The Public Sector Balanced Scorecard

The Balanced Scorecard is a useful performance measurement tool consisting of a strategy map identifying key objectives and associated measures to track progress in achieving those objectives. However, implementing a Public Sector Balanced Scorecard has some unique challenges.

In the typical scorecard, the strategy map is divided into four perspectives: financial, customer, internal process, and learning and growth. Key organizational objectives are associated with each of these perspectives.

In the private sector, the logic of this arrangement is straightforward; organizational personnel with the right skill sets, motivation and tools will drive process quality which will lead to increased customer satisfaction and ultimately financial success.

However, in the Public Service, the 'bottom line' is not the bottom line – fiscal prudence is essential but not the reason that government programs and services exist. The bottom line is success of the mission i.e. did the program or service deliver as expected?

So an organization building a Public Sector Balanced Scorecard has to start with the understanding that the ultimate goal is an improvement in awareness, capacity or conditions for the customer (citizens.)

How To Get Started With Your Public Sector Balanced Scorecard

While a powerful tool, the Balanced Scorecard can be challenging to implement. This is especially true in the Public Sector, where measuring the ultimate success of programs is often not simple or straightforward. And trying to implement and coordinate all the perspectives of the Scorecard can strain the capacity of the organization.

If the organization takes on more of a measurement regime than can be managed, there is the risk of failure. Subsequent efforts may face an uphill battle (“we tried that and it didn't work”). So, what can we do to limit the risk and the drain on organizational resources?

First, place a hard limit on the number of measures that you propose to track for each perspective. Suggest a maximum of 5 or 6 for each perspective; no more than 20 or so for the whole organization.

Second, you don't need to implement the whole Public Sector Balanced Scorecard at once. The most important success factor in sustainability of performance reporting is embedding results-based decision-making in management practice.

In other words, the organization has to become accustomed to collecting, analyzing and reporting performance data, and using that data to set priorities, drive decisions, and take corrective action when necessary. Creating the governance structure and communication strategy to support this process is more important than any particular measure.

Final Thoughts About The Public Sector Balanced Scorecard

Despite the fact that the purpose of the organisation is to serve a customer, this might not be the best perspective to start measuring first. As stated, measuring results (impacts, benefits, consequences) of public sector programs can be challenging. Starting with a perspective that is more under control of the organization might make the process easier to implement and manage.

We recommend considering the learning and growth perspective as your starting point. Identify the key objectives from this perspective – e.g. attract/develop a highly-skilled workforce, maintain the morale and motivation of our personnel, create a learning, knowledge-based organization that values innovation – and craft a handful of measures that reflect success in achieving these objectives. Once the process of performance reporting has been well-established, add more perspectives.

See Also:

Free Performance Measurement Guide. This Free Guide contains the information that is the basis of our successful practice in Public Sector Performance Measurement. The Guide is based on our experience working with Public Sector organizations to design, test, and implement practical Performance Reporting Frameworks.

Public Sector Performance Measurement Guide

Best Practices in Performance Measurement

Conducting a Performance Measurement Assessment

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