Jun 29, 2010

Family Doctor and You

Recently I was filling the bio-data of my school going kid; the form had columns for filling the details of the family doctor. As you know, it is a good idea to have a family doctor, instead of visiting different doctors at different times. Since the doctor knows you closely, he can give better diagnosis. He is in your locality, you have better trust in him, procedures are simple and sometimes you take liberty to consult him over phone.

Occasionally you may have to go to speciality hospitals. Once I had to spend some time in Apollo Hospitals to attend a family member. Occasionally there I bumped into doctors who also ran clinics in my locality; these doctors spent part of their time as consultant-doctors with Apollo.

I liked the Apollo model very much; doctors running their own clinics could also work as consultants on their specialities in Apollo. The benefits for the doctors are many – they have a set of clients in their locality and are well respected. Their association to speciality hospitals adds to their reputation. They are able to network and collaborate with their peer experts and keep their knowledge up to date.

This model of working is beneficial to the clients too. Apollo doesn’t have to have all the specialist doctors on its rolls, thus keeping the cost/billing low. Once I got help from my family doctor, who was also a consultant there, to choose the best doctor in Apollo for a special treatment for my relative. Diagnosis and treatment of complex problems require expertise from multiple experts and in such cases a panel of doctors join together.

When we started C-Star Consortium in 2009, we modelled it like Apollo – many consultants having their own practices, joined together to form a consortium to offer several speciality business services. C-Star can address business problems related to revenue growth, profitability, employee retention, customer retention, product quality, information security, and accounting. In C-Star, you will find several consultants who spent decades enabling business transformation using methodologies & tools such as CMMI, People CMM, ERP, process-automation-tools, Six Sigma, Knowledge Management and Balanced Scorecard. You will also find great trainers and experts who can help you to achieve business critical, prestigious certifications.

In C-Star, we have several practitioner-turned consultants with diverse backgrounds and rich experience from reputed organizations (such as TCS, Wipro, CTS, CSC, Infosys, IBM, Oracle, KPMG). They can diagnose your business problems, put in place right solutions and help you through the implementation – and the pricing is made sweet for the Indian SMBs, through our innovative approaches in solution delivery and low overhead of operations.

More than ever, people want to do business with people, not with complex organizations. Trust and integrity are valued more than anything. The beauty of C-Star is that it is  simple, small, flexible, responsive, and offers greater customer intimacy, yet it has the strength and reliability coming from the power-network.

C-Star is more than a collaborative consulting services organization – it is a community of experts and CXOs. As a business owner or a CXO, a membership will benefit you to get access to the experts – includes some free services too.

Whatever may be your pain-point now, you can approach a C-Star consultant and be assured that you will get holistic solutions. You can tap into an expertise of 500+ person-years of experience.

So if you choose to have a family doctor for your kids, why not have a consultant from C-Star for your business? This consultant will be your local expert/mastermind and can act as a channel to the large pool of expertise that you can access whenever you want.

May 19, 2010

Entering into Consulting?

When I started my consulting business, some youngsters asked me how they can also become a consultant.

Considering the initial hiccups I went through, I didn’t encourage them to leave their secure and well paying job and start something of their own. I told them that they need to identify an area that they are very passionate about. Should have absolute clarity on why they want to do what they want to do. Enough savings to pull through several months or even years; ideally enough passive income to cover all their monthly expenses of the family. ..

What surprised me was, there are so many youngsters, who want to do something of their own and make a difference in this world; that’s good for our country.

Once in a discussion forum, I answered the question When does a Consultant starts flourishing in his/her business...!? as below:

With respect to an independent consultant, I feel the consultant will flourish, when the consultant is able to
  • Build trust with the client
  • Provide value for the fees charged
  • Build a brand for him.
The consultant needs to be in a ‘niche area’ for which there is a great demand. If this is not possible always, have some differentiation in a cluttered market. A consultant needs to have a lot of passion for the chosen field and an edge in it.

