How To Promote The Strategy With The “Comprehensive Command Table”

How to promote the strategy with the “Comprehensive Command Table”

Introduction

At present, companies have many tools for the definition and planning of corporate strategies. There are many tools that are very useful in a specific area, but they are not necessarily integrated with all the departments of the company. This is the difference of when talking about Balanced Scorecard, a tool created professor Dr. Robert s. Kaplan of the Harvard Business School and the DR. David p. Norton.

The Balanced Scorecard includes the financial, learning and growth, customer and internal business processes perspective as a system for strategic management. In the following essay, each of the perspectives covered by the Balance Scorecard is described, which companies can do for the successful implementation and what are the results obtained.

This tool has been very useful for companies when wanting to set corporate objectives, align them with the goals of each department and effectively communicate the company’s strategy to the operational level. The Balanced Scorecard is a tool that can be applied in any company regardless of its activity, seniority or size.

Balanced Scorecard

The first article, "using the Balanced Scorecard as a strategic management system", talks about how the transformational change of companies opened the way to introduction of a new concept called "Balanced Scorecard" not with the idea of ​​being a replacement for existing financial measurements, but rather as a complement to these.

The Balanced Scorecard allows to manage the strategy of companies from four different processes. The first process is to translate the vision, which helps managers to have a clear vision based on the organization’s strategy. In many cases, employees are clear about the company’s vision, but they do not know how their daily activities contribute to the fulfillment of it, there are also different interpretations of what the company’s vision really is.

The second process is to communicate and link, this process allows the company’s senior managers to communicate the strategy and goals of the company at all hierarchical levels of the organization and thus be able to align the objectives of each department and personal objectives for that contribute to the fulfillment of the main goal of the company.

The Balanced Scorecard clearly establishes, both for the person and for the company, which is the objective to be achieved with shareholders and customers. To align the strategies and meet the objective they usually use three activities: communicate and educate, establish goals and link rewards.

In order to implement a strategy, you must begin by communicating and educating the people who are going to execute it. You must work in a communication program through electronic newsletters, assemblies, boards ads or any other means to socialize employee strategies and objectives. Communicate the Balanced Scorecard as a representation of the strategy will result in a greater commitment and sense of long -term responsibility by employees.

Personal Scorecard helps communicate the objectives of the company and allows to transform those corporate objectives into specific and individual tasks and goals. Compliance with these individual goals should have a certain link with rewards. Each company is free to choose the distribution percentage, but as an incentive for compliance with the goals these have to be tied with the performance evaluation and annual rewards.

The third process is business planning, during this process companies can make an integration of their business plans and their financial plans. One of the main problems is that companies have procedures and goals that do not necessarily contribute to the fulfillment of the corporate objective. Using the Balanced Scorecard forces companies to integrate their strategic plan with their budget planning processes, this helps ensure that the budget supports the strategies.

The four feedback and learning process allows companies to have strategic learning. Traditionally companies focus their review and feedback on the results of the company, departments and people. With the Balanced Scorecard, three additional perspectives are evaluated: customers, internal business processes and the performance of the strategy. This allows companies to modify their strategies that reflect real -time learning.

The second article, "Volkswagen do Brazil: how to boost the strategy with the control board", introduces us to a general landscape of the Brazil industrial.

Brazil was in fifth world place in terms of territorial size and population. Had abundant natural resources, an attractive consumer market for its large number of inhabitants. Brazil had its world importance after several economic crises, the government established a plan that managed to reduce inflation rates and turned its economy into the most important in Latin America.

The automotive industry generated 19% of GDP, they were used directly and indirectly more 1.5 million people in more than 200,000 companies and the production of 4 million cars per year was as a total capacity. One of the main companies in the industry was the Volkswagen Group, which used more than 370,000 people. The fort were small and medium cars, but it had the most complete car portfolio in the Brazilian market.

In 2007, Thomas Schmall assumed the CEO position of the company. As the first change he transferred the administrative offices near the production lines where they could have greater control and planning. Schmall had the objective for forming high performance equipment to “recreate” the brand and eliminate administration based on cost reduction.

During the same year, Casrteenisese assumed the company’s CFO position. Inseensee had dedicated himself to the areas of approach and finance all his professional career. Upon assuming the he found a company that was facing a period of cost and personnel reduction, which caused demotivation and uncertainty that the plant could be closed for not being profitable.

A year earlier, in 2006, Josef-Fidelis Senn assumed the position of Vice President of Human Resources of the company. One of Senn’s main tasks was to coordinate everything related to RH globally and manage difficult negotiations that involved reforming the union contract. Senn was one of the people who helped during the implementation of the control board and who led the change of management approach causing a change in culture.

In order to make a change in the company, a new approach to senior management and a tool that will help them in that change was needed. First the new objectives of the company were defined: satisfy the expectations of the customers, improve the image of the company, improve efficiency and costs and promote a high performance culture. With the defined objectives, Schmall informed the team the importance of developing a strategic map.

The map would clearly and objectively define the company’s strategy. Relationships would be defined on the map and demonstrate how employee results clearly become financially tangible results. The most important thing is that the map would translate strategy in a language that everyone could understand, in this way it could be socialized with operating levels.

To achieve this, communication programs were launched that included training, meetings, special events, etc. Within one of the most successful communication initiatives is Giga, a one -meter high robot that had the characteristic sound of the 1960 VW beetle. The robot was always in the special events and towards questions about employees about the company’s strategy. Table games and roles games were also made with the same purpose. Volkswagen considered that in order to have a high performance culture they had to reach the heart and mind of each employee.

