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Well, secondly, as I’ve been suggesting, there are really two value chains within this strategy map - the organisation value chain which covers inputs, activities and outcomes. And the business value chain which covers what I show as business impacts (really operations, customers and financial results.) This is another reason why outcomes are so important - they are the real deliverable of the work we do in the organisation value chain.
It's why Kaplan and Norton refer to measuring human capital (outcome) as the holy grail of managing intangibles.
And it’s why Dave Ulrich suggests that behind most of the ideas he has developed, including the ‘Ulrich model’ (three legged stool) and the use of organisational capabilities lies an increased focus on outcomes: “I wanted to define the roles of HR as outcomes more than activities. I saw a lot of work in HR focused on activities (number of hours of training a leader receives; whether a firm is using 360 degree feedback; if it implements performance based pay or competence based hiring). I wanted to shift the focus to outcomes of the activities.”
It’s therefore a worry that when I review business strategy maps and balanced scorecards with business executives I usually only find objectives and measures for activities, not for outcomes.
Even when I work with HR teams on people management strategies and HR scorecards, I usually find lots of objectives and measures for activities and very few for outcomes.
Ie outcomes are the most important step in our own value chain, but also the one which we put less of attention on.
It’s something we need to change.
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