Several competencies are required for a consultant in addition to the domain knowledge. A good guideline is IMC USA's Management Consulting Competency Framework.

Some of the problems I experienced in my (independent) consulting practice in India:
  • There are no support systems that typically comes with a corporate job (admin etc)
  • In corporate, work comes to you; in consulting you have to hunt for work
  • Selling your services could be a tough job and it can consume a lot of time
  • Until you establish, the money you receive could be meager
  • Being solo, you may feel often lonely
  • Not much true consulting happening in terms of business problem solving; most consulting is around training and certification.
My thinking was on how to minimize the effects of being solo and still enjoy my professional freedom. One solution was to form a professional network of independent consultants. It was easy to locate a few people who had worked with me earlier. We formed a consortium under the name C-Star Consortium. Every month we met - shared info & experiences from the field and exchanged referrals; this gave a forum to have discussions that stimulated our mind. More independent consultants joined, each one making this group richer in collective intelligence and expertise. 

As the membership grew, people identified innovative ways of leveraging this network. It made sense to offer shared services to its members at low cost; some solution providers entered into partnership with the consortium. Offering sales services to the members in partnership with another marketing firm is another step being taken.

I have observed that several classes of problems that independent consultants facing today can be solved by connecting with the peers and collaborating.

If you are an independent consultant having a marketable service, expertise or information product that appeals to CXOs and Entrepreneurs, you could benefit by joining the C-Star community.

Apr 22, 2010

Dashboards as a Marketing Strategy

I know there are several organizations that build dashboards for their process improvement initiatives. Any change initiative such as ISO 9001, CMMI, or Balanced Scorecard requires support from the entire organization. Hence marketing the concepts, process and the benefits of the change initiative is essential to reduce resistance to change. Using dashboards to convey the progress can create tremendous interest and involvement from the entire organization.

You can use a dashboard not just for process improvements, but for any service you provide, to create a powerful impact.

What are the characteristics of a good dashboard?

Seth Godin, a marketing genius and author of several best sellers, has made the following observations on dashboards.
  1. If you can add a digital dashboard to your service, do it.
  2. If you can make the dashboard public, it gets more powerful.
  3. Highlight data that changes behavior.
  4. Allow the user to highlight the information that matters to them.

Apr 13, 2010

Develop Your Personal Scorecard

One positive outcome of the recession was several organizations gained inner strength by learning to be better at what they are. Growth without inner strength is dangerous. In my case, two things happened last year that made a huge impact. One was attending an NLP based program ‘Born-to-Win’ that helped me to blast off some of my mind-blocks. Another one was developing a Personal Scorecard for me.

Until last year, I had only new-year resolutions. That had some limited success. In 2009 beginning, I set the goals in a particular format. The format has been evolving for several months. Now it is a one page tabular format and I am calling it as my personal scorecard. It has the following headings:

Vision: What I want to be in the long-term? What I want to be known for?

Mission: What is my core purpose?

Objectives: What are my key objectives in the next few years?

Goals: What are my goals for this year?

Strategies (Key Activities): How am I going to achieve my goals?

Measures: Some simple measures of progress towards my goals that can be tracked monthly.

Both strategies and measures are classified under six categories:
  1. Business
  2. Finance
  3. Health
  4. Family
  5. Self-development
  6. Spiritual/Social
Then I have a list of key activities for the month and also a weekly plan for day-to-day tracking (outside the scorecard).

I have found immense value from this personal scorecard. Even though I am not able to complete all the tasks planned, I can see the definite progress that I am making against each of the goals. What matters is almost always getting done. Also I am not neglecting any area of my life and so it is balanced.

You can see a lot of similarities between the Personal Scorecard and the Balanced Scorecard. Instead of the four perspectives in Balanced Scorecard, I am using six perspectives. This approach of ‘six perspectives’ is pretty standard in personal goal setting, if you refer any self-development book.

