Certified Strategy Execution Professional

(CSEP)

Destination Statement,
St t
Strategy
Map
M
& BSC
August 14, 2009
JW Marriott Hotel
Surabaya

Speaker:

Fenny
y Wijaya
j y
Management Consultant
GML Performance Consulting (Asia)
Head Office:
Artha Gading Niaga Blok G No.19. Jl.Bulevar Artha Gading, Kelapa Gading Barat, Jakarta 14240
Phone : +62 21 4585 0861 ( Hunting )
), Fax :+62 21 4585 0862 Email : gml@gmlperformance.co.id
gml@gmlperformance co id
Branch Office :
Medan, Jl. Asia Raya Blok MM No.7,Komp Asia Mega Mas,Medan 20216 Indonesia
Phone :+62 61 735 2042, Fax :+62 61 732 5926 Email : gmlmedan@gmlperformance.co.id
Bandung Jl
Jl. Sari Asih No
No.54,
54 Bandung 40151 Indonesia
Malaysia Lot 157958 ( 2823 ),5 Miles, Jl.Kebun Kampung Jawa,42450,Klang,Selangor - Malaysia
www.gmlperformance.com

This document is strictly confidential and intended solely for the informationof the client to whom it is addressed
No part of this document may be reproduced without prior written from the client and GML

YOUR FACILITATOR
Fenny Wijaya
Consultant of GML Performance Consulting
Civil Engineer from University of North Sumatra,
Sumatra Medan
Magister Management from IBII, Jakarta
Involved in consulting projects for clients, including:
9 Balanced Scorecard Implementation,
9 360 degree Assessment,
9 Customer Satisfaction Survey,
Survey
9 Employee Satisfaction Survey,
9 etc.

Extensive experience in training material development and trainers

manual development.

COURSE OUTLINE

4. Strategy Analysis
5. Strategy
gy Formulation

1. Need for SPFO

4.
5.
6.
7.

1.
Strategy
Development

13. Strategy Review

14. Review with
QPR Automation

5.

2.

Monitor,
Learn &
Adapt

11. Operational
Improvement
Methodology
12 Effective Planning &
12.
Organizing

Strategy Map
Measures & Target
g
Initiative Management
Integrating Enterprise Risk
Management

Strategy
Mapping
M
i

Leadership
Commitment
in Becoming
an SPFO

4.

3.

Operational
Planning
g

Organization
Alignment
g

8. Vertical & Horiontal

Alignment
9. Individual Alignment
10. Change Management

DESTINATION STETEMENT,,
STRATEGY MAP & BSC
Course Agenda

Understanding BSC
Strategy Map
Value Proposition
Three types of KPI
Target Setting
KPI Manual
M
l

MENGAPA PENTING MEMILIKI TUJUAN?

Penelitian menunjukkan bahwa
menetapkan dan menuliskan
tujuan
j
b
berpengaruh
hb
besar d
dalam
l
membantu individu menggapai
harapannya (aspiration)

Individu yang berprestasi tinggi

cenderung untuk memiliki dan
menetapkan tujuan yang
g
menantang
5

BEBERAPA ISTILAH KUNCI DALAM

MANAJEMEN STRATEGIS
STRATEGI :
:

Suatu p
pernyataan
y
yyang
g ringkas
g
dan p
padat,,
menjelaskan apa yang organisasi harus lakukan
dengan baik dalam rangka eksekusi strategi

Visualisasi keterkaitan antara sejumlah Sasaran

Strategis, dalam bentuk hubungan sebab-akibat,
yang menjelaskan
j l k perjalanan
j l
strategi
t t i organisasi
i
i

Proyek spesifik yang harus diimplementasikan

untuk mendukung pencapaian Sasaran Strategis.
Suatu p
proyek
y biasanya
y memiliki awal dan akhir.

SASARAN
STRATEGIS

STRATEGY
MAP

INISIATIF/
ACTION PLAN

Serangkaian aktivitas yang dilakukan secara

berbeda dibandingkan dengan pesaing untuk
memberikan nilai tambah kepada pelanggan

DESTINATION STATEMENT
A Destination Statement:
A Snapshot
p
of what an organization
g
is expected
p
to be
like 3-5 years in the future
As
A the
th jjourney iin achieving
hi i it
its vision
i i
The statement is very tangible and concrete
Some elements are hard numerical targets (e.g.
inflation) but some are descriptive (e
inflation),
(e.g.
g culture)

Adapted from 2CG Conference, 2004

7

DestinationSState
Destination
tatements
By end of 2009,
we will achieve the following:
Total integrated sales of: USD xx
No. 1 Market share leader in Indonesia
Profitable operations in Singapore, Malaysia, and
3 other select countries

OUR VISION AND MISSION:

To become the leading family and
business security-service provider in
A i b
Asia
by providing
idi fi
firstt class
l
services
i
to our customers through our first
class, motivated team in order to
deliver first class return of investment
to our shareholders.

