2. София 20 май 2004 United Nations Development Program Coordination Center for Information Communication and Management Technologies eGovernment Strategy Balanced Scorecard Kamen Spassov Coordination Center for Information Communication and Management Technologies kspassov@ccit.government.bg

3. eGovernment Strategy BSC, София, 20 май 2004 The Management System Vision and Strategy Management System FundamentalsProjectsInitiatives

4. eGovernment Strategy BSC, София, 20 май 2004 Elements of a Good Management System Derived from the Vision and Strategy of the organization Planning –Long term strategic plan –Short term business plan and budgets Measurement –Focused set of measures –Measures represent the organization’s plan and vision Review –Plans are regularly reviewed and suitably revised Performance –Rewards are linked to driving key measures

5. eGovernment Strategy BSC, София, 20 май 2004 What is BSC? A concept that transforms the organization’s strategy into real actions; A tool to measure activities of the organization; A management decision making support system; A technology that integrates actions of all parts around the objectives of the organization Market Share 85%

6. eGovernment Strategy BSC, София, 20 май 2004 BSC Philosophy Mission and vision definition Strategy development Perspectives identification Key success factors Measures Evaluation Action plan Feed back 1. Where are we? What are we doing? Where do we want to go? 2. How will we realize our intentions? 3. From which points of view can we look at our organization? 4. What are the factors influencing development in the right direction? 5. How will we measure our activities? 6. What are the results of the monitoring? 7. What will be our actions? Can we complete them? 8. What are benefits of the change? How do we continue?

7. eGovernment Strategy BSC, София, 20 май 2004 BSC Genesis Situation –Bias towards Financial Measures –Initiatives not all linkable to financials, hence Either not undertaken Or too many initiatives –Top Management need to focus The ‘Balanced Scorecard’ solution - Kaplan & Norton –A set of measures based on Finance Customers Internal processes Learning and growth –Linked to vision and strategy –‘Balances’ short and long term needs –Builds ‘leading’ and ‘lagging’ indicators

8. eGovernment Strategy BSC, София, 20 май 2004 BSC Elements Finance Learning & Growth Internal Processes Customer Vision & Strategy

9. eGovernment Strategy BSC, София, 20 май 2004 Finance To succeed financially, how should we appear to our shareholders? Financial measures –Show economic consequences of actions already taken –Show if strategy implementation has given results Typical measures: –Revenue –Gross Profit –ROI –EVA

10. eGovernment Strategy BSC, София, 20 май 2004 Customers To achieve our vision, how should we appear to our customers? Measures typically can be related to: –Customer satisfaction –Customer retention –New customer acquisition –Value delivery - to customer –Market and account share in targeted segments Segment specific drivers could be: –Shorter lead times –Innovative products and services –Better quality

11. eGovernment Strategy BSC, София, 20 май 2004 Internal Processes To satisfy our shareholders and customers, what business processes must we excel at? Define key business processes –Business process analysis –Business process reengineering Typical measures: –Time to complete a service –Decrease of the total cost of the process

12. eGovernment Strategy BSC, София, 20 май 2004 Learning and Growth To achieve our vision, how will we sustain our ability to change and improve? Employees skills and competences –Current –Needed for the future Typical measures: –Self Assessment –Certification

13. eGovernment Strategy BSC, София, 20 май 2004 Cause/Effect Relationship EVA Customer Loyalty On-time delivery Process Quality Process Cycle time Employee Skills Finance Customer Internal Processes Learning and Growth

14. eGovernment Strategy BSC, София, 20 май 2004 Customer recommendations Service helpfulness Merchandise value Customer retention DRIVES 5 unit increase in1.3 unit increase in0.5% increase in employee attitudecustomer impressionrevenue growth Attitude about the job Attitude about the company A COMPELLING PLACE TO INVEST A COMPELLING PLACE TO WORK A COMPELLING PLACE TO SHOP Employee retention Return on assets Operating margin Revenue growth Customer impressions Employee behaviour The rectangles represent survey information, the ovals hard data Sears Employee- Customer-Profit Chain

15. eGovernment Strategy BSC, София, 20 май 2004 Hypothetical Model Job satisfaction Commitment Service climate Training Resources Culture Line mgmt Customer Attitudes Business Performance Employee Attitudes Satisfaction Loyalty Recommendati on Spending intention Retention Sales volume growth Profitability Added value per head Return on capital Productivity

16. eGovernment Strategy BSC, София, 20 май 2004 Elements to Measure Relationships

17. eGovernment Strategy BSC, София, 20 май 2004 Why ‘Balanced?’ A focus only on financial measures is backward looking and restrictive Companies have several key stakeholders - not just shareholders, but customers and employees Measures should look to the future as well as the past and the present

