Business framework by Victor Cheng

When you start your career as a consultant, you'll encounter a lot of tools and frameworks. One of them is the Balanced Scorecard (BSC) – a strategic management tool that helps companies achieve their goals and improve their performance. 🚀The Balanced Scorecard was developed in 1992 by Dr. Robert Kaplan and Dr. David Norton. Their idea was simple: Successful companies have a clear strategy based on four key areas. The Four Pillars of the Balanced ScorecardThe brilliance of the Balanced Scorecard lies in its four perspectives, which ensure that a company’s strategy is balanced and comprehensive.The Financial Perspective looks at the financial goals and metrics of a company, asking: "How do we appear to our shareholders?"The Customer Perspective focuses on the question: "How do our customers see us?"The Internal Processes Perspective evaluates how efficient processes are and whether they meet customer needs. It asks: "Where should we excel?"The Learning and Growth Perspective focuses on personal development, including skills, training, leadership, and knowledge, asking: "How can we improve and create real value?"These four perspectives provide a roadmap for companies to clearly visualize their strategies. As a consultant, this understanding will help you think strategically and maintain a clear overview. 💡 How is Progress Measured?Once you’ve set goals for each perspective, it’s important to measure progress. This is where performance measures come in – the vital signs of a company.This isn’t just about lagging (outcome) indicators, but also about leading (predictive) indicators that help steer change. It’s better to focus on a few important things that can truly drive change (hint: Pareto principle). Why the Balanced Scorecard is Important in ConsultingAs a consultant, you’ll often be tasked with solving complex business problems and driving strategic growth. The BSC helps you approach these tasks in a structured and systematic way. It offers:A comprehensive overview: You can look at a company’s performance from various perspectives – from finance to customer satisfaction to employee development.Strategic alignment: The BSC ensures that all employees, from management to front-line workers, are working towards the same goals.Measurable results: The BSC ensures that all actions are aligned with the company’s overarching goals, increasing the likelihood of success.Another advantage of the BSC is its ability to foster clear and understandable communication within the company. The strategy is visually and comprehensively represented, which is especially beneficial in change management processes. The Challenges and Limitations of the Balanced ScorecardDespite its strengths, the Balanced Scorecard also has challenges. Creating and maintaining a BSC is time-consuming and requires continuous adjustments to keep up with changing goals and markets. Moreover, the BSC relies on accurate and up-to-date data; inaccurate information can lead to wrong decisions. Another downside is that the BSC focuses heavily on internal processes and may overlook external factors, such as market changes. Why the Balanced Scorecard is Important for You as an Aspiring ConsultantAs an aspiring consultant, the BSC will be a valuable tool in your consulting toolkit. It helps you support companies in:Fostering strategic alignment: You’ll help companies clearly define their goals and ensure that all employees are working towards them.Improving communication: You can help establish a common language within the company and avoid misunderstandings between departments.Achieving sustainable growth: With the BSC, it’ll be easier for you to promote balanced growth that considers both short-term and long-term goals. Key TakeawaysThe Balanced Scorecard is a great tool that will help you as a consultant take a holistic and strategic approach. It ensures a structured implementation of business goals, promotes sustainable growth, and helps you provide well-founded, measurable recommendations. The BSC could very well be your key to success as a consultant. ✨ 

The Competing Values Framework (CVF) is a robust model that helps organizations better understand, assess, and ultimately transform their cultures.The Competing Values Framework was developed in the 1980s. It began with a research study by Robert Quinn, John Rohrbaugh, and other colleagues aimed at identifying key indicators of organizational effectiveness. They conducted a factor analysis of existing organizational assessments and identified two main dimensions that formed the basis for the framework: internal vs. external and flexibility vs. control.Quinn is co-founder of the Center for Positive Organizations at the Ross School of Business. His research has helped advance the concepts of positive organizational science, which focuses on strengthening and improving organizations by building positive attributes, rather than focusing only on fixing deficits. John Rohrbaugh is a professor in the Rockefeller College of Public Affairs and Policy at the University at Albany, State University of New York. His research interests are in strategic management, organizational behavior, and decision-making.Developed in the 1980s by Robert Quinn and John Rohrbaugh, the CVF has served as a prism for studying organizations.How Can the Competing Values Framework (CVF) Help to Transform Organisational Cultures?The CVF divides organizational cultures into four main quadrants: Clan, Adhocracy, Market, and Hierarchy. These quadrants reflect the tensions between internal and external factors, and between stability and control on the one hand and flexibility and change on the other.Clan (Collaboration) - "Doing things together" / Long-Term Development: Clan culture is characterized by strong internal focus and flexibility. It is characterized by collaboration, participation and communication. The clan quadrant is often described as an extended family where employees feel a high degree of loyalty and belonging. In this culture, the main activities are often focused on teamwork, consensus building, and internal harmony. The main purpose is to create a harmonious work environment where employees feel comfortable and can best utilize their skills. The typical type of employee in a Clan culture is team-oriented, more loyal, and maintains strong personal relationships in the workplace.Adhocracy (Creative) - "Doing things first" / Innovations:Adhocracy is characterized by a high degree of flexibility and external focus. In this culture, innovation is at the core and there is a dynamic and entrepreneurial atmosphere. Main activities in Adhocracies are experimentation, risk taking and adaptation to change. The purpose of such a culture is to achieve competitive advantage through innovation and creativity. The typical type of employee is creative, entrepreneurial, and willing to take risks.Market (Competition) - "Do things quickly" / Short-Term Performance:The Market focuses on external factors, with a high priority on stability and control. This culture emphasizes competitiveness, results orientation, and performance. The main activities in Market cultures focus on transactions, competition, and achieving market goals. The purpose of this culture is to achieve market dominance through superior performance. The typical type of employee in a Market culture is results-oriented, goal-oriented, and competitive.Hierarchy (Control) - "Doing things right" / Working incrementally:The Hierarchy culture emphasizes internal factors and values stability and control. Here, the emphasis is on order, rules, and uniform procedures. The main activities in Hierarchical cultures involve coordination, organization, and efficiency. The main purpose is to ensure smooth operations and reliable performance. The typical type of employee in a hierarchical culture values consistency, order, and structure.Benefits and Possible Applications for ConsultantsFor consultants, the CVF provides a precise tool for analyzing their clients' organizational culture. It helps them understand their clients' current strengths and weaknesses, plan relevant changes, and design effective interventions.Knowledge of organizational culture can also help consultants develop customized solutions that meet the organization's specific needs and priorities. By using the CVF, they can determine, for example, whether an organization is willing to take risks and embrace innovation, or whether it values stability and control more.In addition, consultants can use the CVF to assess the impact of change on the organization. They can predict how a change will affect the existing culture and how to shape the change initiative to meet the needs and priorities of the organization.Overall, the Competing Values Framework provides a comprehensive map of organizational culture. It provides consultants with a clear path to understand and navigate the often-nebulous aspects of culture, and it provides an effective framework for designing and implementing change. It is an indispensable tool to help consultants help their clients adapt to an ever-changing business environment.