Customer Satisfaction Index higher than

competitors in all aspects
Deduction rate of less than USD XX per customer
Full implementation of:
Performance Management and Reward
systems for all employees
World
World-class
class people development
development, career and
succession planning
Positive EVA

TRANSLATING MISSION INTO DESIRED

OUTCOME
Mission
Why we exist
Core Values
What we believe in
Vision
What we want to be
Strategy
Our game plan
Balanced Scorecard
Implementation and focus
Strategic Initiatives
What we need to do
Personal Objectives
What
h I need
d to do
d

Strategic Outcome
Satisfied
Shareholders

Delighted
Customers

Effective
Process

Motivated & Competent

Workforce

UNDERSTANDING BSC
CONCEPT

10

WE HAVE ASSISTED MANY PRIVATE, GOVERNMENT AND

NOT-FOR-PROFIT ORGANISATIONS VISUALIZE THEIR
STRATEGIES
MEDIKA
GRIA

KOMPAS GRAMEDIA GROUP

GRAMEDIA MAJALAH

And many more

11

WHAT IS THE MOST DIFFICULT STEP?

Create the
Strategy

Implement the
St t
Strategy

12

WHAT IF WE WERE
TO VISUALIZE STRATEGY
BEFORE
IMPLEMENTING IT?

Create the
Strategy
Visualise the
Strategy
Implement the
Strategy
13

BALANCED SCORECARD
BSC is
p organizations
g
a fframework that helps
visualize its strategy and
t
translate
l t the
th strategy
t t
i t operational
into
ti
l
objectives
j
that drive both behavior
and performance.

Copyright 2006, Stroudwater Associates, Inc. All Rights Reserved

14

DEFINING BALANCED
BALANCED

Financial and non-financial and indicators

Past current and future indicators

Past,

Internal and external indicators

Cause/Drivers (Lead) and Effect/ Outcome (Lag)

indicators

15

EVOLUTION OF BSC
FIRST GENERATION
Goals
Survive
Succeed
Prosper

FINANCIAL
Measures
Cash Flow
Quarterly sales growth
Operating income
Increased Market Share
ROE

Internal Business Perspective

Goals
Measures
Techno. Capability
Manuf Index vs Competition
Cycle time
Manuf. Excellence
Unit Cost
Yield
Silicon Efficiency
Design Productivity
Engineering Efficiency

CUSTOMER PERSPECTIVE
Goals
Measures
New Products
% Sales from new products
Responsive supply
On time delivery
Preferred supplier
Share of key acct purchases

INNOVATION AND LEARNING PERSPECTIVE

Goals
Measures
Techno. Leadership Time to develop next G
Product focus
% of product sales per focus

THE EVOLUTION:
From measurement, to management
From perspectives, to strategic linkages
F
From
controlling,
t lli
tto strategy
t t
communication
i ti
From private, to public sectors

SECOND GENERATION
Meningkatkan
ROCE menjadi
12%
Meningkatkan
Pertumbuhan
Revenue

Financial
Perspective

Menyediakan
Brand Image
yg Superior

Customer
Perspective
IInternall
Perspective

Meminimasi
Biaya

Membangun
Partnership
dgn Distributor

Inovasi
Produk

Menepati janji FI
pada pelanggan

Merampingkan
Pemenuhan
Permintaan

Innovation and
Learning
g Perspective
p

Mengkaitkan organisasi
dengan teknologi

Mengelola Hubungan
dg Supplier

Mengembangkan
Kultur
Perusahaan

Upgrade
Mesin &
Alat

Meningkatkan
efektivitas
Maintenance

Melatih
Tenaga
Kerja yang
Potensial

16

LEADERSHIP ROLES IN PATH FINDING

Make planning important

Provide an inspired, and stretched

vision of the organizations
direction

Look for the unlikely or not-soobvious

Promote and drive towards change:

better or different

Install an integrated planning

process and planning infrastructure

Provide staff support to support the

strategic planning process

Allocate time, money and personal

support

Deal with the outside world

Make, push or affirm timely

decisions

Set high standards

Hold people accountable for long

term results

VISION &
DESTINATION

Financial Perspective
To S
T
Succeed
d fi
financially,
i ll how
h should
h ld
we appear to our shareholders?

Customer Perspective
p
To achieve our vision, how should
we appear to our customers?

Reward people accordingly

Adapted from Team Based Strategic Planning, by C. Davis Fogg

IInternall Business
B i
Process Perspective
To satisfy our shareholders, and
customers, what business processes
must we excel at?

Learning & Growth

Perspective
To achieve our vision, how will we
sustain our ability to change and
improve?
17

BALANCED SCORECARD: FOUR PERSPECTIVES

Y t d
Yesterday
Financial Perspective
To Succeed financially, how
should we appear to our
shareholders?

Customer Perspective
To achieve our vision,
how should we appear to
our customers?

VISION &
STRATEGY

Today

Internal Business Process

Perspective
To satisfy our shareholders,
and customers, what
business pprocesses must we
excel at?

Today
Learning & Growth
P
Perspective
ti
To achieve our vision, how
will we sustain our ability to
change and improve?
improve?

