Elsa [email protected]
Sogrupo-SI – Caixa Geral de Depósitos Group
The Balanced Scorecard and Decision
Support System – Case Study
1
• The Decision Support System Enterprise Solution
• Lessons Learned
• Context
• Corporative BSC Implementation & BSC Deployment
• Pilot Demonstration
AGENDAAGENDA
• Questions & Answers
• Achieved Results
2
• The Decision Support System Enterprise Solution
• Lessons Learned
• Context
• Corporative BSC Implementation & BSC Deployment
• Pilot Demonstration
AGENDAAGENDA
• Questions & Answers
• Achieved Results
3
! The Case Study is to be presented based on the development of a Decision Support System within the Shared Services Unit of Information Systems
Main characteristics of Sogrupo-SI:
! It serves the major Portuguese bank group
! One year of activity
! It results from the merger of several IS companies
! It has about 400 collaborators
! It presents 4 essential business areas:
- Projects
- Maintenance
- Exploitation
- Customer Services
Main characteristics of Sogrupo-SI:
! It serves the major Portuguese bank group
! One year of activity
! It results from the merger of several IS companies
! It has about 400 collaborators
! It presents 4 essential business areas:
- Projects
- Maintenance
- Exploitation
- Customer Services
CONTEXTCONTEXT
4
! By creating Sogrupo-SI, the CGD Group had the purpose of developing a set of initiatives with the objective of endowing the new organisation with quality, innovation and efficiency
Decision to Create Sogrupo-SI
Decision to Create Sogrupo-SI
Omega ProjectOmega Project Transformation of Sogrupo-SI ProjectTransformation of Sogrupo-SI Project
Organisation
ERP
Project Management
Change Management
Decision Support System (DSS)
People
Support
! Provide better quality service
! Increase efficiency within the organisation
! Promotion of group synergies
! Provide capacity to propose innovative solutions
Initiatives Objectives
CONTEXTCONTEXT
5
! The objectives of the Decision Support System were established aligned with the organisation’s objectives
Main objectives of the project :
! To endow Sogrupo-SI with an instrument which allows the follow up business evolution
! To use the DSS as a main information management tool of Sogrupo-SI
! To align the individual objectives with global strategy
! To supply an integrated and automated decision support solution with the operational systems
! To develop the Cost System as a management tool, with updated information and a high level of detail that allows:
" Manage/monitor at an operational level, in compliance with the strategic objectives based on business drivers
" Manage budgets and invoicing of the services provided to clients
Main objectives of the project :
! To endow Sogrupo-SI with an instrument which allows the follow up business evolution
! To use the DSS as a main information management tool of Sogrupo-SI
! To align the individual objectives with global strategy
! To supply an integrated and automated decision support solution with the operational systems
! To develop the Cost System as a management tool, with updated information and a high level of detail that allows:
" Manage/monitor at an operational level, in compliance with the strategic objectives based on business drivers
" Manage budgets and invoicing of the services provided to clients
CONTEXTCONTEXT
6
• The Decision Support System Enterprise solution
• Lessons Learned
• Context
• Corporative BSC Implementation & BSC Deployment
• Pilot demonstration
AGENDAAGENDA
• Questions and answers
• Achieved results
7
! The information flows reflect the interdependencies between different components
Business Strategy
Balanced Scorecard(BSC)
Balanced Scorecard(BSC)
Information IntegrationInformation Integration
• Mission and Vision
• Themes and Strategic objectives
CostSystemCost
System
• Service provided Cost • Projects Cost
Definition ofSLA
Definition ofSLA
• Performance Measures
• Targets / Goals
• Comparative information of Measures
Operational Systems Artemis External InformationOrdersManagement
• Operational information on costs, investments,... • # hours • # orders
ProblemsManagement
• # interventions
THE DECISION SUPPORT SYSTEM THE DECISION SUPPORT SYSTEM ENTERPRISE SOLUTIONENTERPRISE SOLUTION
8
CorporativeCorporativeBSCBSC
ImplementationImplementation
Targets/Goals
Initiatives
Selection of Support
Application
Measures Assessment
AnalysisPerspectives
Strategic Objectives
and Strategic map
Success Critical Factors
Performance Measures
(KPI)
ConceptionConception
Business Environment
Mission
Vision
Scorecard Scope
Strategic Themes
PilotPilotDesignDesign
PilotPlanning
DevelopmentDevelopment BSCBSCDeploymentDeployment
Exploitation
CustomerServices
Projects
Maintenance
Support
Preparation of Preparation of ImplementationImplementation
CoCo--ordination ordination Mechanisms and Mechanisms and
Management ModelManagement Model
Implementation of Implementation of Corporative BSC Corporative BSC
software toolsoftware tool
Deployment PlanDeployment Plan
! The Balanced Scorecard Project approach:
THE DECISION SUPPORT SYSTEM THE DECISION SUPPORT SYSTEM ENTERPRISE SOLUTIONENTERPRISE SOLUTION
9
! The top-down approach proposed by the Balanced Scorecard starts by documenting the main strategic dilemmas/themes:
THE BSC PROJECT APPROACHTHE BSC PROJECT APPROACH--CONCEPTIONCONCEPTION
10
! In the Conception phase, actions were developed according to the main critical points identified:
Developed actionsDeveloped actions
! The Mission was not defined (Main reason for the organisation existence)
! There was no Global Vision (how the company should be positioned at medium and long term)
Critical pointsCritical points! Workshops to define Mission, Vision and
Strategic Objectives
! Communication actions of Mission, Vision and Strategic Objectives to the entire organisation
! Study about the main trends in the ISOutsourcing market
THE BSC PROJECT APPROACHTHE BSC PROJECT APPROACH--CONCEPTIONCONCEPTION
11
! The Strategy Map reflects a graphic view of the organisation strategy in terms of strategic objectives and cause-effect relationships between
Optimisation of the financial performanceMaximisation of the value proposal
QualityRelationship PriceTime
Alignment with CGD GroupAlignment with CGD Group
Cost Resources
Motivated and prepared collaborators
CultureReorientation
of competencies Formation
Efficiency and effectiveness of processes
Projects Maintenance Exploitation Customer Services
SupportProcesses
TechnologicalSupporting
infrastructure
Client Financial
Processes
Learn & Growth
+ + + +
+ + +
Methodologies and tools
“Cost-benefit”Analysis
Previousdevelopments
Outsourcingutilisation
Systemsin production
Clients formation
Knowledge about client + business + IS+ + + ++ +Quality
control +
THE BSC PROJECT APPROACHTHE BSC PROJECT APPROACH--DESIGNDESIGN
12
! In this Design phase, a set of the measures and the critical success factors of the strategic objectives were identified:
Critical Success Factors
Deliver according to specifications
Response in time according to the established
Client oriented collaborators
Systems availability
Productivity of the collaborators
Processes optimisation
Client Financial Processes Learn &Growth
Strategic Objectives
x xx x
x x x
x x
x x x
x x
Illustrative
THE BSC PROJECT APPROACHTHE BSC PROJECT APPROACH--DESIGNDESIGN
13
! The measures proposed by the Balanced Scorecard were obtained according to several selection criteria
Set of measures susceptible to utilisationSet of measures susceptible to utilisation
Priority and filtering MeasuresPriority and filtering Measures
Initial proposal of MeasuresInitial proposal of Measures
Measures proposal for WorkshopMeasures proposal for Workshop
Proposal discussion with Top Management
Proposal discussion with Top Management
Measures ValidationMeasures Validation
Measures SelectedMeasures Selected
Initial collection of business Measures
Initial collection of business Measures Relevance for BusinessRelevance for Business
Intervention CapacityIntervention Capacity
+
Strategy
Information AvailabilityInformation Availability
Measures IndependenceMeasures Independence
+
+
Mission
Vision
Critical Success Factors
Strategic Objectives
Measures Selection Criteria
THE BSC PROJECT APPROACHTHE BSC PROJECT APPROACH--DESIGNDESIGN
14
! During the Design phase, actions were developed according to the main critical points identified
Actions Developed Actions Developed
! Strategic objectives where not aligned to the organisation Mission and Vision
! Lack of knowledge about critical success factors that influence strategic objectives
! Difficulty in identifying which measures are essential to monitor the organisation performance
Critical PointsCritical Points
! Identification / alignment of strategic objectives and establishment of cause-effect relationships (strategic map) as well as the relative success critical factors
! Achieving the business critical measures filtered according to an iterative process
! Realisation of workshops to obtain agreement about the Balanced Scorecard design
THE BSC PROJECT APPROACHTHE BSC PROJECT APPROACH--DESIGNDESIGN
15
! The definition of Targets and Initiatives permits to drive the organisation towards objectives materialisation
• Client fidelity
• Operational result
• % of resources use
• % of average permanence in each level
• About 50% annual increase;
• 20% annual increase;
• Year 1, 60%; year 2, 65%; year 3, 70%;
• Year 1, 50%; year 2; 75%year 3, 90%;
• CRM implementation
• Definition of management plans
• Resource control implementation
• Formation programmes
