OVERCOMING HINDRANCES TO STRATEGY EXECUTION USING THE BSCEP

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Test and adapt

The fundamental strategic assumptions should be tested to determine if indeed the organisation has the right strategy. This involves testing and adapting the strategy, using internal operational data and new external environmental and competitive data (Kaplan & Norton, 2008b). Many strategy execution processes, including the BSCEP process, have been designed to enhance strategy execution. The strategy execution gap, however, is still real. The BSCEP created by Robert Kaplan and David Norton (Kaplan & Norton, 2008b) claims to address this.
Some authors have commented on the standard BSC as critics or admirers of the framework. However, few authors have provided an account of practical experience in using the BSCEP, and the lack of literature or comments about the role of the BSCEP in strategy execution has been noted. Kaplan (2012) opines that little research, if any, has been conducted on the role of the BSC in strategy execution (BSCEP). This has motivated the current study, which concerns itself with the practical and lived experience of the BSCEP, which is a six-stage strategy execution process (Kaplan & Norton, 2008b).
Lack of literature on the BSCEP has not deterred the researcher from undertaking this research. The principal investigation in this research is the BSCEP, where the objective is to contribute to the body of knowledge and the literature by reporting on the practical experience of using the BSCEP for strategy execution. The findings provide strategy practitioners, company CEOs and academics with an understanding of challenges encountered when translating the BSCEP framework, as a theoretical concept, into action.
The balanced scorecard (BSC) was created by Professor Robert Kaplan and Dr David Norton in 1992 (Kaplan & Norton, 1992). It sought to balance financial and non-financial performance indicators, hence the name “balanced scorecard”. The creators of the BSC conducted a year-long research project involving 12 large companies. The original idea behind the study was to find a solution to challenges emanating from short-term decision-making, based on using only financial accounting measures. This led to over-investment in easily valued assets (through mergers and acquisitions), with readily measurable returns, and under-investment in intangible assets, such as product and process innovation, employee skills, and customer satisfaction (Kaplan & Norton, 1992). Kaplan and Norton (1992) then explored the use of performance measurements by these companies to control the behaviour of managers and employees.
They used their findings to devise a new performance measurement system that would provide businesses with a balanced view of financial and operational measures, namely, the BSC. The BSC has since become a controversial topic at management conferences around the world. As the BSC was created to address performance systems that relied exclusively on financial performance metrics, rewarding performance based on these systems was perceived as promoting short-term decision-making at the expense of long-term profitability (Kaplan & Norton, 1996a; Niven, 2006b). As the BSC evolved from 1992 it introduced a strategic element (Albright, Burgess & Davis, 2011; Lingle & Schiemann, 1996).
The BSC evolved from being just a performance measurement tool in a strategic management process which entails strategy formulation, execution and monitoring. The strategy component was not present when the BSC was created in 1992. The focus was more on performance management. Since 1992 the BSC has evolved from its early use as a simple performance measurement framework (Kaplan & Norton, 1996a; 2001c; 2004b; 2006; 2008b), to a full strategic planning and management system (Kaplan & Norton, 1996a; 1996b; 2001a; 2001b; 2004a; 2006; 2008a). The BSC strategy execution methodology, also known as the execution premium (BSCEP) on which this research is focused, is a complex conceptual framework that has not yet received critical attention from corporate practitioners and academics, since it was unveiled by Kaplan and Norton in 2008.
The BSC has enhanced two fundamental business issues, namely: the problem of effective organisational performance measurement and the critical issue of successful strategy implementation (Niven, 2002). The BSCEP is a framework that helps organisations translate a company’s vision and strategy into a coherent set of performance measures (Kaplan & Norton, 2008b). The success of strategy execution is a critical issue across organisations. The BSCEP claims to address this, but there are hindrances to successful strategy execution using the BSCEP as an implementation tool. In the current (2016) business environment, strategy execution has never been more important, and yet research shows that most companies fail to execute strategy (Charan & Colvin, 1999; Tait & Nienaber, 2010). The quality of the strategy is important as well as the ability to execute it (Kaplan & Norton, 2001a).

