In my previous blog I have written about the four major obstacles for a successfull implementation of the Balanced Score Card. Of course, these obstacles are inherent to any new implementation; whether it be a new system, new functionality to an existing system or even new management practices and strategies and tactics.
If we focus on new technology than Dr Eli Goldratt has, based on the four obstacles, stipulated six questions which must be answered before starting implementing a new technology or system:
1) What is the main power of the new technology, system or functionality?
2) What limitation does the new technology, system or functionality diminish?
3) What rules ( obstacle ! ) helped us to accommodate the “old” limitations?
4) What rules should we use now?
5) Do the new rules require any change in the way we use the new technology, system or functionality?
6) How do we cause the change?
It is the TOC supports’, including me, opinion that the main reason for failure is due to the four obstacles and the existence of “old” rules. In the majority of the cases, lack of improvement can be traced back directly to “old” rules. Only by reducing the limitations/constraints and changing the corresponding rules, an organization will be able to achieve bottom-line results improvements.
Also, another major reason, which I mentioned in my previous blogs, is that the solution must be based on clear cause-effect relationships for achieving the ultimate goal; i.e. “bottom-line results”.
Therefore, any new technology, system or functionality must be implemented only when it will improve the “bottom-line results”.
In his book “sufficient, but not enough”, Dr Eli Goldratt specifically warns against implementing too many features and functionalities in a system. Reason being for most features and functionalities seems to be related to solving inherent conflicts within an organization. However, as we know, as long as we do not solve the root causes of inherent conflicts, we will always stay with ‘compromises’ which do not solve the conflicts.
The same seems to be the case with the BSC. Since the inherent internal conflicts within an organization are still included in the BSC, it is no wonder that a successfull implementation will fail at the lower levels in the organization. Usually, it is at those levels where conflicts exist between units and departments.