Posts Tagged ‘balanced scorecard’

Brenden’s Booklist

April 27th, 2011 Comments off

Students don’t often have time to read a lot during the semester for obvious reasons.  As a result, I have had a number of people ask for me to make a list of the books I mention in class and that I find helpful/interesting so that they can reference the list at a later date (since course website access is blocked after the semester).  Here are some more books that I have found to be good reads of late (someone asked me how I read so much and I have to say that buying a Kindle has made me want to read so much more than when I bought regular books).  These are presented in no particular order other than as I remember them.

  1. The Big Short: Inside the Doomsday Machine by Michael Lewis.  This is perhaps the best book I’ve read in the last year on the economic meltdown.  It is great both in terms of readability and level of detail/understanding.  The author did a great job researching this book and presents it in a way that is easy to understand.  At focus here is how the incentives on Wall Street encouraged risk-taking behavior that ultimately collapsed when the housing market didn’t keep rising (many assumptions and models were based on housing prices never declining and some were based on prices never even leveling off for any period of time).
  2. Enchantment: The Art of Changing Hearts, Minds, and Actions by Guy Kawasaki. I first heard about this book (and its author) on a Minnesota Public Radio program. Kawasaki proved to be as strong at authoring as he was on the radio and this was a truly enjoyable and interesting read.  If you are tasked with finding/keeping/serving customers or members you will get a lot out of this book.  In particular, I really enjoyed the sections devoted to using online social media tools such as blogs, Facebook, Twitter, and LinkedIn.  The use of these tools to actually engage customers rather than just to serve as an electronic brochure is something that will separate great companies from good ones in the near future and the use of these tools (and new ones that aren’t even around yet) is sure to grow.
  3. No One Would Listen: A True Financial Thriller by Harry Markopolos is another great read.  I didn’t like it as much as The Big Short because Markopolos comes off as a bit egotistical (even moreso in person — I saw him speack at the MNCPA MBAC conference last June).  Markopolos is the guy that busted Bernie Madoff and his Ponzi scheme.  Actually, he tried for years to get the SEC to investigate Madoff with little success and only once Madoff admitted to his crimes did Markopolos gain notoriety.  Prior to that he lived a life of fear for some time (he felt his life and the lives of his family members were in danger, in fact).  I have friends that thought this book was way bettter than The Big Short so it may just appeal to a different sort of person.  It was still worth reading to me, but just didn’t flow like The Big Short did.
  4. A Whole New Mind: Why Right-Brainers Will Rule the Future by Dan Pink.  This was an eye-opening book to someone that works in a field that is decidedly left-brain-based.  Pink’s point is that the left-brain functions so common to a field like accounting can often be replaced by technology/computers and a lot of what is left can be easily outsourced to developing nations. Pink has a new book out on motivation and he did a great TED Talk on it as well.
  5. Thank God It’s Monday: How to Create a Workplace You and Your Customers Love by Roxanne Emmerich.  This book is by a local woman and I first became aware of it last fall when it was featured on KARE-11 News.  She later wrote a short article for the MNCPA Footnote newsletter.  Building a workplace that employees love will automatically translate into a workplace that customers love.  The Balanced Scorecard tells us that and we can all identifiy places we have done business where we dreaded shopping and those where we loved shopping, simply because we could tell whether or not the employees were happy.  Emmerich does a great job of explaining how to set up a culture that accomplishes the goal of a happy workplace and a great place to do business.
  6. All the Devils Are Here: The Hidden History of the Financial Crisis by Joe Nocera.  I’m reading this one right now.  I still think The Big Short is a more engaging story (better written) but the details in this book are well researched and it is interesting in its own right.  I did find it to be more interesting in the last half of the book so if you find it discouraging early on, you should find that things pick up after that.  If you have to choose to read one book about the financial crisis, though, my money is on The Big Short.
  7. Start with Why: How Great Leaders Inspire Everyone to Take Action by Simon Sinek.  We watched Sinek’s TED Talk on this same topic in class and the book is just as engaging while covering the same ground in more depth.  I have shared this book and video with others in my company and they have all provided great feedback and thanked me for doing so.  In hindsight, the ideas seem simple but they are obviously difficult to execute given how few companies have had success linking with their customers on the “why” of their products/services.
