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Case Study: Using the Balanced Scorecard to Move from "Management by Experts" to Managing for Results through Data-driven Decisions By John...

2. Investigate and Analyse the Organization’s History and Growth.
3. Identify Strengths and Weaknesses within the Organization.
4. Gather Information on the External Environment.
5. Analyse Your Findings
6. Identify Corporate Level Strategy.
7. Identify Business Level Strategy.
8. Analyse Implementations.
9. Make Recommendations and final conclusions
Mecklenburg County Case Study ©2009 Balanced Scorecard Institute Page 1 of 20 Case Study: Using the Balanced Scorecard to Move from “Management by Experts” to Managing for Results through Data-driven Decisions By John McGillicuddy, Mecklenburg County General Manager Abstract Today’s heightened emphasis on accountability requires a new model of managing publicly funded resources. No longer can local government rely on department directors making subjective decisions as the resident expert in their field. Implementing a balanced scorecard provides a comprehensive and consistent approach to managing for results using data-driven decisions aligned with the organization’s mission, vision, goals, and strategies. In 2001, Mecklenburg County began its journey with a long-term vision of the community in 2015. Seven years later, Mecklenburg County has achieved approximately 51% of its 15-year balanced scorecard goals. In addition, in 2008, nearly all County departments met or surpassed annual agency goals that support the Board of County Commissioners Community & Corporate Scorecard. Although there is still a long way to go and a lot more goals to achieve, Managing for Results (M4R) and the use of the balance scorecard has been an unqualified success for Mecklenburg County. This philosophy has transformed the organization from one where accountability was vague or isolated to a few subject matter experts, to a system of widespread accountability and transparency based on data-driven decisions. This case study will discuss the top lessons learned by Mecklenburg County, NC during seven years of implementing and using the Balanced Scorecard Institute’s Nine Steps to Success ® framework as its primary performance management tool. Introduction Mecklenburg County is the largest and most urban county in North Carolina. In 2008, the population was estimated to be approximately 902,000 residents, according to the Charlotte Chamber of Commerce. Over the past decade, the population has increased more than 3% a year on average. This sustained growth during the last decade is larger than the total population of the fifth largest county in the state. Consequently, the demand for new infrastructure (e.g., schools, jails, courts, parks, libraries) has made debt service one of fastest growing expenses in Mecklenburg County’s budget. During the latter years of the millennium, the State of North Carolina was challenged with a fiscal crisis that resulted in financial impacts at the county level. (In North
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Mecklenburg County Case Study ©2009 Balanced Scorecard Institute Page 2 of 20 Carolina, counties serve as local agents of the State.) In the case of Mecklenburg County, state lawmakers reduced state funding previously provided by $25 million, equivalent to 3 cents on the property tax rate at that time. In return for reduced funding, the State allowed counties to levy an additional sales tax. The elected Mecklenburg Board of County Commissioners levied the sales tax, but in the subsequent election the Board’s majority switched political parties. The newly elected majority decided to reduce the property tax rate by three cents to offset the increase in revenue from the recently levied sales tax. As a result, the Board and the County Manager were faced with deciding how to cut $25 million from the annual budget. In previous similar situations, the elected officials and senior managers often chose to make across-the-board cuts. While this is an easy decision to make, the consequences often cut higher priority and better performing services in favor of lower priority and lower performing services. Other options also included cutting vacant positions first, to reduce the likelihood of laying off people from their jobs. However, this approach also cut vital jobs simply because of the timing of the vacancy. For example, one year there happened to be several vacant jobs in the customer service section of Tax Collector’s Office (OTC), so these jobs were eliminated to save money. However, during a revaluation of property values, the OTC was overwhelmed by increased volume of calls regarding their tax bills, and therefore also was unable to process tax payments. In retrospect, it was clear that cutting these vital positions simply because they were vacant was a poor strategy for reducing costs. It also should be noted that Mecklenburg County is a highly political environment, with the political majority of the board of county commissioners open to change in virtually every two-year election. Changes in the elected majority are often accompanied by swings in political priorities, resulting in changes in funding for services. However, prior to 2001, there was no consistent model used for making decisions based on priorities. This resulted in a very unstable and non-sustainable approach to achieving desired results. Essentially, the community and County staff seemed to be experienced alternating between two diametrically opposed views. On one hand was the view that county government could be all things to all people; the other philosophy was that there is never a good reason to raise taxes. With this backdrop, County Manager Harry Jones, appointed by the Board in October 2000, sought to develop a model and structure for decision making that could be sustained regardless of economic conditions or political ideology. I. Starting with Vision There’s an old adage that if you don’t know where you are going, any road will do. Said differently, the first step in an important journey is deciding where you want to end up. As it relates to Mecklenburg County’s M4R journey, where it wanted to end up was established through a visioning process conducted by the County’s elected leadership. In May 2001, the Board of County Commissioners adopted a long-term vision for the community. This vision is summarized by the tag line: In 2015, Mecklenburg County will be a community of pride and choice for people to LIVE, WORK and RECREATE. In July of that year, County Manager Jones made a commitment to Managing for Results
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This question was asked on Jan 15, 2013.

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