CorporateCoach eNewsletter

Issue No. 25, 8th September 2003

CONTENTS

  1. Editorial: Do you see what you expect to see?
  2. Tools notes: The Balanced Business Scorecard


1.     Editorial: Do you see what you expect to see? Richard Winfield

Richard Winfield

During my recent holiday I visited a series of caves. At one point, the guide prepared us to look down into a 20 metre deep cave. It would be very dramatic but we must take great care not to fall down. Gradually, we moved forward towards the parapet. and from a little way back we peered over. Indeed it was most impressive. Floodlit to show all the colours and shapes of the stone.

I am not a lover of heights and, as I peered over, my heart was a flutter.

The guide said that, to demonstrate how deep it was, she would drop a pebble. She threw the pebble – and the cave disappeared! As we recovered from the shock we noticed that what had seemed a cave was just a large lake. What's more, it was less than a metre deep. Whereas in a draught proof environment the water surface had been perfectly flat like a mirror, as soon as there were ripples the light from the cave above got broken up and the reflection was lost.

As I now moved forward right to the edge to look into the water I had absolutely no fear that I might fall over and get wet! What's more, I remembered that when I had first entered this part of the cave I had been surprised to see some water rippling in the distance and when I first looked into the great chasm I had wondered how it was that we had just walked through a tunnel which ought to have been where the new cave was.

But I saw what I had been conditioned to expect to see.

How often does our expectation of a situation cloud our judgement? How much fear and stress is based on what we convince ourselves might happen rather than what actually does happen?

This week I collected some printing from my supplier. They have been very helpful and I took the trouble to point out to them that the front door of the shop was filthy, which let down their otherwise excellent service. "Oh yes." replied the manager "It's because people put their hands on the glass. It was cleaned this morning." I am pretty sure that when I visited last year, the doorframe had been dirty then. So for a year or more the staff had been cleaning the glass daily without noticing that the handle and frame of the door they came through every morning was ingrained with grease.

We see what we expect to see. And if we see something every day, we probably don't see it at all.

It's almost enough justification to call in an external consultant. It is surprising what we are able to show our clients that was there for them to see all the time.

Following my comments about verbal and non-verbal messages in the last newsletter, Calum Coburn has kindly drawn my attention to an article that analyses Albert Mehrabian's research in more detail. The article is: The Myth of "Nonverbal Dominance" by Dr. C. E. "Buzz" Johnson.

USEFUL LINK:


SEASONAL PLUG:

Between now and the end of the year, many organisations will be reviewing their strategy and business plans, and preparing budgets for the next financial year.

Contact Brefi Group to learn how a facilitator can help you get far more value out of an awayday, corporate retreat or strategy meeting.


2.     Tools notes: The Balanced Business Scorecard

In the last ten years, two concepts have hit me with the WOW factor. These were the Balanced Business Scorecard and Robert Dilts' Neurological Levels model.

They are both ways of structuring a situation – and have each proved to be very useful tools.

I was fortunate that the balanced business scorecard was introduced in the very first issue of the Harvard Business Review that I ever subscribed to – and thus the one I read most thoroughly.

The scorecard was developed to overcome an imbalance in business planning. If you accept that what gets measured gets managed, then it is unfortunate if you only measure money.

The traditional means of measuring success through financial performance focuses on achievement to date. It is backward looking and can be counter productive in terms of securing a successful financial future. The business scorecard balances financial success with processes that will generate success in the future.

The scorecard retains a financial perspective and achieves 'balance' by introducing a customer perspective, an internal perspective and a learning and growth perspective. In addition, it introduces objectives and measures, identifying both critical success factors and critical measurements.

This creates a four column by three row matrix. You can download an example of the scorecard applied to Investors in People and a set of blank forms for your own use.

To summarise the model:

The four perspectives in the original paper are shown below. However, the model can be used with any selection of perspectives appropriate to a particular exercise.

Financial perspective

To succeed financially, how should we appear to our shareholders?

    Objectives
    Measures
    Targets
    Initiatives

Customer perspective

To achieve our vision, how should we appear to our customers?

    Objectives
    Measures
    Targets
    Initiatives

Internal business processes

To satisfy our shareholders and customers, what business processes must we excel at?

    Objectives
    Measures
    Targets
    Initiatives

Learning and growth

To achieve our vision, how will we sustain our ability to change and improve?

    Objectives
    Measures
    Targets
    Initiatives

The balanced business scorecard has been around for a few years now and in some organisations is seen as a flavour of the past. I believe that it remains a valuable and powerful tool.

I have found that it can be used in any order. The original intention was to set a strategy and then to complete the various questions for the different perspectives in order to create an appropriate monitoring system. However, it can be used in reverse for generating a vision/mission statement. By answering the individual questions for an organisation it is possible to identify its higher level purpose. "If all these things are true about our organisation, then what sort of organisation will it be?"

The authors of the original HBR paper have developed their ideas into a book. You may click here to buy Balanced Scorecard: Translating Strategy into Action by Robert S. Kaplan, Arthur Lowes, David P. Norton. Or visit our books site for more ideas and recommendations.

USEFUL LINKS:


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We hope you enjoyed this issue of CorporateCoach. If you would like to learn more about how we can work together, then please contact me, Richard Winfield