Future

Source: Adapted from Robert S. Kaplan and David P. Norton, Using the Balanced Scorecard as a Strategic Management System
18

BSC ALIGN VARIOUS STRATEGY DEVELOPMENT AND

OPERATIONAL IMPROVEMENT METHODOLOGIES

Financial- and Portfolio-Based Approaches

Positioning/ Niches

Lean manufacturing
TQM/ Six Sigma
Reengineering
Time-driven ABC

Risk

Shareholder Value

Customer Loyalty

Operations
Excellence

Customer
Relationship

Innovation

COSO
Enterprise risk
management

Customer Value Proposition

Strategy Map

Five forces value chain

Resource-based view
Core competencies
Scenario planning

Productivity/ Quality

BSG growth-share, GE matrix

Ansoff Development Matrix
Shareholder value/ economic value added

Blue ocean
3 Value Proposition
Community Marketing
Social Responsibility
y

Social
Responsibility

Local community
ISO 14001
BUMN UKM Sponsorship
Innovation

Learning & Growth Perspective

Adapted from: The Executive Premium by Robert S. Kaplan & David P. Norton

Open innovation
Ideation
Core competencies

19

CAUSE & EFFECT RELATIONSHIP :

FAST FOOD RESTAURANT

Profit

Financial

Customer Loyalty

Customer
Internal
Business
Process

Quality Food

Learning &
Growth

Fast Service

Employee
p y
Skills &
Attitude

= Strategic Objective
20

STRATEGY MAP PT SECURINDO Tbk.

VISION: To become the leading family and business security-service provider in Asia by providing first class services to our customers

B
Business
Process

Custome
er

Financial

through our first class, motivated team in order to deliver first class return of investment to our shareholders.
OPTIMAL ROE TO
SHAREHOLDERS
Revenue Growth
INDONESIA
T i
Territory

Overseas
M k
Market

Cost Reductions

Customer
Custo
e Loyalty
oya ty

Improved
Customer
Satisfaction

Enhance Long
Term Partnership
with Suppliers

Expansion to
Overseas Market
Renewed Corporate
Image

Improve Security
Service Quality

Intensify Sales
and Business
Development
Activities

Acquire Overseas
Companies

Intensify Research
and Development

Learning
g&
Growth

Effective
Cash Flow
Management

Improve
Collection
Processes

Implement Media
Relations and
Exposure

Reengineer Work
Processes
Enhance Staff
Productivity

Enable IT Systems
to Support
Businesses

Develop
Competent
Workforce

Develop
Leadership at all
Levels

21

B
Business
Process

Custome
er

Financial

STRATEGIC THEME:
MAINTAIN INDONESIAN CUSTOMER BASE
OPTIMAL ROE TO
SHAREHOLDERS
Revenue Growth
INDONESIA
T i
Territory

Overseas
M k
Market

Cost Reductions

Customer
Custo
e Loyalty
oya ty

Improved
Customer
Satisfaction

Enhance Long
Term Partnership
with Suppliers

Expansion to
Overseas Market
Renewed Corporate
Image

Improve Security
Service Quality

Intensify Sales
and Business
Development
Activities

Acquire Overseas
Companies

Intensify Research
and Development

Learning
g&
Growth

Effective
Cash Flow
Management

Improve
Collection
Processes

Implement Media
Relations and
Exposure

Reengineer Work
Processes
Enhance Staff
Productivity

Enable IT Systems
to Support
Businesses

Develop
Competent
Workforce

Develop
Leadership at all
Levels

22

B
Business
Process

Custome
er

Financial

STRATEGIC THEME:
EXPAND TO OVERSEAS MARKET
OPTIMAL ROE TO
SHAREHOLDERS
Revenue Growth
INDONESIA
T i
Territory

Overseas
M k
Market

Cost Reductions

Customer
Custo
e Loyalty
oya ty

Improved
Customer
Satisfaction

Enhance Long
Term Partnership
with Suppliers

Expansion to
Overseas Market
Renewed Corporate
Image

Improve Security
Service Quality

Intensify Sales
and Business
Development
Activities

Acquire Overseas
Companies

Intensify Research
and Development

Learning
g&
Growth

Effective
Cash Flow
Management

Improve
Collection
Processes

Implement Media
Relations and
Exposure

Reengineer Work
Processes
Enhance Staff
Productivity

Enable IT Systems
to Support
Businesses

Develop
Competent
Workforce

Develop
Leadership at all
Levels

23

B
Business
Process

Custome
er

Financial

STRATEGIC THEME:
COST MANAGEMENT
OPTIMAL ROE TO
SHAREHOLDERS
Revenue Growth
INDONESIA
T i
Territory

Overseas
M k
Market

Cost Reductions

Customer
Custo
e Loyalty
oya ty

Improved
Customer
Satisfaction

Enhance Long
Term Partnership
with Suppliers

Expansion to
Overseas Market
Renewed Corporate
Image

Improve Security
Service Quality

Intensify Sales
and Business
Development
Activities

Acquire Overseas
Companies

Improve
Collection
Processes

Implement Media
Relations and
Exposure

Reengineer Work
Processes

Intensify Research and

Development

Learning
g&
Growth

Effective
Cash Flow
Management

Enhance Staff
Productivity
Enable IT Systems
to Support
Businesses

Develop
Competent
Workforce

Develop
Leadership at all
Levels

24

A COMPLETE BALANCED SCORECARD

Strategy Map
Process: Operations Management
Theme: Ground Turnaround
Profit and
RONA
Grow
revenues