Strategic ObjectivesStrategic Objectives MeasuresMeasures TargetsTargets InitiativesInitiatives
Profitability
Revenues growth
Financial
Client
Service quality
Supply capacity
Processes
Processes management
Resources management
Learning & Growth
Motivation Workers competencies
Illustrative
THE BSC PROJECT APPROACHTHE BSC PROJECT APPROACH--DEVELOPMENTDEVELOPMENT
16
Actions Developed Actions Developed
! There were no support systems susceptible to feed the BSC Measures
! The strategic objectives of the organisationwere not adjusted although there was a set of established initiatives
! The software solutions existent in the market for Balanced Scorecard are in an intermediate maturity phase
Critical PointsCritical Points
! Achieving the actual values of the measures, when its necessary using estimates
! Identification/evaluation of impact of each initiative on strategic objectives by means of inquiries on various organisational levels
! Evaluation and selection of software solutions which are leaders in the market
! In the Development phase, actions were developed according to the main critical points identified
THE BSC PROJECT APPROACHTHE BSC PROJECT APPROACH--DEVELOPMENTDEVELOPMENT
17
• The Decision Support System Enterprise solution
• Lessons Learned
• Context
• Corporative BSC Implementation & BSC Deployment
• Pilot demonstration
AGENDAAGENDA
• Questions and answers
• Achieved results
18
PilotPilotCorporativeCorporative
BSCBSCImplementationImplementation
Initiatives
Selection of Support
Application
Measures Assessment
DefinitionPerspectives
Strategic Objectives
and Strategic map
Success Critical Factors
ConceptionConception
Business Environment
Mission
Vision
Scorecard Scope
Strategic Themes
DesignDesign
PilotPlanning
DevelopmentDevelopment BSCBSCDeploymentDeployment
Exploitation
CustomerServices
Projects
Maintenance
Support
Preparation of Preparation of ImplementationImplementation
CoCo--ordination ordination Mechanisms and Mechanisms and
Management ModelManagement Model
Implementation of Implementation of Corporative BSC Corporative BSC
software toolsoftware tool
Deployment PlanDeployment Plan
! The Balanced Scorecard Project approach:
PILOT DEMONSTRATIONPILOT DEMONSTRATION
Targets/Goals
Performance Measures
(KPI)
19
Balanced ScorecardBalanced Scorecard
Analytical Information Systems
(ex.: Activity Based Costing System)
Analytical Information Systems
(ex.: Activity Based Costing System)
Access to Information
Operational Systems
Data Warehouse
AccountingAccounting Human Resources
Human Resources LogisticLogistic
Pilot EnvironmentIllustrative
PILOT DEMONSTRATIONPILOT DEMONSTRATION
1/6
25
• The Decision Support System Enterprise solution
• Lessons Learned
• Context
• Corporative BSC Implementation & BSC Deployment
• Pilot demonstration
AGENDAAGENDA
• Questions and answers
• Achieved results
26
PilotPilotCorporativeCorporative
BSCBSCImplementationImplementation
Initiatives
Selection of Support
Application
Measures Assessment
DefinitionPerspectives
Strategic Objectives
and Strategic map
Success Critical Factors
ConceptionConception
Business Environment
Mission
Vision
Scorecard Scope
Strategic Themes
DesignDesign
PilotPlanning
DevelopmentDevelopment BSCBSCDeploymentDeployment
Exploitation
CustomerServices
Projects
Maintenance
Support
Preparation of Preparation of ImplementationImplementation
CoCo--ordination ordination Mechanisms and Mechanisms and
Management ModelManagement Model
Implementation of Implementation of Corporative BSC Corporative BSC
software toolsoftware tool
Deployment PlanDeployment Plan
! The Balanced Scorecard Project approach:
Corporative BSC Implementation & Corporative BSC Implementation & BSC DeploymentBSC Deployment
Targets/Goals
Performance Measures
(KPI)
27
! Corporate BSC Implementation and Deployment through Sogrupo-SI areas
Corporative BSC Implementation & Corporative BSC Implementation & BSC DeploymentBSC Deployment
02 - 2002 07 - 200203 - 2002 05 - 200204 - 2002
Corporative BSC Implementation Corporative BSC Implementation Corporative BSC Implementation
BSC DeploymentBSC DeploymentBSC Deployment
06 - 2002
ProjectsProjectsProjects
MaintenanceMaintenanceMaintenance
ExploitationExploitationExploitation
Customer Services
Customer Customer ServicesServices
SupportSupportSupport
Illustrative
28
MissionMissionMission
VisionVisionVision
ValuesValuesValues
Core CompetencesCore CompetencesCore Competences
Strategic ThemesStrategic ThemesStrategic Themes
Strategic ObjectivesStrategic ObjectivesStrategic Objectives
MeasuresMeasuresMeasures
Strategic TargetsStrategic TargetsStrategic Targets
Strategic projects / InitiativesStrategic projects / InitiativesStrategic projects / Initiatives
Monitoring & EvaluationMonitoring & EvaluationMonitoring & Evaluation
! The Strategic Challenge ... Why do we exist?. What do we offer to the society?...
... How are we going to do it?…
... What behavioral patterns should guide our people’s actions?…... What core competences
will guarantee our competitive advantage?...
... What big themes will guide the company action for the coming years? ...
...What specific objectives define this strategic themes?...
...How are we going to measure the
achievement of our objectives?...
...What specific targets do we want to attain for each measure?...
...What actions are we going implement in order to achieve the
strategic objectives?...
In which way are we going to monitor the performance of each measure in order to
evaluate whether we are reaching our targets or not?...
Corporative BSC ImplementationCorporative BSC Implementation
29
!! Client OrientedClient Oriented!! Objectives OrientedObjectives Oriented!! ProductivityProductivity!! InnovationInnovation
!! Client PartnershipClient Partnership!! Ethic & ProfessionalismEthic & Professionalism!! Interpersonal RelationshipsInterpersonal Relationships!! Results OrientedResults Oriented
SOGRUPOSOGRUPO--SISI COLLABORATORSCOLLABORATORS
VALUES COMPANYVALUES COMPANY
! Development a culture and a set of core competences associated with the Strategy..
!! Quality ManagementQuality Management!! Change ManagementChange Management!! Knowledge ManagementKnowledge Management
SOGRUPOSOGRUPO--SISI
CORE COMPETENCESCORE COMPETENCES
!! Human Resources ManagementHuman Resources Management!! Project ManagementProject Management!! Technology Knowledge ManagementTechnology Knowledge Management
Corporative BSC ImplementationCorporative BSC ImplementationIllustrative
30
! From the pilot to the Implementation …
MEASURES
INCLUDED IN
THE PILOTMEASURES
MEASURES
INCLUDED IN
INCLUDED IN
THE PILOT
THE PILOT MEASURES ADAPTED
TO THE NEW STRATEGY
MAPMEASURES ADAPTED
MEASURES ADAPTED
TO THE NEW STRATEGY
TO THE NEW STRATEGY
MAPMAP
Corporative BSC ImplementationCorporative BSC Implementation
31
Infr
a In
fra
Estr
utur
asEs
trut
uras
Maximize the Value of the IS for CGD GroupMaximize the Value of Maximize the Value of the IS for CGD Groupthe IS for CGD Group
Be the strategic IS Partner
Proc
esse
sPr
oces
ses
Valu
eVa
lue Facilitate the
Evolution of the businessFacilitate the
Evolution of the business
Deliver services within the establish Quality Service agreements
Deliver services within the establish Quality Service agreements
Deliver services ata Competitive PriceDeliver services ata Competitive Price
Dynamize the timeto client in order to respect
the delivery time
Dynamize the timeto client in order to respect
the delivery timeClie
ntC
lient Foster the
Relationships withthe clients
Foster theRelationships with
the clients
Optimize theoutsourcing services
Optimize theoutsourcing services
Organizational and human capital development
Be the reference in Operative Excellency in the delivery of services
Foster the use of methodologies & support systems
Foster the use of methodologies & support systems
Develop IS & ITState of the Art
Knowledge
Develop IS & ITState of the Art
KnowledgeCreate awareness of
The SSI ImageCreate awareness of
The SSI Image
Optimize and rationalizethe Business Processes
(Project, Maintenance development, ...)
Optimize and rationalizethe Business Processes
(Project, Maintenance development, ...)