To reinforce all communication companies, Schmall made a connection between employee results and compensation developing a bonuses plan. Apart from implementing a management development program where people with high performance were identified and developed to be able to opt for a management position.

The implementation of the control board led to Volkswagen in just two years to raise its market position, create a greater commitment on the part of the employees and reduce the absenteeism index and accidents of the plant.

The third article, "Balanced Scorecard for entrepreneurs: from the Canvas model to the comprehensive command box", it tells us about the integration of the Comprehensive Command Table and the Canvas model and how this serves as a new tool for entrepreneurs.

It is necessary that entrepreneurs can use the Balanced Scorecard to establish clear objectives in the four perspectives established by the tool and that these objectives contribute to achieve the corporate objective.

The Canvas model is one that facilitates the visualization and compression of the company’s strategy. However, the tool does not specify goals or objectives much less to establish a measurement method which makes the tool cannot be used for supervision. Therefore, entrepreneurs are suggested to design the Balanced Scorecard through the Canvas model.

The proposals in the Canvas income and cost flow section facilitate the definition of objectives and goals in the financial perspective. The proposals in the customer and relationships section with Canvas clients facilitate the definition of objectives and goals in the financial perspective. The proposals in the CANVAS DISTRIBUTION AND ACTIVITIES CHANNELS section facilitate the definition of objectives and goals in the internal processes perspective. The proposals in the CANVAS key resources section facilitate the definition of objectives and goals in the learning perspective.

Designing a Balanced Scorecard through the Canvas model there is a high potential that contributes in the development of new businesses since it allows the entrepreneur to identify the main variables, define the objectives and goals and be able to align them with the rest of the company, in this way You can have under control the four perspectives of the company that will lead us to the fulfillment of our corporate objective.

Personal analysis

Throughout my short professional career I have had the opportunity to carry out professional internships and have a formal job in several companies in different areas such as: sewing, textile, food and construction. In all the companies in which I have worked, they had clear goals and objectives as an organization, but not in all companies those objectives were clear for departments and people. This was something that impacts me a lot about the Balanced Scorecard, the communication of the goals to the operational level.

I consider that senior managers and managers can align the goals of the departments with the company’s goals, but this will never have the same impact if it communicates with the staff and there is a sense of belonging. Volkswagen is a clear example, they started with a mass communication program and from the same employees many more innovative ways to share the business strategy came out.

This reminds me of how in companies we can see that quality or security campaigns are made. In the company that I work today, industrial safety campaigns have managed to change the company’s culture. This shows me that these changes really can be achieved. Why could we not carry out communication campaigns to socialize company strategies?

I consider that the fact of translating the vision of the company into a language where it is understandable for all employees and sharing it creates an impact on people and generates a sense responsibility because knowledge is created as each activity of a job affects in The company’s objectives.

In my opinion, the human resource is something invaluable and is the engine of a company. Without people with the correct motivation or correct orientation all plans can come down. Seeing how Volkswagen changed a whole culture and created a sense of belonging in his team left me impacted from the achievement of this tool when it is well implemented.

A very important point to highlight is that the tool can be applied to any type of company, any sector, size, seniority, etc. The Scorecard balance is not limited to a specific type of company. I also consider that it is a great tool for any entrepreneur because, although failure is part of success, we can often fail due to a lack of planning or vision.

In Honduras, we are not recognized for being great planners. We are characterized by being late or reaching "Honduran time". This tool is very wide and covers the four key perspectives of a company. If this knowledge could reach small and medium enterprises, they could have high probability of becoming large, as well as Volkswagen managed to get out of its hard stage.

I consider that the Balanced Scorecard is a fundamental tool for any emerging company, since you can have a clear vision from a beginning of where I want to take my company and allows you to work in an organized way following a strategic plan.

Conclusions

We can conclude that the Balanced Scorecard is an excellent methodology for the implementation of effective strategy management, this makes it a powerful tool that gives companies a competitive difference and most of the time you can see the clear difference against the competition.

Currently, the Balanced Scorecard tool has been successfully implemented by several companies from different sectors, demonstrating their versatility and scope. This tool has shown that the concepts under which it was designed are valid for any company anywhere in the world.

The Balanced Scorecard is a powerful strategic management tool that serves to transform the organization’s strategy into real actions that can be measured and monitoring, as well as to help align all areas and activities based on corporate objectives and compliance of the strategy.

The implementation of the Balanced Scorecard in a company is not an easy and much less fast process. It is a continuous process in which you must be patient and persistent, direct and managers must have a high degree of commitment and effort. However, the whole long implementation process leaves great learning and from the beginning, significant advances and results are being achieved.

Bibliographic references

• Kaplan, r., & Norton, D. (2007) Use the Balanced Scorecard as a strategic management system Harvard Business Review Latin America
• Kaplan, r., & Reisen de Pinho, R. (2010) Volkswagen do Brazil: How to boost the strategy with the Harvard Business School control board
• SANCHEZ, J., Velez, m. & Araujo, P. (2015) Balanced Scorecard for Entrepreneurs: From the Canvas model to the Integral Command Table Faculty of Economic Sciences: Research and Reflection. Available at: http: // www.Redalyc.org/article.OA?ID = 90943602004