  8. The Back of the Napkin: Solving Problems and Selling Ideas with Pictures by Dan Roam.  Like A Whole New Mind, mentioned above, this book takes the approach that we need to appeal to the right-brain when making decisions and in marketing our ideas.  You’ve all heard the saying that “a picture is worth a thousand words” and even those that think they can’t draw (like most accountants) can learn to use quick sketches to communicate and to make faster/better decisions.  Roam is a keynote speaker at the MNCPA Management & Business Advisors Conference in June. He has asked that audience members be provided whiteboards and markers to gain practice with the techniques he champions in his book (and a follow-up book) as he speaks.  It should be interesting. Note, that this book was TERRIBLE on the Kindle because the drawings were too small or jumbled up.  Get the paper edition if you buy this one.
  9. Dethroning the King: The Hostile Takeover of Anheuser-Busch, an American Icon by Julie MacIntosh. Is there any symbol of American marketing might bigger than Budweiser?  How is it that this company based in the heartland came to be swallowed up by InBev, a Belgian/Brazillan brewer? I loved this book and found it to be very engaging. Even with the outcome known, I found myself shaking my head at the missteps taken by the St. Louis-based brewer as globalization hit the industry.  The characters of the Busch family are exposed in great detail — they acted like Anheuser-Busch was a family company even though they had long ago become just minority shareholders incapable of stopping a takeover no matter how hard they tried.  In a story that is likely to be repeated in other industries the business world is changing and executives need to be aware of what happens outside company walls if they want to maintain power as other markets become as strong or even stronger than those dominated by American firms.
  10. The Omnivore’s Dilemma: A Natural History of Four Meals by Michael Pollan.  A LinkedIn contact recommended this book.  It was a great read and may well change how you shop for food and what you choose to consume.  I know that I am more conscious of what I put into my body after reading this.
  11. Why We Get Fat: And What to Do About It by Gary Taubes. I didn’t realize how impacted the science of food had been by politics until I read this book.  Lots of things that were known to German scientists some 70+ years ago were discounted after World War II because of political reasons and an unwillingness to trust anything German rather than for outright scientific reasons.  Taubes offers specific advice about what to eat (protein and complex carbohydrates) and what not to each (sugar, refinef flours, carbohydrates) if the goal is to lose fat and reduce weight.  Much of this advice contradicts what Americans have been told for 50+ years, even while as a nation we get fatter and fatter. There are scientific footnotes in this text, but Taubes wrote this more for laypeople becuase an earlier book was criticized for reading like a scientific journal.
  12. Man’s Search for Meaning by Viktor Frankl details his life as a prisoner in a concentration camp during World War II.  In that environment, life takes on a very basic form and it is this experience that sets the stage for the prism through with Frankl sees life as a psychotherapist after the war.  We get a glimpse into human behavior that likely only exists in scenarios such as those of the concentration camps and I learned a lot about life and was forced to realize that all my complaints are ridiculously minor in comparison. I stumbled on this book because I was involved in a conversation on LinkedIn about “the best book I’ve ever read.”  I didn’t even contribute to the topic because I find it difficult to elevate any one book to “the best” one ever, but someone posted this gem and I’m quite glad I read it.
  13. Empowered: Unleash Your Employees, Energize Your Customers, and Transform Your Business by Josh Bernoff and Ted Schadler. Somehow I got a free copy of this book on my Kindle last September before it was even released.  It’s like Amazon knew I’d find it interesting and that I’d share my experience with lots of people. It highlights this same phenomenon of information sharing and decentralized structures that the authors predict will be the wave of the future.  They argue that since customers are more empowered (consider the information consumers have now about nearly any product as compared to 20 years ago) that companies need to be as well.  For example, Best Buy is featured extensively in the book for their Twelpforce concept that has turned customer service into a proactive task and customer difficulty into an opportunity instead of a curse.  I loved reading this book but I’m guessing the challenge will be to get buy-in from the people that need to make the biggest changes: those entrenched in the IT department.  In my experience, IT policies can be terribly restrictive and I’m not sure how to get the ideas presented in Empowered into the hands of the people that need to change direction since, in a way, doing so is a threat to their existence.