Satisfy the IS necessitiesin an efficient way
Satisfy the IS necessitiesin an efficient way
Contribute toImprove the performance
Contribute toImprove the performance
Integrate andStandardize the IS
of CGD Group
Integrate andStandardize the IS
of CGD Group
Allocate resourcesAccording to the Objectives
and core competences
Allocate resourcesAccording to the Objectives
and core competences
Foster a HR Infrastructureassociated with the strategyFoster a HR Infrastructure
associated with the strategy
QualityManagement
QualityManagement
Lear
n &
Le
arn
&
Gro
wth
Gro
wth
Corporative BSC ImplementationCorporative BSC ImplementationIllustrative
Support the SSI Business withThe adequate IS & IT
Support the SSI Business withThe adequate IS & IT
32
! The involvement of the people during the Corporative BSC implementation process
...How are we going to measure the fulfillment of the objectives?...
...How are we going to measure the fulfillment of the objectives?...
Set the level of the stress we want to put into the organization and
the people in it, identifying what is considered an achievement
How we are going to measure if we succeed
in achieving the strategic Targets / Goals
Key Programs and projects needed in order to achieve the strategic objectives and targets /
Goals
Translate the company mission into a set of tangible objectives that
differentiate which are the key focus points for the people of the organization from the rest
! Jean Pierre Martin! Definition and automatizationof the clients information needs
! 5 Demands per Client per month
! < 0.4
! # Ad Hoc Information demands
! % Hours spent in gathering the information needed
! Ensure the information readiness
ResponsibleInitiativesTargetsMeasuresObjectives
Identifies who is going to be responsible for which objective/s setting the accountability of the
targets and goals
Corporative BSC ImplementationCorporative BSC Implementation
33
! The deployment scenario…
Sogrupo-SIReporting
Maintenance
Measures, Targets,Initiatives and Responsibles
CGD Group
ExploitationProjects CustomerServices
Support
Process A Process B Process …
BSC DeploymentBSC DeploymentB
SC
Dep
loym
en
t
34
• The Decision Support System Enterprise Solution
• Lessons Learned
• Context
• Corporative BSC Implementation & BSC Deployment
• Pilot Demonstration
AGENDAAGENDA
• Questions & Answers
• Achieved Results
35
! Design and divulgation of Mission, Vision and Strategic Objectives of Organisation;! Establishment of a common management language:
" Facilitating the organisational change inherent to the Organisation creation;
" Facilitating the dialogue between various business areas/perspectives;! A versatile team of people who understand their contribution to the business
strategy;! The Balanced Scorecard has shown a strong potential as a model for a flexible
strategic management allowing the alignment of the whole organisation around the strategy in a fast and precise way by: " Guaranteeing a Comprehensive Vision of the Strategy of the Organisation." Integrating the main objectives of the various areas and helping brake
departmental barriers." Facilitating the strategic monitoring of challenges (strategic feedback).
! Demonstration of a Decision Support System value through the construction of a Pilot;
ACHIEVED RESULTS ACHIEVED RESULTS
36
! User friendly web interface, promoting the Balanced Scorecard as a communication tool
! Documenting and divulging the organisation strategy
! Visualising the cause-effect relationships between strategic objectives and the measures that support them
! Fast construction of a pilot to demonstrate the benefits of the Balanced Scorecard approach
! The standard usage of the Balanced Scorecard Methodology by the organization
ACHIEVED RESULTS ACHIEVED RESULTS
! Advantages in using SAS STRATEGIC PERFORMANCE MANAGEMENT
37
• The Decision Support System Enterprise Solution
• Lessons Learned
• Context
• Corporative BSC Implementation & BSC Deployment
• Pilot Demonstration
AGENDAAGENDA
• Questions & Answers
• Achieved Results
38
! It is important to ensure that the project leadership is at the higher level of the organization.
! Obtain the management team agreement on each phase of the project with the workshops.
! Management tools are not enough to make the change effective: it is necessary to involve all the collaborators in the whole process.
! The Change Management project, developed at the same time, generated synergies and contributed to the success of this project.
! Manage the communication process of the project to all the collectives involved.! Rapid development of a proof of concept version which allows the demonstration of
the advantages of the solution adopted.! It is necessary to recognize that the Decision Support Systems does not make
decisions: it gives information to be used in making decisions.! The optimal is an enemy of the good.
LESSONS LEARNEDLESSONS LEARNED
39
• The Decision Support System Enterprise Solution
• Lessons Learned
• Context
• Corporative BSC Implementation & BSC Deployment
• Pilot Demonstration
AGENDAAGENDA
• Questions & Answers
• Achieved Results