Balanced Score Card Plan April 2016

About this time, many business owners and their management team are actively building a plan for the new financial year. In small businesses it may exist mainly in the owners head, in larger businesses its put to paper and shared with the workforce. There are many ways to prepare a business plan and just as many formats to follow. In this post I present a brief extract from my book Business Owner to CEO (available through Amazon) that will make planning and managing in FY17 simpler and more effective.

As a general guide:

  • Business plans must be short, simple and easy to understand
  • Business plans must lead to clear actions
  • Business plans must include KPI’s to assist measure actions
  • Business plans are living documents that are best reviewed monthly and must be reviewed at least every quarter with all owners of the plan
  • Business plans should be shared widely in a business

I suggest that the Balanced scorecard method is the most simple and effective tool available. The concept of balance is applied to align goals/actions as the following diagram illustrates to address finance, business processes, the customer/products and the people who work in the business.


My interpretation of the balanced scorecard in its simplest form can be just five pages as outlined below for our hypothetical software business “Company-Name”. Simplicity here is essential because the document needs to guide people to action and ongoing accountability.

  • Page 1 – Details Company Name high level financial goals and the main focus of the business for FY14
  • Page 2 – Details the main actions (generally new actions) the sales team will focus on
  • Page 3 – Confirms the expected sales team delivery times for each action and therefore the focus of the management team over the twelve months of the plan
  • Page 4 – Details the main actions the product and service team will focus on (it is blank for you to apply your ideas to this hypothetical business)
  • Page 5 – Confirms the expected delivery times for each action (it is blank for you to apply your ideas to this hypothetical business)

Here I share just three of the pages. Page 1 provides a simple summary for all employees to share the high level plan. Note that Company Name has adopted a theme (tag-line) or purpose statement “our software saves lives every day”. As suggested in other parts of the book, all businesses need something similar to state WHY we exist and WHY we do, what we do.

FY14 Plan

The revenue and EBIT targets lead here, followed by five goals/actions that cover products/customers, business processes and employees. You can have more goals and more pages if required, but the idea is for the summary page to provide focus for the whole business for the whole year. Some SME’s would refer to this single page as a simple “one page plan”.

Page 2 provides the plan for the sales team. Most businesses have sales targets and achieving new sales and obtaining more sales from existing customers is critical for long term growth. Note how the revenue, product and customers goals/actions have been incorporated to a new level of detail required for the page one goals to be achieved.

Sales commitment to the balanced scorecard

In this plan the financial targets link directly to the $40M revenue goal. EBIT has not been addressed as the sales team are responsible mainly for new revenue, however they can significantly influence profit. The people quadrant identifies goals/actions that will improve personal performance, create a close working environment and add resources. The process goals focus on “lead to sale” activities, improving marketing tools and providing better mobile access to CRM for all employees. The goals/actions for customers are aimed at improving their use of Company Name products, but also provide an up-selling opportunity for the sales team. The fact that support for product B will be discontinued in the year creates a need to prepare users for an upgrade. This will be important to retain their revenue and ongoing support of Company Name rather than switch a competitor. It’s an example of how a balanced scorecard plan can simply show interdependencies in a business.

Each goal/action may require supporting information to confirm what is to be achieved. Work groups generally develop detailed project or improvement tasks when required and assign responsibilities to team members.

Page 3 provides the timeline and adds real value to using the balanced scorecard. You will see that all page 2 goals have been time phased. This is the clever part. Working through this process is what links the overall FY plan to specific deliverables. In this plan, page 3 will be used by the management team at monthly meetings to review progress and to discuss issues. The business owner/CEO will hold the sales manager to account at the formal meetings, but also use the plan for regular informal catch-up discussion.


Key members of the sales team will be assigned specific goals and tasked to manage each of the changes to be implemented in the year. The overall plan will be shared with every BDM and other members of the sales team to ensure that everyone is on the same page!

The process to develop a realistic plan

I refined this planning process over ten years leading a software business where we established a formal cycle with clear timelines. When you use a formal planning approach you will progressively develop your planning skills year on year. Developing formal planning skills and a process will also add value for your direct reports to as part of their development process. In the early years the plan may be owner/CEO driven and used to obtain commitment from others in the business. As experience and confidence increase the plan will become more collaborative with more contributors before it is shared across the business.

Recognising that the plan is for a new financial year (1 July in Australia) I suggested you start in early April by assessing the present year performance and forecasting what would be completed in the current year plan and what would carry over to the new year. As business owner/CEO you would then identify the high level goals (see page 1) and review them as required with other leaders or with the Board Chairman or advisory board. The next step is best facilitated off-site as a first planning meeting with direct reports where you share the goals as drafted. After reviewing your goals every team leader would then share goals they would like to include in the new year plan. This approach provides an opportunity for everyone to talk about their part of the business in a positive forum rather than one where ideas and goals are reviewed critically. Once the shared view is documented (a draft Powerpoint balanced scorecard from flip charts) the owner/CEO undertakes a series of one on one meetings with the team leaders to further discuss their ideas.

In early May the leader’s team should meet for a second planning session, this time with ideas polished and connected across the business so that dependencies become clear. As an example if a new release of a product is scheduled for October, marketing and sales team plans need to reflect key actions that may commence in July. The purpose of the second meeting is to ensure that the individual team 2 page detailed plans (actions and timing) are understood and supported by the whole group. Obviously 100% consensus is not always possible, but that’s the owner/CEO’s responsibility to resolve.

After the second planning meeting you can test the plan by drafting a new financial year budget. This process when refined for your business will allow you to plan for the new year with minimal disruption to normal business operations and ensures that every leader is well prepared to share the plan in their teams at the appropriate time.

This brief extract provides only an overview of an approach that is both simple and very visual, which I found is most valuable for communication across a business especially for review periods. Generally more complex and detailed plans prepared as Word, Excel or Google documents tend to confuse and may not be used.

So you have a simple tool to use for FY17. If you want more information go to:

Good planning!

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