“A New Balanced Scorecard for Communications” – a critique

The Business of Influence, Sheldrake, Wiley, 2011

I've just been pointed to a recent post by Tim Marklein on The Measurement Standard, A New Balanced Scorecard for Communications. I can't endorse it as it stands, as I understand it, and this post explains why.

For a bit of background, this summary of the Balanced Scorecard and associated Strategy Maps is based on the one in my book, The Business of Influence, and is one of my post popular webpages attracting thousands of visitors every month ;-) Do check it out if the Scorecard is new to you.

Having been frustrated by the very narrow practice of public relations, by the plain wrong approaches to alignment and performance measurement, and by the seeming isolation of the PR function from the rest of the business at a time when its best qualities are more vital than ever, I sought in 2009 to crystallise my ideas to help organisations transition to a more relevant and mutually valuable model. Knowing that organisational change is hard, I focused on the dominant way some of the world's largest and most successful businesses seek to articulate and guide performance – the Balanced Scorecard – in order to tap into the monster's own strengths, jujitsu style.

I called the resultant framework the Influence Scorecard, and I was delighted that Robert Howie, then the Director of the Kaplan Norton Balanced Scorecard Hall of Fame for Executing Strategy, penned the foreword.

PR measurement

Towards the turn of the decade the PR profession, under the auspices of initiatives such as the Association for the Measurement and Evaluation of Communication and the Conclave, began in earnest to articulate what might constitute good performance measurement, leading to the Barcelona Principles and the social media metrics (SMM) standards. The Principles represented a considerable improvement on the prior state of affairs in measuring PR, but then one has to remember that the prior state (outside academe) was so miserable as to effectively constitute nothing worth talking about. The SMM standards represented a painstaking attempt to secure consensus on the meanings of some of the most widely used terms.

For my part, I couldn't understand why PR needed to stand apart from the dominant approach to performance alignment and management adopted by the majority of functions one might find in a typical organisation. And yet it needed to be more than that because we are contemplating here a very essence of business that ranks up there with time, money, and materials – namely influence.

They all flow. They're universally mission critical.

In this post from February 2013 you can see that I was still trying to influence the debate to adopt a model of influence flows and the corresponding Influence Scorecard. And then a few months later the WOMMA Influencer Guidebook 2013 came out, with my two penn'orth. And not long after that, the AMEC Madrid conference celebrated the SMM standards and I cajoled again, this time from a distance.

We're now at the close of 2015 and Tim is presenting his Balanced Scorecard related ideas (although he uses the pronoun "we" ... the Conclave, or the IPR Measurement Commission, or perhaps both?) So it should be constructive to compare and contrast.

Fundamentals

Katie Delahaye Paine and I had a good chat in 2013 about some of her Scorecard related client work, predominantly with Canadian clients if memory serves, but other than that this is the first real interest I've seen from the PR community in the Balanced Scorecard since I started banging the drum six years ago! So that's fantastic. And yet there are two fundamental differences between the Balanced Scorecard for Communications and the Influence Scorecard, as I explain here in this section. And I've summarised some other problems further down.

First, having already tipped my hat to the Conclave's success in securing consensus on definitions, it's important to focus on the language here too. In considering a Balanced Scorecard for Communications, I note that "Communications" is only a subset of public relations, and public relations is only a subset of the domain of influence flows. Despite Tim's post emphasising the multi-disciplinary, I can only then reach the following conclusion on the back of that observation, and I'm sure someone will jump in here if there's a flaw in my logic...

A Balanced Scorecard for Communications seeks to support today's typical functional structure where communications is undertaken by communicators (perhaps specialising according to some media taxonomy), whereas the Influence Scorecard makes influence its object rather than the functional structure, recognising that:

Second, and equally important, the Influence Scorecard serves the influence strategy:

describes how an organization expects to influence and be influenced in ways that are wholly necessary and sufficient to the achievement of the influence objectives and successful execution of the overarching strategy; at once part of the overall organizational strategy (for what is an organizational strategy devoid of any aspect of influence?) and driven by it.

Each overarching organizational objective may demand a subset of influence objectives wholly necessary and sufficient in influence terms to accomplish the overarching objective. The Six Influence Flows conveys the depth and breadth:

The Six Influence Flows
The Six Influence Flows
  • 1st flow – our influence with our stakeholders;
  • 2nd flow – our stakeholders’ influence with each other in respect to us;
  • 3rd flow – our stakeholders’ influence with us;
  • 4th flow – our competitors’ influence with stakeholders;
  • 5th flow – stakeholders’ influence with each other in respect to our competitors;
  • 6th flow – stakeholders’ influence with our competition.

(The numbers are just labels rather than any indication of relative importance.)

A strength and a fatal weakness?

It has not been uncommon for a reader of my book to ask whether I attempted too much in wrapping my arms around all influence flows rather than sticking with something more practical like a framework for a specific department; marketing, or PR, or customer service say. In other words, isn't a Scorecard for Communications superior in that the context is more familiar, it deals with the world as we find it, and it can therefore be more readily understood and applied?

