Cascading Scorecards to Individuals

In this series of articles, we have focused on the cascade element of the Balanced Scorecard process. We have begun by looking at the Tier 1 top-level or executive scorecard and the cascade process to Tier 2 divisions and departments.

The third stage is the cascade of individual employees across the organisation. At this stage, the focus is on transforming the Tier 2 business objectives (departmental level) into personal objectives that will be used for individual appraisals and development plans. We will refer to this individual level as Tier 3.

How the individual cascade process works

The cascade process starts from the executive level plan and scorecard, developing this into departmental level scorecards with operational activities and then identifying how each individual will have responsibility for each element of the operational plan to ensure it is delivered. The process starts at the very highest strategic level, with a holistic cross-organisational view, travels down to the functional department leads who will need to plan their team’s activities and priorities accordingly, and then from here, travels down to every single employee within the organisation to ensure that human resources are leveraged fully to achieve each element of the plan.

The business leads with a responsibility for assigning elements of the functional departmental plan to individuals within their team use their management expertise to identify the right people for each job. The Tier 2 plan will provide the detail of each operational focus and activity, and managers within the department will be assigned as owners of each item, for them to manage locally. When assigning local owners or ‘doers’ for each item, line managers will consider roles, skillsets, experience and development areas. There may also need to be a creation of cross-functional working teams to achieve certain objectives, especially in today’s organisations which are moving towards a digital transformation. In such instances, objectives to ‘improve the customer experience’ are likely to be delivered by employees working in sales, customer services, marketing and IT, for example.

Taking an example

Let us take the example above to explain how the cascade process works at the individual level, or Tier 3. The tier 1 HQ-level strategic objective is to ‘improve customer experience.’ This will have cascaded down to, say, the Marketing department and been translated as a Tier 2 departmental level objective which is to ‘restructure our corporate digital assets to deliver a better digital customer experience’.

From this point, each individual in Marketing will be assigned activities that support this goal. These will be defined as a series of personal objectives, with an associated competency and behaviour or value (where these frameworks are used internally, performance measure and development need, where appropriate.) In the example above, our Marketing Assistant might be charged with creating a monthly social media blog plan to support the relaunch of the company’s branded social media accounts, and for producing five blog articles or explainer videos a month to be published across the brand’s digital assets.

The associated competencies might be communication and specialist expertise, with a behaviour that might fall under collaborative behaviour internally, to work with internal colleagues in sales for content gathering and to share the published content internally with wider staff through an internal communications channel, to build wider knowledge and understanding about external marketing efforts.

The associated performance measure might relate to timescales for the social media blog plan’s creation and timely production of quality blogs (measured by calendar dates and read / share rates.) The associated training need might relate to SEO friendly copywriting to meet latest Google algorithms. Now, this individual objective becomes robust, clearly defined and ready to deliver. The individual can rapidly understand their role in delivering the company strategy and trace their delivery right back up to the highest strategic objective.

Motivating your staff

Managers can instantly see that this process can be hugely motivating and engaging for staff when it is done correctly. As ever, the devil lies in the detail. This means training all managers to set individual objectives correctly and in line with a clearly defined process. It means training managers and supporting them to do this for the first time, where the process and framework is new. It means allowing sufficient time and resources to support this activity and checks and internal measures to ensure that it is happening consistently and that every employee ends up with a clear series of annual objectives for their performance review. (Many organisations now record individual plans digitally to automatically flag up where gaps are occurring and to more easily manage an otherwise complex process, especially for large organisations.)

In three steps then, we have gone from having a top-level Tier 1 strategic vision and scorecard right down to ensuring that every single employee in the organisation knows exactly what their role is in achieving the plan and what they will be measured against performance-wise for the year ahead.

Want to know more? Contact us today to find out how we support organisations of all sizes through the use of Balanced Scorecard Software to see real results in their strategic planning and delivery.