Purposeless BSC?

Posted: 14 November 2015 in Business Systems

“Purposeless?” Shock – my work has never been called that before. And after my presentation at the 2015 ICAEW Charity Conference, that is what one person said.  I was presenting the Balanced Scorecard to 60 in a packed seminar room.  I made it a lively affair and my focus was on getting sensible numbers together for their organisations and making sure that they had meaning in the first place.

Was my behavioural approach no more than a putting a nice face to a technical cul-de-sac.  First question up from the floor “all this activity you describe and measure – to what purpose is it?” Eh?  What is this one about?  The Balanced Scorecard is about keeping the charity focussed on it’s outcomes: homeless fed, prisoners visited, the dying given good ends, etc.  Not about impacts: reducing homelessness, reducing crime, curing cancer, etc.

Immediately after the seminar, another person asked me “do you know what the charity exists for and can you prove it does what it says it does.”  When questioned, he went on “When I asked several members of a senior management team, in front of their CEO, to say why their not-for-profit existed, they all gave difference answers. I cringed. And this was in a >£10 million income charity.”  Well it depends on what you mean by “different”.  There are vision statements and mission statements alongside a charitable objectives and the words just come out in different ways.  I replied I was surprised and that in my experience, all charitable managers and leaders know why their organisation exists. They know what impact it seeks – even they are often quite poor at measuring impact.

But I was stirred to think.  Maybe the Balanced Scorecard stops too short – that it should be extended .  Moving beyond measuring Outcomes to looking to Impact.  Or are we stretching the beast past what it is meant for?

So, BSC practitioners – what do you think?

Bill Lovett

p.s. see also Balanced Scorecard – why bother

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