18. eGovernment Strategy BSC, София, 20 май 2004 Kaplan & Norton Original Objectives Measurers Tangles Initiatives “To satisfy our shareholders and customers, what business processes must we excel at?” Internal Business Process Objectives Measurers Tangles Initiatives “ Learning and Growth Objectives Measurers Tangles Initiatives “To achieve our vision, how should we appear to our customers?” Customer Objectives Measurers Tangles Initiatives “To succeed financially, how should we appear to our shareholders?” Financial Vision and Strategy

19. eGovernment Strategy BSC, София, 20 май 2004 BSC Use Translating strategy into operational terms Communicating strategy and targets Monitoring direction and progress Reporting to stakeholders Changing behaviour Enabling double loop learning

20. eGovernment Strategy BSC, София, 20 май 2004 Possible Limitations Does it have to be 4 quadrants? Don’t be constrained by the format! Are employees adequately represented? Learning, growth, positive and forward-looking concepts, but what about commitment, attitudes, motivation? Designed primarily for the private sector

21. eGovernment Strategy BSC, София, 20 май 2004 Public Sector Differences - 1 Focus on cash limit rather than profit Funded by taxation and/or charges that are centrally fixed No shareholders Regional or national focus rather than global

22. eGovernment Strategy BSC, София, 20 май 2004 Public Sector Differences - 2 Political influence Requirement to respond to ‘central’ initiatives Stakeholders are different or have a different emphasis Concept of accountability Ethos of public service

23. eGovernment Strategy BSC, София, 20 май 2004 Public Sector Stakeholders Customers of services Employees Taxpayers Voters Wider public The Government

24. eGovernment Strategy BSC, София, 20 май 2004 Public Sector Tensions Cost versus quality Freedom versus regulation Spending constraints versus public demand Organisational wishes versus political direction

25. eGovernment Strategy BSC, София, 20 май 2004 Barriers Understanding the rules Data collection issues Organisational politics Time Expertise

26. eGovernment Strategy BSC, София, 20 май 2004 Strategy Description Strategic Map Perspectives Objectives of the organization

27. eGovernment Strategy BSC, София, 20 май 2004 Performance Measures

28. eGovernment Strategy BSC, София, 20 май 2004 Initiatives What do we need to do to realize the objectives?

29. eGovernment Strategy BSC, София, 20 май 2004 General View

30. eGovernment Strategy BSC, София, 20 май 2004 Linking All Parts of the Organization

31. eGovernment Strategy BSC, София, 20 май 2004 The Link http://obs.is-bg.net Username: public Password: welcome

32. eGovernment Strategy BSC, София, 20 май 2004 The Entry Point

33. eGovernment Strategy BSC, София, 20 май 2004 Strategic Management Management information system for e-government monitoring and strategic management based on the Balanced Scorecard methodology

34. eGovernment Strategy BSC, София, 20 май 2004 Strategic Map Model

35. eGovernment Strategy BSC, София, 20 май 2004 Bulgarian eGovernment % of basic public services for Citizens and Businesses, available online 2003 – Actual Citizens – 47.17 % Businesses – 34.32 % 2004 – Planned Citizens – 68.03 % Businesses – 77.83 % 2005 – Planned Citizens – 100 % Businesses – 100 %

36. eGovernment Strategy BSC, София, 20 май 2004 Up-to-Date Achievements Best scores and maximum result for: Job search services Job search services by labour offices – 100 % Declaration to the Declaration to the police – 100 % Public libraries – 100 % Public libraries – 100 % Social security Social security contributions – 75 %

37. eGovernment Strategy BSC, София, 20 май 2004 Functional Advantages Several view-points User-friendly, web-based interface Cause-and-effect relationship Quantitative measurement by key performance indicators Multidimensional analyses Qualitative assessment Feedback and communication

38. eGovernment Strategy BSC, София, 20 май 2004 Information System Design BSCStrategicProcess eGov MIS ConceptualmodelDataCollectionProcess

39. eGovernment Strategy BSC, София, 20 май 2004 Technological Background OLAP cube for each measure provides OLAP cube for each measure provides analyses across different dimensions analyses across different dimensions Manager Loader Input Dimension Fields in Master Tables Populate tables Architect Metadata Create Tables Master Tables Fields in Dimensions Input Tables Real & Plan data Base Tables Real & Plan data System Tables Real & Plan data

40. София 20 май 2004 United Nations Development Program Coordination Center for Information Communication and Management Technologies Thank You! Kamen Spassov Coordination Center for Information Communication and Management Technologies kspassov@ccit.government.bg