Fewer
planes

Attract and retain

more customers

On-time
service

Lowest
prices

Fast ground
turnaround

Scorecard

Action Plan

Objectives

Measurement

- Profitability
- Grow revenues
- Fewer planes

- Market value
- Seat revenue
- Plane lease cost

- Attract and retain

more customers

- # repeat customers - 70%

- # customers
- Increase
12% annually
- FAA on-time arrival - #1
rating
- Customer ranking - #1

- Implement CRM - $XXX

system
- Quality
- $XXX
management
- Customer loyalty - $XXX
program

- On-ground time

- Cycle-time
optimization

- $XXX

- Yr. 1-70%
Yr. 2-90%
Yr. 3-100%
- 100%

- Ground crew
training

- $XXX

- 100%

- Communications - $XXX
program
- Employee Stock - $XXX
Ownership Plan

- Flight is on time
- Lowest price
- Fast ground
turnaround

Target

Initiative

Budget

- 30% CAGR
- 20% CAGR
- 5% CAGR

- 30 minutes

- On-time
O ti
departure
d
t
- 90%
Strategic job
Ramp agent
Strategic systems
Crew scheduling
Ground
crew
alignment

- Develop the
necessary skills

- Strategic job
readiness

- Develop the support

system

- Info system
availability

- Ground crew aligned

with strategy

- Strategic
awareness
- % ground crew
stockholders

- 100%

- Crew scheduling - $XXX

$
system rollout

Source: Strategy Maps, by Robert S. Kaplan & David Norton

25

COMPONENTS OF
THE BALANCED SCORECARD FRAMEWORK
Strategic Theme
Operating Efficiency

Learrning

Internal

Custom
mer

Fina
ancial

Strategy
gy Map
p
Profits and
RONA
Grow
Revenue

Fewer
Planes

Objective

Measure

Target

Initiative

What the
strategy is
trying to
achieve

How
performance
against the
objective is
monitored

The level of
performance
of rate of
improvemen
t needed

Processes
and programs
required to
reach the
target

Attract & Retain

More Customers
On-time
Service

Lowest
prices

Fast ground
turnaround

Balanced Scorecard
Objective Measure Target
Fast ground
turnaround

On Ground Time

30 Minutes

On-Time Departure 90%

Action Plan
Initiative Budget
Turnaround Cycle $ xxx
Time Optimization

Ground crew
g
alignment

26

UNDERSTANDING
FINANCIAL PERSPECTIVE

27

THE FINANCIAL PERSPECTIVE PROVIDES THE

TANGIBLE DEFINITION OF VALUE
Financial
Perspective

Long-Term
Shareholder
Value

Short Term

Long Term
Productivity Strategy

Improve Cost
Structure

Reduce cash expenses

Eliminate defects;
improve yields

Increase
Asset
Utilization

Manage capacity from

existing assets
Make incremental
investments to
eliminate bottlenecks

Growth Strategy

Expand
Revenue
Opportunities

New sources of
revenue (new
products, markets,
partners)

Enhance
Customer
Value

Improve profitability of
existing customers

28

MEASURING STRATEGIC
FINANCIAL THEMES

Growth
G

Busiiness Un
nit Strate
egy

Strategic Themes
Revenue
Growth & Mix

Cost Reduction/
Productivity
Improvement

Asset
Utilization

Sales growth rate by segment

Percentage revenue from new
product, services, and customers

Revenue/Employee

Investment (percentage of
Sales)
R&D (percentage of sales)

Share of targeted customers and

accounts
Cross-selling
Percentage revenues from new
applications
Customer and product line
profitability

Cost versus competitors

Cost reduction rates
Indirect expenses
(percentage of sales)

Working capital ratios (cashto-cash cycle)

ROCE by key asset categories
asset utilization rates

Customer and product line

profitability
Percentage unprofitable
customers

Unit costs (p
(per unit of
output, per transaction)

Payback
Throughput

29

FINANCIAL PERSPECTIVE:
LIMITATIONS
Measures only tangible assets, and
ignore intangibles:
Intellectual
I t ll t l property?
t ?
Customer base and loyalty?
Brand image?
Future investments (better service, higher quality, people development)
are seen as costs
Foster short term improvements at the expense off long term strategy
Easy to be manipulated
Budgeting System is functional
functional vs crossfunctional
cross functional process
performance

30

UNDERSTANDING CUSTOMER
PERSPECTIVE

31

THE CUSTOMER PERSPECTIVE CORE MEASURES

Market Share
HARVEST

GROWTH
Customer
Acquisition

Customer
Profitability

Customer
Retention

Customer
S if i
Satisfaction
Product Leadership
p

VALUE
PROPOSITION

Operational Excellence
Customer Intimacy
32

BUILDING THE STRATEGY MAP:

STRATEGY PROPOSITION
Operational Excellence Strategy
Product/Service Attributes
Price

Quality
y

Relationship
Time

Selection

Image

Quality and selection in key categories with

unbeatable prices

Brand

Smart
Smart
Shopper

Customer Intimacy Strategy

Product/Service Attributes

Relationship

Service

Image
Relationships

Personal service tailored to

produce results for
customer
t
and
d build
b ild
long-term relationships

Brand

Trusted
Shopper
Shopper

Adapted from: The Strategy Focused Organization Robert S. Kaplan, David P. Norton

33

BUILDING THE STRATEGY MAP:

