Acumen Strategic Management System and Acumen Scorecard Framework

Opportunities in a Time of Change

Both for profit businesses and not-for-profit organizations face a series of demanding challenges in today’s marketplace. Change is everywhere and constant. The increasing complexities of running a business or organization create many challenges for owners and managers. In most mid-sized organizations the owners or managers are involved in almost every aspect of running an enterprise. Although this approach may have worked in the past, in today’s environment, it limits growth potential and stymies competitive advantage. Today there is a need to create an entrepreneurial management framework.

An Opportunity to Improve the Strategic Planning and Execution Process

In 1992, Robert Kaplan of Harvard Business School and David Norton of Renaissance Solutions released a research report that indicated that most strategic planning processes are flawed.85% of senior management teams spend less than one hour a month discussing strategy

• 75% of executive teams do not have a clear consensus on the value proposition being offered customers
• Only 5% of the work force understand the organization’s strategy
• 60% of organizations do not link budgets to strategy
• Only 25% of managers have incentives linked to strategy
• In response Kaplan and Norton created the Balanced Scorecard (BSC) framework
• 85% of senior management teams spend less than one hour a month discussing strategy

The Balanced Scorecard (BSC)

The BSC is a performance management and measurement system that integrates both financial and non-financial measures. The BSC helps translate and align strategic vision into operational terms through the balancing of performance metrics across four different perspectives: Financial, Customer, Internal Process, and Growth & Learning. Today over half of the Fortune 500 and an ever growing number of midsize enterprises and not-for-profit organizations are using the BSC performance management system to foster growth and profitability.

The Acumen Scorecard

In today’s complex business environment strategies for creating value are shifting from just managing tangible assets to more knowledge based strategies related to deploying intangible assets including customer relationships, workforce motivation, product/service innovation, knowledge, and skills development. Building on the success of the BSC the Acumen Dynamics Framework has developed an enhanced package of practical tools and techniques to foster growth and profitability.

Creating an Entrepreneurial Management Framework

The Acumen Strategic Management System establishes a measurement and entrepreneurial management system that will channel the energies, abilities, and specific knowledge of the people and company towards achieving a series of focused strategic objectives. The Acumen Strategic Management System also helps the ownership and leadership create a management structure that clarifies and communicates the organization’s strategic direction. The system aligns employees to work towards goals that encourage efficiency and competitive advantage.

Distinct Advantages of the Acumen Scorecard Approach

The Acumen Scorecard recognizes the need to blend financial and operational measures. The approach provides leadership a set of comprehensive measures that are practical. The Acumen Scorecard focuses the business on activities critical to success and growth. It provides a snapshot of overall performance of the business which helps the leadership to organize, communicate, and measure the impact of management and strategy.

Create Value around Five Different Strategic Perspectives

The Acumen Strategic Management System builds a framework to manage strategies across five perspectives:

• Vision, Governance, and Continuity-Aligning vision, creating and modifying the course and operational direction of the enterprise for the benefit of the stakeholders and community.
• The Customer Perspective-Building strategy around improving customer value and competitive positioning.
• Internal Business Processes-Establishes priorities for business and operational processes that are critical to creating customer satisfaction and growth.
• Financial Perspective-Focuses on measures that support profitable strategic growth and business development while considering ownership risk.
• Growth & Learning-Creates an entrepreneurial climate that fosters innovation and growth through learning and change.

The Steps to Developing an Acumen Scorecard

The process of developing an Acumen Scorecard will direct leasdership to build a management system that has balance between financial and operational measures, leading and lagging measures, and vision and mission based measures that reflect the personality and needs of the company.

Employing the AcumenSMS framework will help focus tactical and strategic thinking around the following eight core competencies.

1. Building Unity, Consensus & Focus
2. Value Concept & Competitive Positioning
3. Understanding Markets & Customers
4. Operations & Customer Relationship Management
5. Aligning Core Competencies around Customer Needs
6. Communication & Empowered Decision Making
7. Managing Entrepreneurial Growth & Learning
8. Becoming a Strategy Focused Organization

Managing to Win - Improving Performance with Systems Thinking

Constructing & Simulating Mental Models...assumptions that must be overcome!

1. Factors operate independently… each factor impacts the outcome, but it does so independently
2. Causality is assumed to run one way… from factor to outcome, but not back again
3. Impacts are felt instantaneously… there are no delays or lag times between factor changes and outcomes
4. Impacts and changes are linear and constant… X% change in input always results in Y% change in output
5. Effective organizations must be collections of functional, divisional, and/or geographic fiefdoms… and can not be modified to better reflect how reality actually works