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SBSC: blending sustainability with the Balanced Scorecard

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In an era when environmental concerns are at the forefront of global discussions, businesses are being called upon to integrate sustainability into their operations. Developed as an extension of the traditional Balanced Scorecard (BSC), the Sustainability Balanced Scorecard (SBSC) aims to provide businesses with a tool to align their environmental, social, and economic objectives, driving positive impact while ensuring long-term success.

The genesis of the SBSC     

The concept of the BSC was first introduced by Robert Kaplan and David Norton in the early 1990s as a framework to measure business performance beyond financial metrics. The BSC aimed to provide a more holistic view of an organization’s health by incorporating four hierarchical perspectives:      Financial, Customer, Internal Processes, and Learning & Growth.

A decade later, as sustainability became a critical global concern, scholars started looking into the possibility of integrating sustainability considerations into the BSC. They agreed on the potential of extending the focus of the well-established BSC to include measuring business performance through      the lens of environmental stewardship, social responsibility, and ethics. Thus, the concept of the SBSC began to crystallize     .

How to build an SBSC          

When it comes to the best architecture for the SBSC, there have been conflicting discussions ever since the concept was introduced. Two major approaches took prominence: one is to add a fifth perspective to the traditional BSC that was dedicated to sustainability; the other is to integrate sustainability objectives and KPIs into the already existing perspectives.

A 2009 study showed that in the fifth perspective approach, sustainability KPIs tend to be overlooked by management in organizations with no established sustainability culture. That is why the four-perspective approach can be a safer choice, especially for organizations that are only starting to integrate sustainability in their measures.

In a 2021 article, Kaplan supported the four-perspective approach, introducing a suggested restructuring of three out of the four perspectives to make them more relevant to environmental, social, and governance (ESG) elements:

  1. From “Financial” to “Outcomes” to include environmental and societal objectives besides the financial aspect
  2. From “Customer” to “Stakeholder” to reflect the value of different members of the whole ecosystem
  3. From “Learning & Growth” to “Enablers” to encompass the various capabilities across all stakeholders in the ecosystem

Reaping these sustainability integration benefits can be a bit of a long shot, and further studies are needed to prove such benefits even exist. However, the only way to reap said benefits is to plant the seeds of sustainability integration. To help accomplish this, the SBSC can be a potent tool that allows organizations to measure, manage, and optimize their sustainability performance. As global challenges such as climate change, resource depletion, and social inequality loom larger, businesses must go beyond profits and consider their broader impact. The SBSC empowers organizations to embrace sustainability as a strategic imperative, paving the way for a more responsible, resilient, and prosperous future.

For more on utilizing the Balanced Scorecard, The KPI Institute has developed the Certified Balanced Scorecard Management System Professional to help organizations maximize the tools’ potential. And if you are interested in expanding your toolkit further, consider subscribing to smartkpis.com and gain access to the world’s largest database of documented KPIs, which includes a thorough collection of sustainability metrics.

Industry 4.0 and the Need to Revisit the Balanced Scorecard Concept

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Traditional quality management and business excellence practices are proving to be ineffective when used in the context of complex processes. Additionally, these initiatives are defamed for generating a lot of papers or soft documents without any analytical or added value in respect to automation and productivity. Due to that, the focus must now shift towards a quality movement that will make industries ready to fully utilize the advantages of the digital economy.  

End-to-end digital integration leveraging newer technological innovations, like big data, the Internet of Things (IoT), cloud computing, simulation, and Cyber-Physical Systems are helping in virtual space connecting with physical systems and in making real-time decisions and strategic planning. Industry 4.0 refers to the reform, transform, and perform industry with the help of IoT, especially AI and ML. This use of advanced information and communication technology (ICT) for industrial growth is now often called the ‘fourth industrial revolution.’ 

The concept of BSC was developed decades back when technology was just at its nascent stage. Currently, the concept needs to be revisited else it will only become a subject of academic interest. The performance measurement model should be such to evaluate the quality aspects of an organization in the context of Industry 4.0. The framework used should develop virtual tools to assess weaknesses in the current systems.

The impact of Industry 4.0 can help in enhanced customer value proposition through a better understanding of customer needs, data-driven product development, automated manufacturing, and continued product usage data monitoring. These will have benefits like better CRM, new strategic partnerships, expansion of the geographical reach of products and services through digital channels, as well as the development of new client bases and better retention of old clients. Hence, any performance scorecard should help customers in terms of availing of superior-quality products at low prices and better service.

The perspectives of BSC, especially internal processes and learning and growth, should evaluate the quality aspects of an organization in Industry 4.0. It should ensure that strategy formulation, strategy execution, and performance measurement system are aligned to new technologies so as to reap the following benefits: 

  • Improve productivity – enabling to do more with fewer means, such as in production; faster production in a cost-effective manner with given resources can give more and should help in less downtime and improve Overall Equipment Effectiveness.
  • Flexibility and agility – for instance, it should help in easier scale up or down output as a smart factory, making it supposedly easier to introduce new products or processes.
  • Regulation – complying with regulations in industries should not be a manual process; instead, Industry 4.0 technologies need to be leveraged to automate compliance, including tracking, quality inspectionsserialization, data logging, and more.
  • Customer experience – Industry 4.0 should be used to quickly resolve customer issues and offer them more choices. 