STRATEGY PROPOSITION
Product Leadership Strategy
Product/Service Attributes

Relationship
Time

Functionality

Image

Unique products and

services that push the
envelope

Brand

The Best
Product

Differentiator

General
Requirement

Adapted from: The Strategy Focused Organization Robert S. Kaplan, David P. Norton

34

SAMPLE OF MEASURES:
CUSTOMER
Market share:

Overall
By product,
product Regions,
Regions Target Market
Market, etc

Retaining customers:

% of repeat customers
% of sales growth by repeat customers

Acquiring customers:

Number of new customers

Sales from new customers
Conversion Rate

Customer satisfaction index

Corporate/ Brand awareness, image

35

SAMPLE OF MEASURES:
C S O
CUSTOMER
(Contd)

Number of customers
Market share (%)
Annual sales/ customer ($)
Average Customer Size ($)
$
Customers lost (No. or %)
New customers/ total customers (%)
( )
Customer satisfaction index
Average Time spent on Customer Relations (No.)
Sales closed/ sales contacts (%)
Cost per customer ($)
Number of complaints (no.)
Customer/ sales employee (%)
Brand Image Index

36

UNDERSTANDING INTERNAL
BUSINESS PROCESS
PERSPECTIVE

37

IDENTIFYING STRATEGIC
INTERNAL BUSINESS PROCESSES
Strategy

Innovation
Processes

Product
Leadership

Customer
I ti
Intimacy

Operational
Excellence

Invention
Product
Development
Exploitation
(speed to market)
a et)

Customer
Management
Processes

Operational
Processes

Solution
Development
Customer
Service
Relationship
management
Advisory Services

Supply Chain
Management
Operations
Efficiency: Cost,
Quality, Cycle Time
Capacity
management

Strategic Practices

Meet Basic Requirements

Adapted from: The Strategy Focused Organization Robert S. Kaplan, David P. Norton

38

SAMPLE OF MEASURES:
INTERNAL BUSINESS PROCESS
Innovation:
Percentage of sales from new products/designs
Cycle time from product concept to market
R&D
& Expenditures (total
(
or percentage off sales))
Break even time in R&D
Number of new patents/designs
Operations:
Timeliness
Quality (Scrap, product rejects, defects, rework, yields)
Completeness
Cycle time
Manufacturing Cycle Effectiveness (MCE): Processing time divided by
throughput time (which consist of processing, inspection, movement, and
waiting/ storage time)
Customer relationship management:
Sales effectiveness (hit rate, number of sales proposals, sales visits, etc)
Response
R
Ti
Time/Cycle
/C l Ti
Time
Service Failure Index
Frequency of Business Review, No. of client gatherings
Good Corporate Governance indicators (GCG Rating
Rating, Audit Findings)
Environment, Health, and Safety indicators (Freq and Cost of Accidents)
39

LEARNING AND
GROWTH PERSPERCTIVE
(FUTURE)

40

AT THE END OF THE DAY, YOU

BET ON PEOPLE
PEOPLE, NOT ON
STRATEGIES. STRATEGIES ARE
INTELLECTUALLY SIMPLE,
SIMPLE THEIR
EXECUTION IS NOT. YOUR
STRATEGIES WILL NOT MAKE
YOU A BETTER COMPANY.

Allied Signal CEO: Lawrence Bossidy

41

LINKAGE OF
JOB SATISFACTION AND REVENUE
A Compelling
Place to Work

A Compelling
Place to Shop

Attitude
About the
Job

Service
Helpfulness

Employee
Behavior

Attitude
About the
Company
5-Unit
Increase in
Employee
p y
Attitude

Employee
Retention

Drives

A Compelling
Place to Invest

Customer
Recommendations

Customer
Impression

Merchandise
Value

1.3-Unit
Increase in
Customer
Impression

Return on Assets
Operating Margin
Revenue Growth

Customer
Retention

Drives
es

0.5-Unit
Increase
in Revenue
Growth
42

LEARNING AND GROWTH PERSPECTIVE

Reflect strategy in learning and growth
Consists
C
i t off three
th
principal
i i l categories:
t
i
Human Capital
Information Capital
Organization Capital
People aspect in Balanced Scorecard

43

LEARNING & GROWTH MEASUREMENT

FRAMEWORK
Core Measurements
Results

Employee
Retention

Employee
Productivity

Employee
Satisfaction
Enablers
Staff
Competencies

Technology
Infrastructure

Climate for
Action
44

SAMPLE OF MEASURES:
LEARNING AND GROWTH
Employee
p y Satisfaction Index
Turn-over rate: Voluntary and In-voluntary
Employee productivity
Revenue per employee
Revenue per employee compensation

Training:
Investment: Total amount, Percentage of employee costs (or revenue)
Training days per employee
Coverage

Impact on competency: Human Capital Readiness Index

Climate:
Number of complaints
Number of employee suggestions
Climate surveys (link to Employee Satisfaction Survey)

IT/MIS Indicators (network,

(network downtime,
downtime no.
no applications)
45

THREE TYPES OF
STRATEGY MAP TEMPLATES:
OPEX, CUST INTIMACY,
PRODUCT LEADERSHIP

46

LINKING VALUE PROPOSITION

TO STRATEGY
Customer Value
Proposition

Product Leadership
Excellent Product
Speed to Market
Microsoft
Intel
Sony
Nike
Nik

