375
million euro
shared value Ebitda,
36% of total Ebitda
(+14% over 2017)
184
million euro
shared value investments,
40% of total investments
71/100
customer satisfaction
our annual survey confirms the high
quality of Group services

The balanced scorecard of the Hera Group

The balanced scorecard approach enables us to assign “balanced” objectives to our management team, distributed over four areas: development, quality and corporate social responsibility, organisational integration and efficiency upgrading.

It provides a methodology pinpointing strategy which it translates into objectives and day-to-day actions. The innovation of this approach consists of considering the achievement of objectives of social and environmental sustainability as a condition for the achievement of the economic and financial objectives over the medium and long term.

What is the balanced scorecard?

The balanced scorecard is a strategic control system which is based on the connection between strategy and the day-to-day running of the company. It was devised in the early 1990s by the American academics, R. Kaplan and D. Norton. It has generated an immense following among leading corporations in the USA and is now being taken up by major European players.

The Strategic Map is updated every year based on the contents of the business plan: it provides a summary of the Group’s strategic objectives and its commitments to stakeholders set forth in the sustainability report.

During the 2018 budget process, 43 priority projects were defined to achieve the 30 strategic objectives set out in the 2019-2022 Strategic Map aimed at creating long-term value for the company and the stakeholders.

In line with the strategic guidelines outlined in the Business Plan, Hera Group’s Strategic Map contains the strategic objectives connected to the 3 drivers for the creation of shared value (CSV) explained for the first time in the 2016 Sustainability Report, namely:

  • Efficient use of resources;
  • Smart use of energy;
  • Innovation and contribution to the development of the area.

Specifically, out of the 43 priority projects assigned to the members of the Management Review Committee, 20 belonged to areas regarding the creation of shared value for the company: 4 projects in the “Efficient use of resources” area, 4 projects in the “Smart use of energy” area and 12 projects in the “Innovation and contribution to the development of the area” area.

The priority projects were assigned to members of the Management Review Committee.

All of the projects planned within the 2018 balanced scorecard system were assigned to a manager and included in the bonus system for Group managers and middle managers.

Each project identified:

  • the process and result indicators with goals in line with the budget of the Group and the corporate departments required for their achievement;
  • the key action plan for achievement of the project objectives in terms of time and cost.

The objective projects identified were monitored on a quarterly basis by the Hera Spa Management Review Committee and in the individual budget units.

The definition of objective projects and the relevant quarterly monitoring system of the project elements are a significant strategic management instrument that ensures:

  • integration of the several perspectives for the evaluation of corporate performance, in addition to traditional economic and financial measurements;
  • integration of business plan objectives into the daily management of managers and middle managers;
  • implementation of a continuous improvement process for strategic objectives and the relative projects and indicators;
  • formalisation and tracking of both actions and sub-objectives required to achieve the targeted results;
  • highlighting and analysis of critical situations and the definition of speedy corrective actions.

The commitments to stakeholders listed in this report (“What we will do…”) are contained in the Hera balanced scorecard. This guarantees consistency among the various instruments used for managing and achieving the Group strategy (business plan, sustainability report, management reporting, bonus system).