System Dynamics and Balanced Scorecard

[Henk Akkermans]

Dear Amarildo, My colleague Kim van Oorschot and Myself recently wrote a paper on a case study of using SD to develop a balanced scorecard for a management team in the insurance sector. It was presented at the SD conference in Palermo and is called Developing a Balanced Scorecard with System Dynamics. It not only describes the case, the BSC and the SD model we developed, but also explains how SD can address several of the shortcomings that most BSC tend to have until now. I will send you a .pdf version if you are interested. Best regards, Henk Akkermans henk@minase.nl Minase, The Netherlands

["Rod Brown"]

Kim Warren has written about this dynamic balanced scorecard link in his book, "Competitive Strategy Dynamics", Wiley, 2002. Kind regards, Rod. From: "Rod Brown" <rod@strategydynamics.com> Roderick Brown Centre for Strategy Dynamics

[Inguna Ruza]

David Paul Todd has written master thesis: A Dynamic Balanced Scorecard: the Design and Implementation of a Performance Measurement System in Local Government. 2000. The full thesis are available at: http://www.synergia.co.nz/dynamicscorecard.asp Inguna From: Inguna Ruza <Inguna.Ruza@lattelekom.lv>

["Amarildo-UFRJ"]

Dear all, I am a PhD student in Management and I am interested in finding people who are researching the integration of System Dynamics to Balanced Scorecard. My interest is on any study where System Dynamics has been used to support the modelling of strategy maps of the Balanced Scorecard approach. Thank you Best regards Amarildo Fernandes Federal University of Rio de Janeiro From: "Amarildo-UFRJ" <acruzfe@ig.com.br>

["James L. Ritchie-Dunham"]

Amarildo, My dissertation looked at the influence of scorecards (financial and balanced) and enterprise information systems (fragmented and integrated) on different attributes of mental models and on organizational performance. It is available on-line at (http://www.instituteforstrategicclarity.org/lppubli.htm). Before you download the 3.0MB file, I will give you a brief overview. In a SD simulator-based experiment, we had 118 MBA students run a wireless telecommunications firm. For the mental model, we measured the subjects understanding of the causal linkages in the system, and where the subjects focused most of their attention. For organizational performance, we measured overall economic performance in the short and long-term. The results indicate that subjects using the balanced scorecard had a better understanding of the causal linkages in the business model than did subjects using the financial scorecard. The scorecard did not, however, significantly influence where subjects focused their attention. Additionally, better mental models of the causal linkages led to better long-term performance, but there was no difference for short-term performance. Where the subjects focused their attention had a very significant positive influence on both short and long-term performance. I would enjoy discussing this topic with you and any others interested. Sincerely, Jim ============================== James L. Ritchie-Dunham, PhD Executive Director Institute for Strategic Clarity 56 Maple Street Wilton, NH 03086-5505 USA jimrd@instituteforstrategicclarity.org http://www.instituteforstrategicclarity.org/

[chust@monisys.ca]

Exactly, To enable any Performance Measurement framework to achieve its objectives of improving Management Decision making Managers need: 1. to understand what in their System caused the indicator to do what it did 2. what to do in response to the problem without damaging other parts of the their System. One of the few methods/tools to do this with a group of people is System Dyanmics. In Ottawa, DND [Department of Defence] has started using SD to do exactly this. Yours, Gordon Kubanek, P.Eng. Ottawa Canada From: chust@monisys.ca www.TDVglobal.com