Ope at o a Excellence
Operational
ce e ce
Low Costs, High-Quality
Excellent Service
Carrefour
Dell
Daihatsu
Postal Office

Customer Intimacy
Customization
Deep, Long-Term
Relationship
Levi-Strauss
DHL
Xerox

* Adapted from Competing in the Third Wave by Hope & Hope

47

Sustainable, increased shareholder value

Increased Revenue

Efficiency Management

Rev from
New Market/Products

Custome
er
Perspec
ctive

Fina
ancial
Pers
spective

GENERIC STRATEGY MAP:

Aligning Value Chain and Customer Value Proposition

Rev from Existing Market/

Products

Optimum Asset Utilization

Current
Fixed

Efficient Cost

Market Share
Customer Acquisition

Customer Loyalty
Product Leadership
Value Proposition:
Cutting edge products
First to market

Customer Intimacy
Value Proposition:
Customized solutions
Intimate relationship

Operation Excellence
Value Proposition:
Low cost
Speed and wide selections

Learnin
ng &
Growth
h
Perspe
ective

Internal
ve
Perspectiv

Value Chain:

Develop

Produce

Sell

Deliver

Serve

Collect

EHS

Productive workforce driven by Human, Organization and Information Capital

Competent workforce
aligned to strategy

Great organization and

Climate that support
strategy

World-class ICT
that enhance strategic
capabilities
48

Sustainable, increased shareholder value

Increased Revenue

Efficiency Management

Rev from
New Market/Products

Custome
er
Perspec
ctive

Fina
ancial
Pers
spective

GENERIC STRATEGY MAP

for PRODUCT LEADERSHIP

Rev from Existing Market/

Products

Market Share
Customer Acquisition

Customer Loyalty
Product Leadership
Value Proposition:
Cutting edge products
First to market

Learnin
ng &
Growth
h
Perspe
ective

Internal
Perspectiv
ve

Value Chain:
Develop

Produce

Innovative product
development

Flexible
processes

Sell and market

new products

Production
innovation

Educate the
market

Management of research
capabilities

Sell

Deliver
Create new
Channels

Serve
Gain customer
ideas

First to market
49

Sustainable, increased shareholder value

Increased Revenue

Efficiency Management

Rev from
New Market/Products

Custome
er
Perspec
ctive

Fina
ancial
Pers
spective

GENERIC STRATEGY MAP

for OPERATIONAL EXCELLENCE

Rev from Existing Market/

Products

Optimum Asset Utilization

Current
Fixed

Efficient Cost

Market Share
Customer Acquisition

Customer Loyalty

Operation Excellence
Value Proposition:
Low cost
Speed and wide selections

Learnin
ng &
Growth
h
Perspe
ective

Internal
Perspectiv
ve

Value Chain:
Develop
Low cost
product
d t
development

Sell

Produce
Low cost supply
management

Efficient
order taking

Efficient production:
Good quality, high yield,
minimum lost

Deliver

Collect

Low-cost
distribution

Collect timely

Deliver in full,
On time

EHS
Minimum
Environmental
costs

Bad-debt
management

Minimum
return
50

Sustainable, increased shareholder value

Increased Revenue

Efficiency Management

Rev from
New Market/Products

Custome
er
Perspec
ctive

Fina
ancial
Pers
spective

GENERIC STRATEGY MAP

for CUSTOMER INTIMACY

Rev from Existing Market/

Products

Optimum Asset Utilization

Current
Fixed

Efficient Cost

Market Share
Customer Acquisition

Customer Loyalty
Customer Intimacy
Value Proposition:
Customized solutions
Intimate relationship

Learning &
Growth
h
Perspe
ective

Internal
Perspectiv
ve

Value Chain:
Develop
Create new
Services/
solutions

Produce
Customized
production
p
y
capability

Sell

Deliver

Serve
Intimate
relationship

Taylor-made
solutions
Flexible, taylorFlexible
taylor
made delivery
Intensive contacts

Develop customer
Knowledge/database
Taking extra
miles
51

COMPONENTS OF
THE BALANCED SCORECARD FRAMEWORK
Strategic Theme
Operating Efficiency

Learn
ning Interrnal

C
Customer

Financial

Strategy Map
Profits and
RONA
Grow
Revenue

Fewer
Planes

Objective

Measure

Target

Initiative

Whatt the
Wh
th
strategy is
trying to
achieve

How
H
performance
against the
objective is
monitored

The level
Th
l
l off
performance
of rate of
improvemen
t needed

Processes
P
and programs
required to
reach the
target

Attractt & Retain

Att
R t i
More Customers
On-time
Service

Lowest
prices

Fast ground
turnaround

Balanced Scorecard
Objective Measure Target
Fast ground
turnaround

On Ground Time

30 Minutes

On-Time
On
Time Departure 90%

Action Plan
Initiative Budget
Turnaround Cycle $ xxx
Time Optimization

Ground crew
alignment
52

THREE TYPES OF KPI

53

GUIDELINES IN SELECTING A KPI

KPI must be well-defined and doesnt lead to ambiguity or
multi interpretations.
interpretations
KPI must be as SMART as possible: Specific, Measurable,
Agreeable, Realistic, and Timebound.
KPI must have data that can be acquired on regular basis.
KPI must measure areas that are within our influence (in
some cases,, when level of influence is very
y low y
yet attention
is needed, the indicator is called: monitoring KPIs which
would have 0% weighting).
Limit the total number of KPIs at a reasonable level.
level
Typically, at the Company level you may have between 1530 KPIs, and at Departmental Level, you may have around
10 to 15 KPIs.
KPIs
The cost to identify or to monitor a KPI should not exceed the
value gained from the measurement of the KPI.