 A traditional approach of BSC leads to fixed or orthodox KPIs which are not relevant in today’s technological scenario. The concept should revolve around improving processes using the latest IT; this includes having new KPIs. The main hurdle emanates from the harsh reality that the BSC concept owners are traditionally performance management consultants and they are not fully aware of Industry 4.0’s percept and concept, barring a few jargons. This eventually restricts their vision to old and proven approaches which are not helping in providing that competitive edge to the industry. The present winning strategy is flexibility and response to the fast-changing and uncertain ecosystem which can be achieved through Industry 4.0 technology. 

There is a need to develop a scorecard or maturity level assessment tool that evaluates an organization and its adoption of the benefits from Industry 4.0 while taking the given budget and deliverables into consideration. This can happen only when we involve tech specialists in developing and keeping the tools themselves dynamic so that these may undergo revision after around every 12 months to keep abreast of the advancements in technology.

How To Hygge Up Your Christmas

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In a previous article, the Danish concept of hygge and its role in today’s lifestyle was looked at. The use of natural, environment-friendly items and a cozy room set up everyone can enjoy are two of the leading themes in the hygge design. All these habits are rooted in the main objective: to appreciate the simple joys in life.

Apart from the fact that hygge is essentially effective all year round, it has a significant place in Danish Christmas celebrations. As  Meik Wiking would say, “it’s the most hyggelig time of the year.” In this season, hygge is exceptionally cherished everywhere in the country.

As we enter the holiday season, it is the perfect time to consider applying hygge to bring comfort and warmth into our homes and families. It is especially favorable for those who are still going through another lockdown period in the face of the new variant of COVID-19 and wish to have a festive, yet safe Christmas. Below are several ideas on how you can decorate your Christmas hygge style.

  1. Light up your candles

    Remember the first rule: no candles, no hygge. Aside from advent candles, you can also either purchase scented or organic ones in various sizes. If you go for scented candles, pick soft fragrances for an utmost cozy atmosphere. Nevertheless, there are a lot of brands out there that provide holiday-themed candles you may consider as well, such as pine, cinnamon, and even candy cane.

    Feel free to put the candles anywhere in the house; on the dining table, along the windowsill, around the fireplace, you name it. Not only does the light add to the homely atmosphere, but it will also elevate the aesthetic aspect of the room. You can choose to keep it lit the whole day, the Danes usually light up some advent candles for only an hour each day throughout December.

    Most importantly, make sure you put them in a safe place. Avoid areas where the candles can fall easily, such as on top of stacked books (some people do it, but it is not entirely safe). If you have kids, best to keep the candles out of their playing area. You do not want to set fire to your house, right?

  2. Set up your own hyggekrog

    Entering the festive season does not necessarily mean that you do not have time for yourself. After working hard the whole year, you deserve to enjoy this holiday by having a peaceful rest and doing hobbies you did not have the chance to do much, such as reading for entertainment purposes. Setting up a hyggekrog or a reading nook where you can cozy up with a warm blanket, soft cushions, and your favorite book in hand sounds like a perfect holiday plan.

    Larger seating options, such as a sofa bed or a corner sofa, might be more applicable for houses with big spaces. For those who have limited living space, worry not! You can try using an armchair or even lay a simple rug then add a nice blanket and pillows. Best to have this set up next to the window so you can savor the view of either a winter wonderland or rain pouring outside your house.

  3. Decorate your home with nature

    A hygge Christmas is dominated by neutral and earthy colors. White, beige, and sage are among the color options you may want to bear in mind. However, it does not necessarily mean that you are not allowed to use the primary Christmas colors. Combining these two palettes in your decor will help you achieve a harmonious look.

    One interesting Danish Christmas tradition is cutting down a pine tree right from the forest and bringing it into the house so people can decorate it with candles. Talk about being deeply connected to nature; bringing in natural elements into the house will amplify your hygge experience. However, if it is too much of a task to have a freshly-cut Christmas tree, you may opt for smaller natural decorations that are easier to find, such as branches, leaves, acorns, and pines. 

  4. Create your own DIY decorations

    There are several ways to make a DIY project with natural elements. One option is to arrange the leaves into a garland which you can further decorate with Christmas lights, ball ornaments, ribbons, and pine cones. Another idea is to attach the branches on the wall then add hanging stars or Christmas bells underneath.

    If you are feeling even more creative, crafting your own natural advent wreath will not only boost the overall look of the house but also sharpen your skills. You will need some straw, wires, and spruce. Essentially, you need to wrap and weave the straw and wires into several layers to make sure you have a strong base. Then, layer the spruce on top of the wreath and decorate it with greenery, pine cones, ribbons, and other Christmas decorations of your choice.

