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I am a firm believer in the operational executive using a balanced scorecard approach to developing strategy and looking at the core performance of a company or operating division.
The key flaw in the execution of using a balanced scorecard as a strategic tool is in the approach to execution. While there are 4 core quadrants to measure and manage (financial, process, people and customer) using this approach, the common execution flaw is beginning with financial first and letting financial drive the other 3 areas. It seems like the natural place for an executive in a financial services firm to begin but results in looking at the enterprise through the wrong lens.
Yes, Insurance is at its foundation a financial enterprise. But, beginning with financial and letting it drive the other three core areas actually limits the financial benefits available to the organization.
If you start with a focus on process, then the focus is on existing steps, touches and cycle time. Looking at processes with an eye towards elimination of steps, touches, duplication and redundancy – all result in financial gain.
If you looked at customer, with an eye towards identification and delivery of customer specific solutions, being delivered in new and value add ways, resulting in financial gain.
If you understood process and customer, then looked at people, with an eye towards who, where, when, what type (part time, full time, contract, vendor partner), would result in a constantly evolving need, mix and cost - resulting in much lower financial cost.
Yes insurance is a financial business, but beginning and ending your review of the businesses results, from a purely financial perspective, drives the wrong conclusions, and poor overall execution of your strategy.
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