Create, organize and expedite a strategic plan: how to use the balanced scorecard and the stage-gate funnel

Information Outlook, March, 2005 by Laura Claggett, Barbara Eklund

Special librarians sometimes have a make-it-up-as-we-go-along attitude, but we also like to know where we are going and what we need to do to get there. We motivate ourselves by setting goals, working vigorously to meet them, and looking back at the end of the year to see our many accomplishments. We like to see ideas become realities, to see positive changes happen around us, and to see our libraries and our team members grow and develop day by day.

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For these reasons, it is important to have pertinent management tools to help us create, organize and expedite our strategic plans--to make sure we get where we want to be and where our customers need us to be. Planning increases the chance that we will achieve our vision and goals. It will help us focus our boundless energies and help us identify not only what we need to do, but what not to do. Especially if faced with shrinking budgets, staff cuts, and/or economic uncertainty, it's just not realistic to do everything for everybody all the time. To prevent spreading our resources too thin, and to still accomplish our goals, we definitely need to create or rethink a strategic plan.

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Our criteria for a good plan are:

* It must be flexible, not written in stone--as our environments change, we need to change with them.

* Everyone is involved in its creation.

* It's not just a once-a-year exercise, or a piece of paper that's created and never looked at again.

* It's actionable and relevant to the library's and company's vision/mission.

* It's geared toward the customers.

Two useful tools to organize and expedite the strategic planning process are the balanced scorecard and the stage-gate funnel.

The Balanced Scorecard

The balanced scorecard is an incredibly useful strategic planning tool developed by Dr. Robert Kaplan and David Norton of the Harvard Business School in the early 1990s. Howard Rohm of the Balanced Scorecard Institute (www.balancedscorecard.org) describes it as a performance management system that can be used by any size organization to:

* Align the vision and mission with customer requirements and day-to-day work.

* Manage and evaluate business strategies.

* Monitor operation efficiency improvements.

* Build organization capacity.

* Communicate progress to all employees.

Supporting the vision and mission of an organization is at the heart and soul of strategic planning. Breaking down a plan into small, manageable portions, shows more clearly if the projects directly correlate with the company's overall vision and mission.

The balanced scorecard shows a strategy from four different, but interconnected perspectives (figure 1).

* Financial: How do we/should we measure and evaluate our financial performance? Do our metrics send the right message (i.e. speak the language) of our stakeholders?

* Internal business processes: At what business processes must we excel?

* Customers: How do we/should we appear to our customers?

* Learning and growth: How will we sustain our ability to change and improve?

Note: All perspectives lead to the financial perspective.

Each of the four quadrants is broken down further into objectives. Under the objectives are initiatives (projects) and then metrics. In other words, it is: what you are trying to accomplish, how you plan to do it, and how you will measure success. Figure 2 is a brief example of one objective, with initiatives and metrics, for an internal business process with the strategy of expanding online content.

Ultimately, the scorecard process breaks the strategic plan into manageable pieces while at the same time providing measures to communicate the library's evidence-based management to upper management. Showing that the library's objectives and accompanying projects are in line with the library's strategic plan, which supports the company-wide strategy, legitimizes the presence of the library within the organization. In other words, the balanced scorecard helps organize and run the library according to a specific strategic plan, while demonstrating the library's value to the company as a whole.

Most library managers create strategic plans specific to their library. They do not rely solely on their company's strategic plan, so the manager can create a scorecard that will help manage the library's unique plan. In the article "Determining and Communicating the Value of the Special Library" (Information Outlook, March 2003), Joseph Matthews mentions that the scorecard approach for the special library is based on answering four questions:

* How do our stakeholders see us? (financial perspective)

* At what must we excel? (internal business processes perspective)

* How do customers (and non-users) see the library? (customers' perspective)

* How can the library continue to improve and create value? (learning and growth perspective)

Matthews puts a great deal of emphasis on the "measures" aspect of the balanced scorecard. He suggests formulating targets (objectives) in each of the four areas and designing three to five measures for each. Some sample measures include: