initiatives
8. Conduct analysis as appropriate
My concerned colleague then commented that by the time he builds the report he needed, he wouldn't have time to do any analysis.
Much to his surprise, I told him that Steps 1 through 6 were already done for him and that Step 7 would take no more than an hour. I then explained to my new best friend that because he had already created Corporate-SBU alignment within the ESM and the business unit core teams had mapped their initiatives to their respective objectives, all he needed to do was access Meeting View and navigate to the 'Alignment' tab, where he would find a copy of his 'Initiative Linkage Report'. To then create a template for any off-track Corporate Objectives or SBU initiatives he could simply click on that object and create a PDF export. Should he want an Excel file of the Initiative Linkage Report that can be found in the Document Library under the "On Demand Reports".
Glad to have made a call before heading down the wrong path, my colleague was able to save days of needless effort and was able to deliver a glowing report to organization's executive leadership – complete with supporting documentation available at the click of a button.
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Today, I wanted to share a few interesting things that I've seen clients do recently, to enhance the initiative reporting element of their strategic reporting process.
Traditionally, when an organization is reporting on a Balanced Scorecard, they start with the strategy map, drill down to view the performance of specific objectives (and their underlying measures), and might also view any initiatives that relate to these objectives. The analysis of initiatives, however, doesn't really go much deeper than that.
It's simply, "How does this initiative tie in and are we on track in completing it?" While this is all well and good from a project management standpoint, it doesn't get to the larger issue of whether the initiative is serving its intended purpose. Is it "moving the dial" so to speak, closing the performance gap on the objective(s) it's associated with?
To answer these questions, a number of our clients have taken a deeper look at initiative reporting adding in key elements of risk management and benefit management. To do this, they define more than just the initiative purpose and the key milestones when setting up an initiative.
They also track the expected budget, expected net benefits, and make sure that they have specific deliverable dates on each of their milestones. In the Executive Strategy Manager, they can do this by simply adding or customizing the appropriate fields that they want in the Initiative template.
When it comes time to report, they then enter the actual amount that has been spent on the initiative to that point, as well as the net benefits that have been realized. Furthermore, they gauge whether specific milestones that should have been completed by that reporting period have been completed, and also whether upcoming milestones have gotten underway. The review is summarized in some qualitative performance analysis and recommended actions.
This allows them, during a strategy review meeting, to go beyond project management reporting, and look at the critical risk factors involved in Strategic Initiative management. Are we varying from the allocated budget (Financial Risk)? Are we at risk of delivering what we have to by our targeted date (Schedule Risk)? Do we see the results that we expected (Impact Risk)?
If, in fact, any of these risk factors show up as "Red," in the danger zone, an educated decision can be made at that point whether to stay the course, make some changes, or kill the initiative and repriorize funding where it will have a greater impact (on a higher benefit initiative).
This type of initiative reporting stops a key problem from occurring: The problem of continuing to resource an initiative that is not generating any benefits. And as discretionary budget is a scarce resource, any gains that can be made in allocating this for maximum impact creates a competetive advantage for the organization.
To give you an example of how the Executive Strategy Manager supports this process, I'd be happy to show an image of what this report looks like for a sample initiative (I've just got to get the image formatted to display correctly here....to be forthcoming).
In any event, enough talk from me. If you have any question or would like to discuss more, please just post a comment and I'll follow up in a future post.
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