TABLE OF CONTENTS :

• ABSTRACT
• ACKNOWLEDGEMENTS
• TABLE OF CONTENTS
• LIST OF FIGURES
• LIST OF TABLES
• ABBREVIATIONS, ACRONYMS AND GLOSSARY
• SYNOPSIS OF THE STUDY
• CHAPTER 1: INTRODUCTION
  • 1.1. INTRODUCTION AND BACKGROUND
  • 1.2. PROBLEM STATEMENT
  • 1.3. RESEARCH OBJECTIVES
  • 1.4. RESEARCH QUESTIONS
  • 1.5. RESEARCH PROCESS
  • 1.6. IMPORTANCE AND BENEFITS OF THE PROPOSED STUDY
  • 1.7. DELIMITATIONS
  • 1.8. ASSUMPTIONS
  • 1.9. DEFINITION OF KEY TERMS
  • 1.10.REFERENCING TECHNIQUE
• CHAPTER 2: LITERATURE REVIEW – HISTORY AND STATUS OF THE BSC
  • 2.1. INTRODUCTION
  • 2.2. GENERATIONS OF THE BSC
  • 2.3. EVOLUTION OF THE BSC SINCE
    • 2.3.1. BSC concept inception and the BSC perspectives –
    • 2.3.2. The BSC introduced the strategy component –
    • 2.3.3. The BSC as an instrument for a single strategy –
    • 2.3.4. The BSC as a translator of strategy into action (2001 – 2004)
    • 2.3.5. The focus on the BSC strategy map –
    • 2.3.6. The BSC as a creator of corporate synergies –
    • 2.3.7. The inception of the BSC execution premium (BSCEP) –
• • 2.4. RELEVANCE OF THE BSC IN RELATION TO STRATEGY EXECUTION
  • 2.4.1. BSC components
  • 2.5. CONCLUSION
• CHAPTER 3: LITERATURE REVIEW: GENERIC CHALLENGES OF THE BSC
• • 3.1. INTRODUCTION
  • 3.2. OVERRATED LOGIC OF BSC PERSPECTIVES
  • 3.3. PERCEIVED PROBLEMATIC CAUSE-AND-EFFECT LOGIC
  • 3.4. ASSIGNING MEASURES IS A COMPLEX EXERCISE
  • 3.5. THE BSC CONCEPT ASSUMES UNIFORMITY IN ORGANISATIONS
  • 3.6. BSC DOES NOT ALIGN WITH OTHER ORGANISATIONAL SYSTEMS AND EXTERNAL STAKEHOLDERS
  • 3.7. BSC AND STRATEGY DEVELOPMENT
  • 3.8. PERCEIVED BSC IMPLEMENTATION CHALLENGES IN ACADEMIC INSTITUTIONS AS EXAMPLE
  • 3.9. BSC IMPLEMENTATION AND FAILURE CLAIMS
  • 3.10.CONCLUSION
• CHAPTER 4: LITERATURE REVIEW: STRATEGY EXECUTION AND PRACTICE OF BSC IMPLEMENTATION
  • 4.1. INTRODUCTION
  • 4.2. STRATEGY EXECUTION
  • 4.2.1. Why do strategies fail?