Initially my personal scorecard was running to a few pages, now it is just one page, and it is really helping me to focus. My personal scorecard used to be an input to my daily affirmations/ meditation. Now-a-days it is an input once in a week. After a few months of its usage, I could find every activity I pick up is influenced by the scorecard. Every month-end I spend about half-an hour reviewing my scorecard which includes updating the monthly metrics and planning for the coming month. It is pretty exciting to watch the progress. Sometimes it creates pain when I don’t achieve the monthly targets, but it serves as an excellent energy booster. The scorecard has become a rich database of monthly info such as active & passive income, number of blog-articles published, books I read, new skills developed, and so on.

You could try developing your personal scorecard if you want to achieve your goals with certainty. There is so much material available in the internet on how to set ‘SMART’ goals. Please let me know if you find any difficulty in developing your personal scorecard.

Apr 7, 2010

The ‘secret’ behind the power of the Balanced Scorecard

Sometimes we wonder how large organizations with several lakhs/thousands of employees, manage their business and hold its employees together, when small organizations find it difficult to keep even a hundred employees together. After being associated with large organizations such as TCS and Flextronics for several years, and working closely with several mid-size organizations, I find the secret lies in ‘alignment’. There could be chaos at local level, but there is alignment at the overall level; alignment to the values, vision, key objectives, strategy, goals and so on.

How do they bring this alignment? They have established processes for their core business functions and there is a mechanism to measure business performance using proven framework such as Balanced Scorecard.

So many management concepts and fads came and gone in the last few decades, but Balanced Scorecard remains very relevant today and organizations are finding new ways of leveraging it and extending its capability. What makes Balanced Scorecard powerful and relevant even today? (Some aspects of this we have seen in the previous article.)

According to Paul Niven (Management Consultant and author), the tool’s longevity can be traced to its ability to solve several fundamental business issues facing all organizations today. In his article, he highlights the following issues organizations face today while measuring performance.

The Limitations of Financial Measures: Traditional focus on financial measures alone is not suitable for today’s environment. The chief criticism levied at financial measures is that they’re tantamount to driving a car by using only the rear-view mirror. You get a great view of where you’ve been, but little guidance towards where you’re headed. Balanced Scorecard gives a system that balances the historical accuracy and integrity of financial measures with the drivers of future financial success.

The Rise of Intangible Assets: In vast majority of modern organizations, what’s driving your success is not tangible assets, but intangible assets such as employee knowledge, databases full of rich information and culture of innovation that really drive value. Some recent estimates peg the value of intangibles as high as 75 percent of an organization’s true worth. Balanced Scorecard is a performance measurement system that sheds light on the value of intangibles and allows us to predict and drive future economic success.

The Challenge of Executing Strategy: Competition in any industry had significantly increased in the last few years. Hence it is vital to execute your strategy quickly. From an often quoted Fortune magazine study from 1999 found that 70 percent of CEO failures came not as a result of poor strategy, but the inability to execute. In this context, Balanced Scorecard has emerged as powerful strategy execution tool.

Balanced scorecard is centred on organization’s vision and strategy. Unlike traditional performance measurement systems that have financial controls at their core, the Balanced Scorecard begins with an organization’s vision and strategy. Then the vision and strategy are translated into performance measures that can be tracked and used to gauge the success in the successful implementation of vision and strategy.

In the same article, Paul Niven gives an example on how companies use Balanced Scorecard for resource allocation and for controlling expenditure in alignment with the business strategy.

To appreciate the beauty of the Balanced Scorecard, one should look at ‘The Building Blocks of the Balanced Scorecard’ and understand how it supports the core elements of business management - strategy, planning, measurement and reporting.