Dashboards: Business Intelligence At A Glance

December 2nd, 2010 Comments off

I once had a top executive tell me that each morning he needed to have all the information needed to run his business on a 3″ x 5″ index card.  That index card was a form of a “dashboard” providing summary data in a snapshot format for senior management to use in decision-making.  Technology imporovements have made it possible to build more complex dashboards complete with real-time functionality.   It is still necessary, however, to make choices about what to include on them for the sake of not overwhelming the decision makers with things that are not relevant. 

In business, dashboards are emerging as the new face of Business Intelligence. Dashboards let us consolidate information about the health of our business, our department, our branch or more, in a graphical format that is concise and easy to read. They also come in different colors and shapes, with names like Performance dashboard, Executive dashboard, Balanced Scorecard, KPI metric summary or Corporate dashboard. The goal? To showcase the facts in a way that empowers the user to make more intelligent decisions based on better information.

The CPA Technology Adivisor has a nice primer on dashboards at this link: Dashboards: Business Intelligence At A Glance — NEWS – The CPA Technology Advisor.

Sustainability Reporting

August 24th, 2010 Comments off

Tom Hood has a piece today at CPA Success that mentions the idea that sustainability reporting may be on the fast track to becoming standardized and required.

On Monday, Aug. 2, 2010, the formation of the International Integrated Reporting Committee (IIRC) was announced. The committee is led by Prince Charles, The Prince’s Accounting for Sustainability Project (A4S) and the Global Reporting Initiative (GRI) in an attempt to add a globally accepted set of standards for accounting for sustainability.

As I have posted previously, there have been more companies voluntarily heading down this path or even requiring suppliers to do some limited sustainability reporting, but these have been largely voluntary efforts.  The Blocher textbook dives into this issue as well by discussing “sustainability” as the “5th perspective” of the balanced scorecard. As this ball gets rolling and as the public demands ever more information on environmental impacts from companies it makes sense to have standards to allow for comparability. Keep watching for more of this…

Read more:

Five Ways Pixar Makes Better Decisions

July 16th, 2010 Comments off

Here is a short read previewing an upcoming book about companies that make great decisions.  Having an advantage at decision making over competitors can make for a huge advantage in the marketplace as products reach c0nsumers more quickly, quality is higher, and employees are happier in these kinds of organizations.

We think that organizations with good judgment have a number of typical attributes. One is that they involve a number of different people in making important decisions. Their senior executives keep in mind that they don’t have a monopoly on knowledge and judgment and therefore involve multiple people in decision processes.

The short blog post linked below highlights how some things work at Pixar that are part of their “high-quality decision making culture.”  Furthermore, it is easy to pick out some things like Pixar University and manager autonomy that relate to things like the Learning & Growth perspective of the balanced scorecard that we have discussed in class.

Read more at: Five Ways Pixar Makes Better Decisions – Tom Davenport – Harvard Business Review.

Engagement is Key to Meeting Strategic (and, therefore Financial) Goals

August 6th, 2009 Comments off

Throughout the course of Acct 320, we come back time and again to the Balanced Scorecard model and the idea that improvements internally in things like employee relations and internal business processes eventually “bubble up” to improve the customer experience and the financial measures of a company.  Reinforcing that concept is a great piece that I found today at that focuses on employee engagement and the impact that improving it can have on a company’s bottom line.  The article specifically mentions Best Buy in an example of this concept.

Best Buy was able to demonstrate that an increase in engagement among its store employees of 0.1 percent on a 5 point scale resulted in an annual profit increase of $100,000 for their store. If you really believe that your employees are the lifeblood of your company then your employees are an integral part of your brand equity.

In fact, employee engagement can be a piece of the puzzle in terms of differentiating your company/product from that of others.  As I have mentioned in class, with the vast amounts of information available to us as consumers via the internet, nearly every product trends toward becoming a commodity.  Something needs to be done to stand out in this environment so that you are able to charge the premium necessary to have brick-and-mortar operations when companies operating in the virtual world obviously have lower costs…employee engagement can help with that.

Aren’t you interested in growing the value of your customers, and in so doing increasing profitability? Engaged employees make a positive contribution to the bottom line. Disengaged employees with no emotional connection to the business or the customers negatively impact profitability.

The internet has created a global marketplace where much of what businesses produce can be commoditized. Today customers are just a click away from access to a number of alternatives if they are unhappy with a brand experience. In addition, social networks and blogs allow unhappy customers the ability to broadcast their unhappy experiences to consumers around the world.

Read more of this excellent piece including some discussion about aligning compensation with strategy at the link below:

The CEO’s New Strategic Imperative – Engagement

Relying on Empowerment

July 8th, 2009 Comments off

Chapter 19 touched on the idea of “empowerment” being a measure for quality in the Learning & Growth perspective of the Balanced Scorecard.  Fittingly, I came across a post made by the head of Royal Caribbean discussing empowerment and quality in the cruise industry.

Having experienced the empowerment of Royal Caribbean employees on several past cruises I can certainly say that Royal Caribbean is 2nd to none when it comes to empowering employees throughout the organization to do right by the customer. Everyone from the cruise director to the guest relations staff to the assistant waiter in the dining room is allowed and encouraged to make every effort to please the customers.  This is evident in everything they do and it is what makes a Royal Caribbean cruise vacation so special and enjoyable, in my opinion.  Usually after a cruise the thing that I share with everyone is not the sights or the weather, but rather the staff and high level of service I experienced onboard the ship.

As to the question posted by about if empowerment is something that is granted vs. is it something you feel, my sense is that both need to be present for an organization and its people to excel.  Someone can “feel empowered” but not for very long if they aren’t granted the permission to act upon that feeling.  Spirits are crushed easily and employees that desire empowerment/responsibility will leave a company that does not allow them to act upon that desire.

Also, someone can be granted permission to be empowered but if they don’t feel empowered (perhaps a clash of unwritten vs. written policy or just their nature) then they will not exhibit empowered behavior.

Great people and a supportive culture need to come together for empowered behavior to be the norm and for a company, such as Royal Caribbean, to gain a reputation for empowerment.  Companies that do so can trade on that reputation of high-quality service and have to guard against anything negative from destroying all that they have built-up.

How a Tata Motors unit turned around with Balanced Scorecard

May 10th, 2009 Comments off

Here is an example of a company in India, Tata Motors, that found benefits from using a Balanced Scorecard. We discuss the Balanced Scorecard in the first week of the semester and then again toward the end of the semester. Companies that have a balanced scorecard (or a successful one at least) have the goals/measures of the balanced scorecard interwoven throughout the organization.

If there is a single recipe to competitive advantage, it must be the ability to respond to changes in the business environment. This response is an ongoing process, backed by consistent measurement and performance review. Success in the future is shaped by learning from the past and implementing these lessons in the present.

How a Tata Motors unit turned around with Balanced Scorecard.  Suresh Lulla.  DNA India.  May 11, 2009.

The Balanced Scorecard: Here and Back

April 19th, 2009 Comments off

This article gives a great history of the evolution of the Balanced Scorecard as a measurement and strategic tool in organizations. We will come back to the Balanced Scorecard later this semester and some of what is in this article will be more applicable then, but I feel that anytime you can see how these things we talk about in class are written up and/or used in the “real world” the easier it can be to understand.