  • 4.2.2. Other strategy execution frameworks
  • 4.3. CHALLENGES OF BSC IMPLEMENTATION
    • 4.3.1. Business environment stability
    • 4.3.2. Leadership involvement
    • 4.3.3. Role clarification
    • 4.3.4. Validating critical success factors
    • 4.3.5. BSC complexity
    • 4.3.6. External consultants’ involvement
  • 4.4. SUCCESSFUL BSC IMPLEMENTATION
  • 4.5. CONCLUSION
• CHAPTER 5: RESEARCH METHODOLOGY
  • 5.1. INTRODUCTION
  • 5.2. QUALITATIVE VS. QUANTITATIVE RESEARCH METHODS
  • 5.3. RESEARCH PHILOSOPHY
    • 5.3.1. Ontology, epistemology and axiology
    • 5.3.2. Interpretivism
  • 5.4. RESEARCH APPROACH
  • 5.4.1. Inductive versus deductive research approaches
  • 5.5. RESEARCH STRATEGIES
    • 5.5.1. Case study
    • 5.5.2. Phenomenological study
    • 5.5.3. Auto-ethnography
  • 5.6. METHODOLOGICAL TRIANGULATION
  • 5.7. RESEARCH LIMITATIONS
    • 5.7.1. Case study
    • 5.7.2. Phenomenological study
    • 5.7.3. Auto-ethnography
  • 5.8. CONCLUSION
• CHAPTER 6: FINDINGS
  • 6.1. INTRODUCTION
  • 6.2. FINDINGS FOR RESEARCH QUESTION 1 – LITERATURE SOURCES
  • 6.3. FINDINGS FOR RESEARCH QUESTION 2 – CASE STUDY
    • 6.3.1. Case study findings
    • 6.3.2. Analysis of data
  • 6.4. FINDINGS FOR RESEARCH QUESTION 3 – PHENOMENOLOGICAL STUDY
    • 6.4.1. Drivers of strategy execution using the BSCEP process
    • 6.4.2. Analysis of data – drivers of strategy execution using the BSCEP
    • 6.4.3. Drivers of strategy execution at the ‘translate the strategy’ stage: compiling strategic objectives and strategy map
    • 6.4.4. Drivers of strategic execution at the ‘translate the strategy’ stage: assigning measures to strategic objectives
    • 6.4.5. Drivers of strategic execution at the “align the organisation” stage: cascading strategy to business units
    • 6.4.6. Drivers of strategic execution at the stage ‘execute the strategy: assigning strategic initiatives to support strategic objectives’
    • 6.4.7. Drivers of strategic execution at the stage “execute the strategy: cascading strategic objectives to personal contracts”
    • 6.4.8. Drivers of strategy execution at the “monitor and learn” stage: strategy review meetings management
  • 6.5. FINDINGS FOR RESEARCH QUESTION 3: ANALYTIC AUTO ETHNOGRAPHY
    • 6.5.1. Drivers of strategy execution using the BSCEP
  • 6.6. FINDINGS FOR RESEARCH QUESTION 4 – PHENOMENOLOGICAL STUDY
    • 6.6.1. Hindrances to strategy execution using the BSCEP
    • 6.6.2. Hindrances to strategy execution at the “translate the strategy” stage: compiling strategic objectives and strategy maps
    • 6.6.3. Hindrances to strategy execution at the ‘translate the strategy’ stage: assigning measures to strategic objectives
    • 6.6.4. Hindrances to strategy execution at the ‘align the organisation’ stage: cascading strategy to business units using strategy maps
    • 6.6.5. Hindrances to strategy execution at the ‘execute the strategy’ stage: assigning initiatives to support strategic objectives
    • 6.6.6. Hindrances to strategy execution at the “execute the strategy” tage: cascading strategic objectives to personal contracts
    • 6.6.7. Hindrances to strategy execution at the “monitor and learn” stage: strategic review meetings management
  • 6.7. RESULTS FOR RESEARCH QUESTION 4: ANALYTIC AUTO ETHNOGRAPHY
    • 6.7.1. Hindrances to strategy execution using the BSCEP
  • 6.8. METHODOLOGICAL TRIANGULATION – HINDRANCES
    • 6.8.1. Presentation of findings
  • 6.9. CONCLUSION
• CHAPTER 7: DISCUSSION OF FINDINGS
  • 7.1. INTRODUCTION
  • 7.2. DISCUSSION OF FINDINGS FOR RESEARCH QUESTION 1: LITERATURE REVIEW
