Understanding and Implementing CMZ BSC - 2014 Edition

Understanding and Implementing
CMZ Balanced Scorecard
(CMZ BSC)
What is it?
How to Implement?
(Formulating, monitoring, and reporting)
2014 Edition
Reynaldo O. Joson, MD
October 9, 2009 (Creation Date)

CMZ Balanced Scorecard
(CMZ BSC)
General Objective of Learning Material:
To orient and train staff on the CMZ Balanced Scorecard
Program (with focus on what is the balanced scorecard and
how to formulate, monitor, and report it.)

Understanding and Implementing CMZ BSC
Contents
• What is a balanced scorecard (BSC)? CMZ BSC?
• What is the template being used in CMZ BSC?
• Why is BSC called “balanced”?
• What are the guide questions to answer the 5 perspectives of BSC?
• What are the ultimate outcomes of the 5 perspectives of BSC?
• Major categories of CMZ BSC

Contents
• BSC framework being used in CMZ
• The different function level scorecards
• The contents of BSC
• Tabular presentations of BSC – Main BSC and Action
Registers / Plans
• Operational definitions of terms used in BSC

Contents
• History of CMZ BSC
• Policies on CMZ BSC (2013 onwards)
• How to implement the BSC – for CMZ BSC
• How to implement the BSC – for Unit BSC
• How to implement the BSC – for Individual BSC

CMZ BSC
What is a balanced scorecard (BSC)?
• A blueprint
– formulated by an organization to be used as a guide
and reference for
• implementation of strategies and tactical objectives
• monitoring
• evaluation of actions taken
– not only a management strategic tool but also a
performance measurement system
– links strategies to action

CMZ BSC
What is the CMZ balanced scorecard (BSC)?
• A blueprint
– formulated by CMZ to be used as a guide and reference
for
• implementation of strategies and tactical objectives
• monitoring
• evaluation of actions taken
– not only a management strategic tool but also a
performance measurement system
– links strategies to action

CMZ BSC
What is the template being used in CMZ BSC?
• Template popularized by Robert Kaplan and David
Norton around 1990
• Scorecard with four perspectives:
• Financial
• Customer
• Process
• Learning and growth
• CMZ BSC – 5 perspectives [added Corporate Social
Responsibility (CSR) as 5th
perspective]

CMZ BSC
Perspectives terminology used in 2009 (for 2010-2012):
• Financial
• Customer
• Process
• Learning and growth
• Corporate social responsibility
Perspectives terminology used in 2012 (for 2013-2015):
• Governance, Service, and Finance
• Customer
• Process
• Learning and growth of people
• Corporate social responsibility

CMZ BSC
Why is the BSC called “balanced” ?
Because it considers ALL factors
(the 5 perspectives),
not just the financial factor as is commonly done in
business organizations,
which are important in achieving the vision-mission of an
organization.

CMZ BSC
Why is the BSC called “balanced” ?
Using the five perspectives of
- governance, service and finance
- customer
- process
- learning and growth
- CSR
which are both tangible and intangible assets of an
organization,
makes for the balance of the scorecard.

CMZ BSC
Governance, service, and
finance –
To succeed (financially or
otherwise), how should we
appear to our shareholders or
owners?
Customer –
To achieve our vision, how should
we appear to our customers?
Process –
To satisfy our shareholders (or
owners) and customers, what
processes must we excel at?
Learning and growth of people –
To achieve our vision, what
competencies should the
organization have and how will
we sustain our ability to change
and improve?
To determine what to place in each perspective in the balanced
scorecard, guide questions are used.

CMZ BSC
CSR –
To achieve our CSR mission, how
should we appear to our
community?
To determine what to place in each perspective in the balanced
scorecard, guide questions are used.

CMZ BSC
The ultimate outcomes for each perspective or category are as
follows:
Governance, service, and
finance perspective –
satisfied shareholders
Customer perspective –
delighted customers
Process perspective –
effective and efficient processes
Learning and growth of people
perspective –
competent and engaged
workforce
CSR perspective –
corporate citizen

CMZ BSC
Governance, service, and finance
perspective –
To succeed (financially or
otherwise), we must have
satisfied shareholders
Customer perspective –
To achieve our vision, we must
have
delighted customers
Process perspective –
To satisfy our shareholders (or
owners) and customers, we must
have
effective & efficient
processes
Learning and growth of people
perspective –
To achieve our vision, we must
have
competent and engaged
workforce
Integrating the guide questions and ultimate outcomes in
each perspective or category -

CMZ BSC
CSR perspective –
To achieve our CSR mission, we must be
a corporate citizen
Integrating the guide questions and ultimate outcomes in
each perspective or category -

CMZ BSC
2 Major Categories:
1. Whether the BSC is based on strategic or
operational objectives (strategic objectives are
general and longer-term, usually three years;
operational objectives are more specific and
shorter-term, basically one year)
2. Whether the BSC is made for the whole hospital
(corporate); for a particular unit or section in the
hospital (department or unit); or for
an individual staff.

CMZ BSC
What is the BSC framework being used in CMZ?

