Your organization is excited about implementing the Balanced Scorecard (BSC) or a similar strategy management system and you have created strategy maps for the enterprise and 10 business units, you have identified the measures you will use to track your progress, and you are even implementing initiatives aligned to strategic objectives. So, you’re BSC project is done, right? No way!
While building over 10 scorecards for your organization’s strategy is hard work, now you actually have to make sure you are going to execute the strategy. Ensuring execution involves gathering your measure and initiative data, analyzing the data, putting together reports, reviewing the reports with leadership of the organization and business units and making decisions, and ensuring those decisions are executed on. That is still a lot of work to do on a monthly or quarterly basis and who is going to lead it?
The Office of Strategy Management (OSM), that’s who. Whether the OSM is a team of one or five, strategy focused organizations are finding that it is a necessary function to help ensure they execute their strategies. Drs. Kaplan and Norton, the creators of the BSC, have written about it in their article, “Creating the Office of Strategy Management”, and in their book, The Execution Premium.
But why do you really need an OSM? Here are our Top 5 Reasons:
- Everybody in your organization already has a job. Strategy is everybody’s job, if you’re one of the better organizations, but nobody’s responsibility. While the strategy is ultimately the responsibility of your CEO, president, or executive director, does she have a direct report specifically responsible for ensuring it is implemented?
- Reviewing as many as 10 or more scorecards on a monthly, or even quarterly, basis is A LOT of work. As soon as the strategy review meetings are complete, it is time to start preparing for the next one. Someone must ensure the process is ongoing.
- The benefits to be gained from implementing your strategy will far outweigh the costs of hiring a few people to form the OSM (or replace those existing employees who move into it).
- For a strategy to be effective, multiple scorecards across an organization cannot be managed in silos by the individuals in each unit. Strategies are cross-functional and need to be managed by people with the ability and mandate to reach across the whole organization.
- It sends a message. When an organization sets up an office to manage its strategy that reports directly to the CEO, it tells the rest of the organization that the strategy is important.
Look for upcoming posts that will dive into the processes, roles, and responsibilities of the OSM.