54

GUIDELINES IN SELECTING A KPI

OK KPIs:

Better KPIs:

Employee Turnover Rate

Percentage of Employee
Turnover per Semester
Tonnes of production per
hour
Average days of product
delivery
y to customers per
p
month (from PO date to
product arrival at
customer site)

Production Productivity
Delivery Lead Time

55

WE NEED TO BE AWARE OF THE GAP BETWEEN WHAT WE

MEASURE AS OUR KPIs AND WHAT WE ASPIRE TO AS OUR
STRATEGIC OBJECTIVE

Exact KPIs All Aspects of the Objective Are Measured

KPI

Objective

Proxy KPIs Limited Aspects of the Objective Are Measured

KPI

Size of Gap

Objective

Activity/Initiative KPIs Inputs or Efforts

KPI

Size of Gap

Objective
56

EXACT MEASURES
COVER ALL THE ASPECTS OF THE STRATEGIC
OBJECTIVE THEY ARE COMPREHENSIVE

Financial Measure

Customer Measure

Strategic Objective:
Good Budget
Management

Strategic Objective:
High
g Customer
Satisfaction

Exact KPI:
% Deviation of expense
budget

Exact KPI:
Customer Satisfaction
Index from a Survey

Target:
within 5% of Budget

Target:
More than 80%

57

PROXY KPIs MEASURE LIMITED ASPECTS

OF THE STRATEGIC OBJECTIVE; ACTIVITY KPIS
MEASURE EFFORT
Customer Measure
Strategic Objective:
High
g Customer Satisfaction
Proxy KPI:
Customer Complaints

Activity/Initiative KPI:
Number of Customer
Gatherings
Target:
1 per month

Target:
Less Than 5 per month

58

TARGET SETTING
FORECAST: Possible achievement considering companys internal and external factors.
TARGET: Challenging, stretched objectives to drive organization growth

Pe
erforman
nce

100%
Dinamika Eksternal
dan Internal

50%

% di atas
Baseline

10%

59

GUIDELINES FOR TARGET SETTING

Be SMART-C:
SMART C:
S pecific
M easurable
A greeable (between you and superior/team)
R ealistic
li ti ((achievable,
hi
bl yett challenging)
h ll
i )
T ime-bound
C ONTINUOUSLY IMPROVE
e c a aga
against:
s
Benchmark

Average Last year

Best three-month (or month) performance

Best in field

B t in
Best
i industry
i d t
Consider other external and internal factors:

Market growth
p

Internal capabilities

Vertical and cross-functional target alignment

GREAT companies are characterized by
BHAG - Big
Bi H
Hairy
i A
Audacious
d i
G
Goals
l (B
(Built
ilt to
t last,
l t Collins
C lli and
d Porras,
P
1990)
60

GUIDELINES FOR FIRST TIME

TARGET SETTING
Performance
Evaluation
Guideline
1

Little or No
Experience
With the KPI

Much
E
Experience
i
With the KPI

Target is
Crystal Ball

Encourage
Learning about
the KPI and Target

Target is
Achievable

Hold People
Accountable for
Poor Performance

Target is
Unrealistic

Develop preliminary
Business Plans
before Setting
the Target
61

KPI MANUAL

62

KPI MANUAL

LEMBARAN INDIKATOR KINERJA STRATEGIS

Corporate Balanced Scorecard
Perspektif

MEMENUHI HARAPAN STAKEHOLDER : STRATEGIC OUTCOME

Sasaran Strategis

Alokasi belanja negara yang tepat sasaran, tepat waktu, efisien, dan adil

Deskripsi Sasaran Strategis

1. Alokasi belanja negara yang tepat sasaran adalah alokasi anggaran yang dapat mencapai kinerja program dan kegiatan
kementerian negara/lembaga yang telah ditetapkan dalam APBN.
2. Alokasi belanja negara yang tepat waktu adalah pengesahan DIPA yang dapat diselesaikan sesuai jadwal yang ditetapkan.
3 Alokasi belanja negara yang efisien adalah penuangan anggaran pada DIPA yang dapat digunakan untuk mendukung
3.
pencapaian sasaran yang ditetapkan.
4. Alokasi belanja negara yang adil adalah alokasi belanja negara yang proporsional sesuai dengan pioritas Rencana Kerja
Pemerintah.