CMZ BSC Framework
Business & Organizational
Milestones / Targets
Vision - Mission
Alternative Strategic Intents
Prioritize and align
through BSC Process
Translate to Function Level Scorecards (CMZ , Unit, Staff)
Desired
Outcomes
Drivers
Corporate
Balanced
Scorecard
Governance, Service,
Finance Perspective
Satisfied Shareholders
Customer Perspective
Delighted Customers
Process Perspective
Effective & Efficient
Processes
Learning and Growth of
People Perspective
Competent & Engaged
Workforce
CSR Perspective
Corporate Citizen

CMZ BSC Framework
Translate to Function Level Scorecards (CMZ, Unit, Staff)
CMZ or Corporate BSC
– formulated by the Top, Senior, and Middle Management
Team.
Unit BSC
– formulated by all medical or non-medical specialty
units in the hospital (offices, divisions, departments,
services) cascaded from / guided by the CMZ BSC.
Staff BSC
– formulated by an individual CMZ staff on how he/she
will contribute to the unit or CMZ BSC.

CMZ BSC Framework
Contents of BSC
• Perspectives (5)
• Goals (Strategic Intent – General Objectives)
• Tactical Objectives (Specific Objectives – Key Result
Areas)
• Performance Measures: Outcome and Target (Key
Performance Indicators)
• Initiatives (Programs, Projects, Tasks, Activities)
• Action Registers / Action Plans of Initiatives
• Resources / Budget
• Timetable (Timelines or Gantt charts)
• Person-in-Charge (Champions, Task Forces)

CMZ BSC Framework
Tabular Presentations of BSC
• The Main BSC
 With identification of “Initiatives”
 With performance data and analysis
• The Action Registers / Plans of the Initiatives
 Action registers / plans of programs / projects /
tasks / activities (with design and development plans)

CMZ BSC Framework
Tabular Presentation of the Main BSC
(Scorecard with identification of “Initiatives”)
Perspective Goals
(Strategic
Intent –
General
Objectives)
Tactical
Objectives
(Specific
Objectives
– Key
Result
Areas)
Performance
Measures:
Outcome
/Target
(Key
Performance
Indicators)
Initiatives
(Programs,
Projects,
Tasks,
Activities)

CMZ BSC Framework
Tabular Presentation of the Main BSC
(Scorecard with performance data and analysis)
Perspective Goals
(Strategic
Intent –
General
Objectives)
Tactical
Objectives
(Specific
Objectives
– Key
Result
Areas)
Performance
Measures:
Outcome
/Target
(Key
Performance
Indicators)
Status
(Q1/Q2/Q3/Q4)
Data:
Analysis:
Variance -
achieved / NOT
achieved
Causes and
corrective
actions for
negative
variances

CMZ BSC Framework
Tabular Presentation of Action Register / Plan of Initiatives
(Programs / Projects / Tasks / Activities)
Objectives
(KRAs)
Performance
Measures: Outcome
/Target
(KPIs)
Resources Timelines Person-in-
charge
*Should be accompanied by a systematic design and development plan.

CMZ BSC Framework
Operational Definitions of Terms
Perspective:
Governance, Service, and Finance – leadership, key service offerings,
business development and financial management.
Customer – external and internal stakeholders.
Process – the way of doing things to satisfy the owners and customers.
Learning and Growth of People – staff or workforce development, training
and education involving everybody, from top and senior management team
down to personnel (rank and file).
CSR – corporate citizenship of CMZ and its staff.

CMZ BSC Framework
Goals and Objectives
Goals – general strategic intent (general objectives)
Objectives – tactical or more specific objectives for the general
strategic intent or key result areas for programs, projects, and tasks.
Key Results Areas (KRA) – essential steps that will reflect
accomplishment of the programs, projects and tasks, in the most
efficient way possible.
Key Performance Indicators (KPI) – essential measures (with
specified targets) of accomplishment of KRAs.

CMZ BSC Framework
Initiatives – formulated programs, projects, tasks, and activities that
will be needed or will be used to achieve objectives.
Programs – a package of initiatives that includes at least two
distinct, extensive, and interrelated projects.
Projects – a package of initiatives that includes at least two distinct,
extensive, and interrelated tasks.

CMZ BSC Framework
Initiatives – Formulated programs, projects, tasks, and activities that
will be needed or will be used to achieve objectives.
Programs –
Projects –
Tasks – may be classified into two types - activities which may be
common or run-of-the-mill in which case the word “activities” is
used (see below) and activities which may be special or distinct in
which a label may be used, if deemed necessary.
Activities – Generic or run-of-the-mill tasks that need no special
name to identify them; examples of generic tasks are “to implement
policies and procedures”, “to evaluate their implementation,” etc.

CMZ BSC Framework
Resources – external and internal resources needed to accomplish
objectives or key result areas in terms of man, method, material, and
machine. As much as possible, with peso equivalent of resources.
Timetable – as much as possible, targeted month and year of
completion, if not the specific date. Quarter of the year may be
placed as time for completion, especially for programs and projects.
Gantt charts which are tabular presentations of the timelines may be
used.
Persons-in-Charge – may be an individual or group of individuals or
task force.