One notable feature of the Balanced Scorecard is ‘Cascading’, which is very effective in bringing in organizational alignment. Cascading refers to a process of developing Balanced Scorecards at lower levels of your business. It is about translating the corporate-wide scorecard down to first business units, support units or departments and then teams or individuals. These scorecards must align with the organization’s highest level Scorecard. This eliminates issues such as 1) employee actually running counter to the organization’s goals because they have a different understanding of what you are trying to accomplish 2) various departments in your organization focus on activities within their own silo more than on how they support the organization’s mission and vision.

Thus the differentiating features such as focus on strategy and employee alignment around a few key goals make the Balanced Scorecard a very effective performance management tool for modern organizations to achieve breakthrough financial results.

Mar 31, 2010

How to leverage scorecard in business?

To effectively use scorecards in our business, we could look at how it works in other areas of our life.

As you know, scorecard is a simple tool for measuring performance and giving feedback. For example, a school progress report shows performance against maximum marks; it also shows trends. It provides student, teacher and parent an overall idea about the performance and it prompts them to take any corrective action.

Take the case of scorecard for a game. It excites and energizes the players as well as the audience.

Let us explore some of the attributes of a scorecard that can bring certain powers to you.

The Power of Focus: As you know, focus gives intensity. A 40W bulb is just sufficient to illuminate a small room, but when the beam is focused, it can illuminate objects several hundred meters away. If you have taken a ride in ECR road from Chennai in night, you would have experienced this: you can see the road illuminated kilometers in front of you, reflecting the beam of your car headlamp.

Something similar happens with scorecard when we measure performance against the goal that is important to us. We may do hundreds of activities, but scorecard brings focus to a few critical measures and keeps our mind focused on the targets and the critical things to do.

We are aware of the 80/20 rule or the Pareto principle. By this rule you will find that 20% of your activities will account for 80% of your results. By having key action items (or strategic initiatives) against your goals, the scorecard can help you to get focused on those ‘vital few’ activities that will account for most of your results.

The Power of Leverage: When you leverage, you give a small input and generate a large force or output; for example with the fulcrum of a lever, you can magnify the force. Or with a small signal input at the base of a transistor, you can control a large power flow. You would have found that when you give feedback to your team with a measure or scorecard as a basis, your influence is far more than otherwise.

The Power of Alignment: Several interesting phenomenon we can observe, when things are aligned. When ions are aligned, we get superconductivity and it can produce extraordinarily strong magnetic field. When light waves are ‘aligned’, we get Laser. Think of the magnificent opera, where several artists play their role in alignment; or a symphony orchestra, where thousands of musicians play their instruments in harmony. Another example is the Olympic opening/closing ceremonies where the participants perform in unison.

A popular event in Kerala is ‘Snake Boat Race’. It is amazing to watch the rhythm, the coordinated hand movements of about hundred oarsmen and the synchronized chanting of singers. Great excitement is generated when people align to a common goal (video of a boat race).

He whose ranks are united in purpose will be victorious.” – Sun Tzu, ancient military strategist.

Scorecard when reviewed by all stakeholders has a huge influence on team/business alignment.

The Power of a Written Goal: There is something magical about writing things down. It has been found that people commit themselves to their goals when it is recorded. Scorecard is a place where you have your goals in writing.

The Power of Feedback: Our perceptions can sometimes be biased by recent events and decisions based on perceptions can go wrong. Scorecard showing trends eliminates this bias and can give new insights that can lead to better decisions.

The Power of Dashboards: We know what a dashboard means to a car or a cockpit to a plane. I am sure you will not embark on a long journey in a car that is not having a dashboard.

Once you automate your business scorecard and incorporate the features of dashboards such as status, alerts, drill downs, you get a powerful environment to manage your business.

The Power of Filtering: One problem that happened with business process automation or ERP implementation is that there are hundreds of reports available to track. We are bombarded with mountains of information every day, thanks to the advancement in technology and communication. However, our natural capacity to process info remains more or less the same. So we need effective filtering mechanisms for the information deluge. Scorecard/dashboard can act as a great tool that can filter info and alert you for taking action.

By understanding the attributes of a scorecard we will be able to leverage it better in our business. Scorecard is a simple and powerful tool that you can use to provide feedback, to focus, to align, to leverage, to communicate, to motivate, to inspire, to manage, to improve, to engage and to ensure certainty of success in business.

Mar 16, 2010

Building Blocks of the Balanced Scorecard

The Balanced Scorecard (BSC) concept was created by Doctors Robert Kaplan and David Norton in 1992, and has been implemented by thousands of corporations, non-profit organizations, and government agencies worldwide. The Balanced Scorecard is a framework that describes and measures the strategy of an organization across four perspectives: financial, customer, internal processes and learning and growth. It has grown from a measurement system (that reports on past operating performance and the drivers of future performance) to powerful communication tool and to transformative strategic management system.

The Building Blocks of the Balanced Scorecard are:

Vision: A concise statement that defines the mid- to long-term (three to ten year) goals of the organization. The vision should be external and market-oriented and should express how the organization wants to be perceived by the world.

Mission: A concise internally focussed statement of the reason for the organization’s existence, the basic purpose toward which its activities are directed, and the values that guide employee’s activities. The mission should also describe how the organization expects to compete and deliver value to the customers.

Strategy: Strategy is about selecting the set of activities in which organization will excel to create a sustainable difference in the market place. The sustainable difference can be to deliver greater value to the customers than competitors, or to provide comparable value but at lower cost than competitors.

Perspectives: The basic premise behind the Balanced Scorecard is that Financial measures are important, but they must be supplemented with other indicators that predict future financial success. The Balanced Scorecard suggests that we view the organization from four perspectives, and develop metrics, collect data and analyze it relative to each of these perspectives. The four perspectives are: financial, customer, internal processes and learning and growth. The key questions asked in each of these perspectives are:

  • Financial: To succeed financially, how should we appear to our shareholders?
  • Customer: To achieve our vision, how should we appear to our customers?
  • Internal Business Process: To satisfy our shareholders and customers, what business processes must we excel at?
  • Learning and Growth: To achieve our vision, how will we sustain our ability to change and improve?
Key Objectives: At the center of the Balanced Scorecard framework is “vision” and “strategy.” The articulated vision and strategy are translated in to performance objectives and measures that can be tracked and used for the successful implementation of vision and strategy. We will arrive at strategic objectives under each of the perspectives by asking several questions and brain-storming. For example, under Customer perspective, we may ask questions such as “Who are our target customers?”, “What is our value proposition in serving them?”.

Measures: Key Performance Indicators (KPIs) are identified for each strategic objective. KPI is a measure of performance and measures progress toward organizational long-term goals. A Balanced Scorecard will contain a mix of KPIs and its associated lead indicators (also called performance drivers). These measures are not isolated; every measure selected should be an element in a chain of cause-and-effect relationships that communicates the strategy to the organization.

Targets: Targets for the measures identified. These are normally stretch targets that will allow breakthrough performance.

Initiatives: These are strategic initiatives identified to close the gap between the targets set and the current performance.

Strategy Map: A one-page graphical representation of what you must do well to execute your strategy. It is done in a plain and simple manner that is easily understood by every employee from top to bottom. It is a powerful communication tool to convey to all stakeholders what the organization is attempting to accomplish in a simple, coherent package (sample).

Scorecard/Dashboard: Scorecard gives performance measurement against targets and the measures are developed using a methodology such as Balanced Scorecard. Dashboard is normally an IT application that displays process measures and is rich in visual displays. A general dashboard need not display measures always against a target. It can have drill downs to analytical reports. There are several applications such as the one from Corporater that can be used to implement Balanced Scorecard System (a sample dashboard screen-shot from Corporater).

What makes the Balanced Scorecard so powerful? Let us explore this next week.

For more info on the Balanced Scorecard, refer Resources in CXO Dashboards. For regular updates on business performance measurement, please subscribe CXO Insights.