Indikator Kinerja Utama 1.1 :

Jumlah dokumen alokasi belanja pusat dan dana transfer ke daerah tepat waktu (Sub KPI : K/L dan Pemda)

Deskripsi:

Definisi:
1. Dokumen alokasi belanja pusat adalah DIPA kementerian negara/lembaga yang telah disahkan berdasarkan hasil penelaahan
1
antara Ditjen Perbendaharaan dengan kementerian negara/lembaga.
2. Dokumen alokasi dana transfer ke daerah adalah DIPA terkait dengan dana perimbangan yang telah disahkan berdasarkan
hasil penelaahan antara Ditjen Perbendaharaan dengan Ditjen Perimbangan Keuangan.
3. Tepat waktu adalah penyelesaian pengesahan DIPA sesuai dengan jadwal yang ditetapkan.

SAMPLE OF
DETAILED
KPI FORMS

Pengalokasian dana transfer ke daerah dalam rangka pemerataan keuangan antara Pusat dan daerah dan antar daerah melalui
perumusan kebijakan, pengalokasian, koordinasi dan fasilitasi, perhitungan alokasi, standardisasi, dan bimbingan teknis di bidang
belanja untuk daerah secara tepat waktu,
waktu tepat sasaran,
sasaran efektif
efektif, efisien
efisien, adil proporsional
proporsional, dan akuntabel
akuntabel.
Formula
Jumlah DIPA seluruh K/L dan Pemda - Jumlah DIPA yang disahkan pada 31 Desember

% Pencapaian Target Penyelesaian DIPA =

Realisasi Penyelesaian DIPA

--------------------------------------- X 100%
Target Penyelesaian DIPA

Tujuan Strategis:
KPI ini bertujuan untuk menjamin kelancaran pelaksanaan APBN

Satuan Pengukuran:

Persentase

P
Person
in
i Charge:
Ch

Di k JJenderal
Direktur
d lP
Perbendaharaan
b d h

Sumber Data:

DJA

Tindakan apabila data belum tersedia:

Ditjen Perbendaharaan, kementerian negara/lembaga, Pemerintah Daerah

Polarisasi Indikator Kinerja:

Maximize

P i d Pelaporan:
Periode
P l

T h
Tahunan

Jumlah dokumen alokasi belanja pusat

dan dana transfer ke daerah tepat waktu
(Sub KPI : K/L dan Pemda)
Th 2008

2007
(Baseline)
100%

2008
100%

63

Field
Perpektif

Indikator Kinerja
j
Deskripsi

DEFINITION
OF FIELDS
CONTENT

Satuan Pengukuran
Person in Charge
Sumber Data:
Tindakan apabila data
belum tersedia:
Polarisasi

Periode Pelaporan
p

Deskripsi
Tuliskan nama perspektif Balanced Scorecard di mana Indikator Kinerja
tersebut berada. Awali nama Perspektif dengan nomor urut yang sesuai.
Mi l 1
Misal:
1. Fi
Financial
i l
2. Customer
3. Internal Business Process
4. Learning and Growth
Tuliskan nama indikator kinerja
j dan diawali dengan
g nomor urut sesuai
dengan urutannya dalam perspektif
Berisikan uraian mengenai Indikator Kinerja yang mencakup:
- Definisi: uraian mengenai apa yang dimaksud dengan Indikator Kinerja
- Formula: uraian bagaimana data untuk Indikator Kinerja tersebut
diperoleh Hanya diisi jika Indikator Kinerja merupakan hasil kalkulasi dari
diperoleh.
beberapa variabel atau sub KPI.
- Tujuan: uraian mengenai alasan dimasukkannya Indikator Kinerja tsb.
dalam Balanced Scorecard
Unit yang digunakan untuk menunjukkan kuantitas Indikator Kinerja,
misal %, Rp, USD
Individu yang accountable terhadap pencapaian Indikator Kinerja
Sumber dari mana data untuk KPI ini diperoleh
Apabila sumber data belum ada, tuliskan tindakan untuk dapat
memperoleh data tersebut
Menunjukkan ekspektasi arah nilai aktual dari KPI dibandingkan relatif
terhadap nilai target:
- Maximize: Nilai aktual/realisasi/pencapaian Indikator Kinerja diharapkan
lebih tinggi dari target
- Minimize:Nilai
Mi i i Nil i aktual/realisasi/pencapaian
kt l/ li
i/
i IIndikator
dik t Ki
Kinerja
j dih
diharapkan
k
lebih kecil dari target
- Stabilize: Nilai aktual/realisasi/pencapaian Indikator Kinerja diharapkan
berada dalam suatu rentang nilai tertentu
Menunjukkan
j
seberapa
p sering
g data aktual Indikator Kinerja
j p
perlu
dikumpulkan (bulanan, triwulanan, semesteran, tahunan)

Pada Tabel diisikan target yang ingin dicapai menurut periode pengukuran dan polarisasinya.
64

PITFALLS IN BSC IMPLEMENTATION

JUST REPORTING AND MEASURING
BURUK MUKA, CERMIN DIBELAH SYNDROME
KPI GAME
NO LINKAGE TO REWARD SYSTEMS
LACK OF LEADERSHIP COMMITMENT
SIGNS OF KPI GAMING
ONLY EASY MEASURES ARE BEING REPORTED Mainly
activity measures
TARGETS ARE ARTIFICALLY SET LOW Making them easy
to achieve and show Green Traffic Lights

65

Ive always
y been in the right
g p
place at the right
g
time. Of course, I steered myself there.
BOBHOPE(1903 )

66