History of CMZ BSC
• Initiated in October, 2009 by the Top, Senior, and Middle
Management Team (during the 1st
CMZ formal strategic
planning conference) to be used as primary management
strategic and measurement tool
• Envisioned to be useful in serving as
- communication
- deployment
- alignment
- collaboration
- monitoring
- evaluation tool
in the implementation of strategic objectives of CMZ.

Policies on CMZ BSC (2013 Onwards)
• A balanced scorecard shall be used as a
management as well as a performance evaluation
tool in Ciudad Medical Zamboanga.
• There shall be a hospital or corporate balanced
scorecard which shall be formulated by the Top,
Senior, and Middle Management Team.

• A standardized balanced scorecard template shall
be used in CMZ and by all units required to have
one.
• All units except committees shall have a balanced
scorecard which shall be aligned to the hospital or
corporate balanced scorecard.

• There shall be an annual formulation, quarterly
progress report, and a year-end report on the
hospital and unit balanced scorecards.

• The Task Team Corporate Planning shall be the
unit in charge of coordinating and monitoring the
balanced scorecard of the hospital.

How to Implement the BSC
Use the CMZ BSC framework and policies as guides
in
formulating,
monitoring, and
reporting
the BSC (CMZ, Unit, and Staff).

(formulating, monitoring, and reporting)
For CMZ / Corporate BSC

For CMZ / Corporate BSC –
• The Management Team (top, senior and middle
management) shall formulate the CMZ BSC for the
year during the annual planning conference.
• The CMZ BSC shall be formulated in consideration
of the latest strategic plan, annual business plan
and targets for the year.

• The formulated CMZ BSC for the year shall be
presented to the Board of Directors for approval.

• The CMZ BSC for the year approved by the Board
of Directors shall be presented to all the staff by
the President /CEO not later than the last week of
November. Such presentation shall facilitate
communication, deployment, alignment, and
collaboration in the implementation of strategic
objectives by all units of CMZ.

• The Task Team Corporate Planning shall collate all
data from unit BSCs to come out with quarterly
monitoring and year-end report on the CMZ BSC.

For Unit BSC
(Departments and Sections)

For Unit BSC (Departments and Sections) –
• The Heads shall formulate the Unit BSC for the
year during the annual planning conference of the
unit.
• The Unit BSC shall be formulated in consideration
of the CMZ’s and unit’s latest strategic plan, unit’s
annual business plan and targets for the year.

• The formulated Unit BSC for the year shall be
presented to a higher office for approval.

• There shall at least be a quarterly and an end-of-
year reporting of Unit BSCs to a higher office.

Steps in formulating a Unit BSC

Steps in formulating a Unit BSC:
– Take hold of the CMZ BSC.
– Identify goals and tactical objectives in the five
perspectives of the CMZ BSC which are pertinent to
your unit and in which you are expected to contribute.
– Include these goals and tactical objectives in your unit
BSC.

– Add other goals and tactical objectives which are
relevant to your unit’s authorized functions.
– Set the performance targets of the chosen tactical
objectives for your unit, having in mind you are
expected to contribute to the attainment of targets set
in the CMZ BSC.

– Identify the program/project/tasks/activities you will
institute to achieve the tactical objectives.
– Present your unit BSC to a higher office.
– Your approved BSC will serve as your performance
monitoring and evaluation tool or card for the year.

For Individual BSC

For Individual BSC –
• Every staff (CMZ managers, medical staff, and rank
and file) shall formulate an Individual BSC for the
year during the annual planning conference of the
unit.

• The Individual BSC shall be formulated in
consideration of the unit’s annual business plan
and targets for the year.

• The CMZ BSC shall automatically constitute the
Individual BSC of the President / CEO.
• The Unit BSC shall automatically constitute the
Individual BSC of the heads of units.

• Every staff other than the President / CEO and
heads of units shall formulate his / her Individual
BSC signifying his / her pledge / contribution to
the Unit BSC for the year.

• The formulated Individual BSC for the year shall be
presented to a concerned unit head for approval.
• There shall at least be a semi-annual and annual
reporting of Individual BSC to a concerned unit
head.

• All unit heads shall monitor the Individual BSCs
and use them as management tool and
performance evaluation.

Steps in formulating an Individual BSC

Steps in formulating an Individual BSC:
– Take hold of your unit BSC.
– Identify tactical objectives in the five perspectives of
your unit BSC in which you should and can contribute.
– Set the performance targets of the chosen tactical
objectives.

Steps in formulating an Individual BSC:
– Identify the program/project/tasks/activities you will
institute to achieve your tactical objectives.
– Present your BSC to your immediate superior for
approval.
– Your approved BSC will serve as your performance
monitoring and evaluation tool or card for the year.

CMZ BSC
Summary

For Coaching on CMZ BSC
See
Any member of the
Task Team Corporate Planning
or
Your Unit Head
Recommended Reading:
https://sites.google.com/site/balancedscorecardofcmz

Understanding and Implementing CMZ BSC - 2014 Edition

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