A presentation on using the balanced scorecard performance measurement /management system integrated with enterprise systems such as Enterprise Resource Planning and Enterprise Asset Management.
2. Problem Statement
Provide a solution to the difficulties with
assessing the value of enterprise system
investments.
Investigate how a derivative of the
Balanced Scorecard System will facilitate
performance measurement of Enterprise
System.
3. Background & History
Evaluation of Enterprise Systems (ES) is
important to management.
Financial Metrics (ROI, EVA, IRR) do not
account for intangible (non-financial)
benefits.
ES expenses are significant & operations
impact the total organization.
4. What is the Balanced
Scorecard (BSC) System?
Technique developed by Kaplan & Norton
(1992).
Translates mission & strategy into set of
performance measures.
Provides strategic management system.
5. Balanced Scorecard
BSC Measures Organizational Performance
Across Four Perspectives:
Financial
Customer
Internal Business Processes
Learning & Growth
Performance measures assist in
establishing Key Performance Indicators
6. Strategic Enterprise Management
Process
Enterprise
Modeling
Sourcing
Data
Strategy &
Enterprise
Planning
Business
Consolidation
Performance
Monitoring
Take
Action
Define
Enterprise
Structure
Collect
internal &
external
data
Market &
Business
Strategy
Modeling &
Simulation
Enterprise
Planning
Risk
Valuation
Legal Cons
Mgmnt
Cons
Value
Adjust
Performance
Analysis
Management
Cockpit
Meetings
Change
Tactical
Targets
Change
Enterprise
Structure
Communicate
to
Stakeholders
7. What are our main focus areas? What results do we
want to satisfy our customer needs?
Mission
Vision
Strategic
Perspectives
Strategic Themes
& Results
Objectives
Strategy Map
Performance Measures
& Targets
Strategic Initiatives
What is our purpose? What do we do?
What is our picture of the future?
What performance “lenses” should we use to
evaluate results?
What continuous improvement activities are
needed to get results?
How do we create and improve value for
customers?
How will we know if we are achieving
the results we want?
Specifically, what projects and
programs will contribute to the desired
results?
Balanced Scorecard Strategic Planning Logic
9. Objectives
To assess both financial (quantitative)
and non-financial (qualitative) costs and
benefits of an ES system, through
the utilization of a modified
Balanced Scorecard (BSC)
performance measurement system.
10. Implementation Activities
Identify how the BSC can be utilized to measure both
quantitative and qualitative costs and benefits of the
implementation and use of ES.
Qualify KPI that categorize and identify both quantifiable
and qualitative costs and benefits for implementation
and productive use of enterprise systems.
Examine current approaches that add value to the BSC
methodology, and lead to the establishment of an
“Enterprise System Scorecard”.
11. Identification of Objectives
Financial
Increase revenue
Reduce costs
Develop accurate cost allocation model
Internal Business Processes
Develop and promote integrated enterprise processes
Develop policy review process
Develop integrated business model
Reduce paper-based processes
Employees and Organizational Capacity
Develop succession plan
Develop employee career planning
Enhance training & professional development
Customers & Stakeholders
Establish joint process to review and understand customer
requirements
Conduct ongoing passenger satisfaction surveys
Develop accurate revenus model based on financial reporting
13. Develop Process – Logical Model
Write a Rule
Why? To Enact a Financial Policy
So costs are allocated accurately
Allowing for detailed analysis
So that the cost
structure is understood
To develop effective revenue model
Why?
Process
Output
Intermediate Outcome
Intermediate Outcome
Intermediate Outcome
End Outcome
Why?
Why?
Why?
15. Enterprise Technology Stack
EAM
Business Warehouse &
Business Intelligence
Strategic
Enterprise Management
Revenue
ERP
Point of Sale, Mobile
Applications
Transactional
Analytical Strategic
Reports
Analytical
Reports
FI, MM, HR
Reports
Work, Asset A/R,
Customer / Lease
Reports
Transaction
Reports
16. Management Cockpit
KPI – Reporting &
Management Cockpit
Consolidation
General Ledger and
Profit Center Accounting Data
Profit Center Accounting
General Ledger
B/S Accounts
I/S Accounts
Management/Cost
Accounting
Non-Financial
Measures
