Robert S. Kaplan
Balanced Scorecard + Leadership = Successful Strategy Execution
In today’s business environment, strategy execution has never been more important. Though executives may formulate an excellent strategy, it easily fades from memory as the organization fights fires and tackles day-to-day operational issues. Robert Kaplan shows how to make strategy execution a continual process by combining existing management processes and functions, such as finance, HR, IT, operations and innovation, into a holistic strategy management system. Kaplan, co-creator of the Balanced Scorecard – the world’s leading management tool for strategy execution – shares several success stories, and discusses the one common element that is both necessary and sufficient for implementing strategy: exceptional, visionary leadership. Without it, he says, even the most comprehensive management system cannot deliver breakthrough performance.
Solving the Cost Crisis in Health Care
U.S. health care costs are nearly 20 percent of GDP and continue to rise; other countries spend less of their GDP, but are experiencing the same upward trend. Explanations are not hard to find – an aging population, new treatment developments and perverse incentives among them – but few acknowledge a more fundamental source of escalating costs: the system by which they are measured. Robert Kaplan, leveraging findings from his ongoing work with two dozen leading health care institutions around the world, discusses how valid cost measurement is building a foundation for transformational improvements in health care delivery, including clinician-focused process improvements, enhanced capacity utilization of personnel, equipment and facilities, and innovative bundled payment reimbursements that reward high-quality and efficient providers. Drawing from his current initiative with Harvard Business School colleague Michael Porter, Kaplan explains how helping clinicians, managers and payers focus on value-based health care delivery will drive better outcomes at much lower costs.
As companies adapt to the aftershocks of the global recession, risk management is increasingly a top priority for senior executives and boards in the private, nonprofit and public sectors. The financial crisis revealed that risk management processes are not effective when they are siloed, fragmented and delegated. Severe individual and organizational biases inhibit candid discussions about the assumptions and risks of enterprise strategies. Robert Kaplan helps managers think differently and better about their risk management processes: how to identify the different types of risk facing your company, how to achieve an appropriate balance between innovation and risk, and how to make cost-effective investments that protect your company from the consequences of uncertain and unexpected events. While recognizing the importance of strengthening existing compliance and internal controls, he advocates that managers focus their attention on the risks inherently created by their strategies as well as the risks that arise from external, non-controllable events.
Measuring and Managing the Profitability of Products and Customers
Managers are often surprised to learn that only a small percentage of customers generate substantially more than 100 percent of their profits; the remaining customers are either breakeven or unprofitable. Robert Kaplan, co-developer of activity-based costing (ABC), talks about how he is applying the new and improved version of this powerful costing approach to help manufacturing and service companies understand the economics of their products, services and customers. Through time-driven ABC, companies have the ability to assign virtually all organizational spending down to individual products and customers, enabling them to see for the first time where they are truly making and losing money. With this fact-based knowledge and analysis, Kaplan discusses the multiple ways companies can transform losses into profits quickly –leading to dramatic improvements within 6-12 months – without “firing customers.”