Yes, in that regard it is superior. However, that then is its fatal weakness.

The primary object here is not to find ways to make PR (or Communications) more measurable but to make the organisation more successful, and in organisational design we find that heterarchical topologies are increasingly superior to command-and-control hierarchies, and we find that emergent strategy is, by definition, more adaptive than the deliberate. The design of the 21st Century organisation is increasingly informed by natural living systems – distributed, complex, and responding to information flows (ie, influence flows) – rather than some relatively static construct readily comparable to those preceding it by four or five decades.

In short, should a Scorecard type approach lock-in today's functional siloes, or help give the various disciplines permission to adapt organisationally and the relevant sensory feedback to do so appropriately? (See The quantified self, the quantified organization, and the organized self if this assertion floats your boat. And "Cart and horse" below.)

More tactical questions

Metric identification and definition

Tim writes:

What makes the Balanced Scorecard so valuable is the integration of metrics across channels and disciplines into a unified framework.

Towards the end of the post, the reader is advised that plugging communications metrics into the Balanced Scorecard "enlivens them with organizational context and workflow."

This is incorrect. The Balanced Scoreacard does not integrate or enliven metrics defined amongst the constituent parts of an organisation so you merely have them in one easy-to-use format. One might call that a dashboard. Rather, the Balanced Scorecard process designs metrics to secure organisational alignment amongst those parts. It's a downward cascade not an upward aggregation. The context is designed-in not justified after the fact.

Cart and horse

He continues:

This balanced view not only helps improve measurement and performance of critical functions – it also plays an important role in strategic planning, team alignment, insight generation, and value creation.

This emphasis is round the wrong way. The Balanced Scorecard's primary role is strategy development and alignment for improved execution, which in turn requires improved measurement and performance of critical functions.

Functional departments be damned

First, we defined four quadrants that align and adapt the original Balanced Scorecard framework to reflect a logical grouping of marketing and communications goals.

To my main point above, why marketing and communications? What about PR more broadly? What about customer service? Does public affairs or sales or events or anyone else for that matter get a look-in?

At a really tactical level for example, it's increasingly considered best practice to encourage subject matter experts to enter into dialogue with the outside world directly ... so are they now part of the "communications" team? What about everyone in dialogue with / in relationship with everyone else?

Incoherent quadrant

Ultimately, we landed on four quadrants that have become relatively “stable” in our test product. The quadrants reflect a mix of process and outcome measures (vertical axis) mapped against tangible and intangible measures (horizontal axis) as follows

Balanced-Scorecard-thumb
The four quadrants of a new Balanced Scorecard for Communications

The original genius of the Balanced Scorecard was to build-in an anticipated cause-and-effect between the non-financial leading indicators and the financial lagging-indicators. In other words, if we work now to max those non-financial measures, we should execute strategy better than we might have otherwise, which if we have the right strategy means we should be able to look back in a quarter and see that the £s / $s came good too, either in terms of profit (for for-profits) or in terms of maxing their contribution to the mission (for non-profits).

This quadrant obfuscates that causal chain. It obfuscates the so-called single-loop and double-loop feedback. And perhaps there's more obfuscation ...

According to the SMM standards:

“Reach” is the total number of unique individuals who had the opportunity to see an item. Reach is typically a constructed metric that is based on the number of impressions, refined to eliminate the duplication of individuals who have had the opportunity to see the item through multiple media channels, or access points (e.g. laptops and hand-held devices) and to eliminate repeated serving of the item other than valid reproductions of that item across digital media).

In other words, reach is not a process. (It also appears to be a metric that suffers from some of the weaknesses that made AVE such a stupendiously stupid waste of time and money in terms of its "construction", but that's another issue.)

Relevance on the other hand isn't addressed by the SMM Standards at all.

And finally, the quadrant confuses tangible and intangible, or at least applies them differently to Balanced Scorecard practitioners. For example, land and machinery are tangible, and intellectual property and reputation are intangible. How Reach – a constructed metric, a remnant from the 20th Century print and broadcast worlds, and one that attracted dubious claims even back then – is tangible, I don't know.

Making friends and influencing people

I did invite Tim to discuss the work he's presented here a few months ago when I first heard it might be in the offing, but we never found the opportunity. It's obvious to anyone reading this far (thank you!) that I think the current manifestation of A New Balanced Scorecard for Communications is flawed. And do you know what, that might not make one jot of difference! Or it might entice people to revisit The Business of Influence. Who knows?!

But I do know that Tim is one of the most thoughtful and diligent PR professionals I've ever had the opportunity to share time with, and the profession needs more people like him to kick the tyres. Really hard!

For my part, I've found new challenges as I expressed in my post following the PR Council's conference in New York last month. Or perhaps, as the interdisciplinary and transdisciplinary become increasingly relevant here and in all matters, I'll continue to influence and to be influenced as I explore social business and org design, Web and Internet Science, and the hi:project.

May I ask if this exchange of blog posts has influenced you?

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