  • 7.2.1. Content analysis of the BSC framework
  • 7.2.2. Conclusion
  • 7.3. DISCUSSION OF FINDINGS FOR RESEARCH QUESTION 2: CASE STUDY
    • 7.3.1. Lack of understanding of the BSCEP principles
    • 7.3.2. Insufficient stakeholder buy-in into the BSCEP process
    • 7.3.3. Organisational culture non-receptive to change
    • 7.3.4. Other existing tools in the organisation
    • 7.3.5. Perceived lack of support from the CEO and leadership
    • 7.3.6. Poor communication with all stakeholders
    • 7.3.7. External consultants-client gap
    • 7.3.8. Conclusion
  • 7.4. DISCUSSION OF FINDINGS FOR RESEARCH QUESTION 3 – PHENOMENOLOGICAL STUDY
    • 7.4.1. BSCEP training
    • 7.4.2. Good project management skills
    • 7.4.3. Strategy available to everyone
    • 7.4.4. Aligning employee performance management systems and processes with strategy execution
      • 7.4.5. Stakeholder buy-in
  • 7.5. DISCUSSION OF FINDINGS FOR RESEARCH QUESTION 3 – ANALYTICAL AUTO-ETHNOGRAPHY
    • 7.5.1. Strategy communication to all employees
    • 7.5.2. BSCEP training
    • 7.5.3. Good project management skills
  • 7.6. DISCUSSION OF FINDINGS FOR RESEARCH QUESTION 4 – PHENOMENOLOGICAL STUDY
    • 7.6.1. BSCEP complexity
    • 7.6.2. Perceived lack of strategic management knowledge
    • 7.6.3. Strategy versus operational meetings
    • 7.6.4. Politics and detractors
    • 7.6.5. Poor data/metrics management and IT systems
    • 7.6.6. Lack of alignment with supporting units’ scorecards
    • 7.6.7. Existing frameworks in the organisation
  • 7.7. DISCUSSION OF FINDINGS FOR RESEARCH QUESTION 4 – ANALYTIC AUTO-ETHNOGRAPHY
    • 7.7.1. Complexity of the BSCEP process
    • 7.7.2. The consulting firm’s role in implementing the BSCEP – the external consultant-client gap
    • 7.7.3. Existing frameworks in the organisation
    • 7.7.4. Establishment of the Office of Strategy Management as a staff function
    • 7.7.5. Lack of buy-in from leadership
    • 7.7.6. Inadequate data/metrics management and IT systems
  • 7.8. CONCLUSION
• CHAPTER 8: CONCLUSIONS AND RECOMMENDATIONS
  • 8.1. CONCLUSION SUMMARY
  • 8.2. RECOMMENDATIONS – KEY REMEDIES TO OVERCOME BSCEP IMPLEMENTATION BARRIERS
  • 8.2.1. BSCEP awareness workshops before implementation
  • 8.2.2. Stringent measures for dealing with the naysayers
  • 8.2.3. Education and training regarding the BSCEP benefits
  • 8.2.4. Prior investigation of other tools in the organisation
  • 8.2.5. The BSCEP should be on the CEO and leadership’s performance contract
  • 8.2.6. Set up tailor-made communication amongst all stakeholders
  • 8.2.7. Train internal staff members as process champions
  • 8.3. OVERCOMING HINDRANCES TO STRATEGY EXECUTION USING THE BSCEP
  • 8.3.1. BSCEP training
  • 8.3.2. Cascade the BSCEP and strategy to everyone’s personal contracts
  • 8.3.3. Ensure all stakeholders have a high level understanding of strategy
  • 8.3.4. Include stakeholders from information technology (IT) in BSCEP implementation plans
  • 8.3.5. Hold separate meetings for strategy reviews and operational reviews
  • 8.3.6. Engage and communicate with both the business units and the support units regarding the strategy and the BSCEP
  • 8.3.7. Check the compatibility of the BSCEP with other frameworks in the organisation for strategy execution purposes
  • 8.3.8. Conclusion
  • 8.4. RECOMMENDED BSCEP READINESS ASSESSMENT – PHASE
  • 8.4.1. BSCEP readiness assessment – health check
  • 8.5. RECOMMENDED ORGANISATIONAL CLIMATE FOR STRATEGY EXECUTION USING THE BSCEP – PHASE
  • 8.6. CONCLUSION

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