    Additionally, figures of nisse (an elf or gnome), animals, and Father Christmas, as well as woven paper hearts made of glossy paper often adorn the houses in Denmark. These paper hearts are especially unique crafts to the Danes. They’re fashioned from two double-layered glossy paper cutouts, with the flaps of the two cutouts weaved together to form the heart shape.

    Aside from the paper cutouts, glossy paper is often used to wrap Christmas gifts. Exchanging presents has indeed been an innate tradition of Christmas as a form of shared happiness. However, most of the regular types of paper used to wrap gifts are not good for the environment because they are rarely recyclable. What can we do to avoid this?

  5. Use eco-friendly gift wraps

    In spite of the fact that people still widely use conventional ink-printed gift wraps, some of which are made of foil or plastic, most recyclers consider them difficult to process. It has become a problem because recyclers usually need additional chemicals to get rid of the ink when recycling wrapping paper. Taking this into account, there are some sustainable alternatives you can consider utilizing.

    You may be familiar with kraft paper, which is a brown paper used to wrap packages, shopping bags, and lunch sacks. Despite its plain look, kraft paper is recyclable so you do not have to worry about polluting the earth during this festive season. Besides, you can decorate kraft paper with dried flowers and ribbons to make your Christmas gift look elegant and pretty.

    Another recyclable and biodegradable gift wrap is newsprint. Using old newspapers makes the gift look vintage–which is in line with the spirit of hygge as it favors the nostalgic value of vintage items. Even so, newsprint with ink usually takes longer to biodegrade. Otherwise, you may opt to use repurposed gift wrap, such as old magazines or nice packaging you have from buying certain products.

    Nonetheless, the easiest and probably the quickest packaging you can find in a gift bag. You can choose between those made of paper or fabric, such as a tote bag. It is convenient and reusable; recipients of the gifts can reuse it for when they shop or gift another person in the future.

As the main purpose of hygge is to create a joyful experience through simplicity, you can still pass on the festive spirit of Christmas while still being considerate to the surroundings by prioritizing a homely atmosphere and the use of eco-friendly materials. In the age of heightened consumerism where people prefer fancy things that often harm the environment, hygge emphasizes going back to nature which is one foundation for the existing concept of modern lifestyle. Hopefully, this ignites new and interesting ideas that you can try with your loved ones at home this holiday season.

And with that, have a merry hygge Christmas!

Holiday Stress and How to Deal with It

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The holidays are a happy time. Based on the study by Greenberg Quinlan Rosner Research, people express numerous pleasant emotions during the holidays, including happiness (78% of the time), love (75% of the time), and high spirits (60% of the time). Many people love the holidays and look forward to spending time with family and friends.

However, the holidays are not always enjoyable for everyone. We all experience stress from time to time, but the holidays might add stress to the mix and make us feel even worse, such as setting up a budget for gifts, dealing with travel anxieties, or sitting through family get-togethers. Experts refer to this as “holiday stress”.

Stress can affect your mental and physical health. But what causes holiday stress and what can we do to avoid or lessen the effects of some of these holiday stressors?

Causes of holiday stress

The holidays bring with them a slew of difficult events. One is family gatherings, where there might be clashes of personalities and misunderstandings. For couples, choosing which side of the family to spend the holidays with can add to the stress. For single people, the additional stress might come from their inquisitive family members and their unsolicited opinions on certain life choices. 

Aside from that, gift-giving requires people to worry about overspending or underspending, as well as the etiquette of the gift type, its quality, and quantity. Travel anxiety can also be a source of stress, especially with the ongoing Covid-19 pandemic. There’s also that underlying pressure of making everything perfect if you’re hosting a gathering, from the decorations to the meals.

Work stress also does not go away. Even though time off from work is a major highlight of the holidays, many people get so concerned about not having enough time off and that work obligation may interfere with time spent with family.

Who is affected by holiday stress?

According to an American Psychological Association survey, females (44%) are more likely than males (31%) to be stressed over the holidays due to a lack of time (69% vs 63%), a lack of money (69% vs 55%), and an overabundance of pressure to buy or get gifts (51% vs 42%). Women are especially prone to holiday stress since they oversee many of the holiday activities, particularly those related to meal preparation and home decoration. 

Furthermore, women have a harder time relaxing during the holidays and are more prone to engage in unhealthy stress-management behaviors, such as comfort eating (41%) or drinking (28%). This is concerning not only in general but especially for persons who deal with addiction or substance misuse on a daily basis.

Around the holidays, people in the lower middle class in the United States face financial difficulties. People belonging to this demographic experience difficult struggles in affording and procuring material commodities. During the holidays, lower-middle-income people are subjected to commercialism and hype, as well as financial concerns about being able to afford the holidays without going into debt.

Coping with holiday stress

Holidays and stress seem to be linked in a way. With the preparations and celebrations, the already-hectic schedule gets considerably busier. There are a few things you may do to reduce holiday stress and feel more positive about the season.

  • Have realistic expectations

    The perfect holiday celebration does not exist. The pressure to be cheerful and happy is one of the main sources of holiday stress. If you find something that doesn’t go your way, accept it and let it go. Consider errors and mistakes as opportunities to demonstrate adaptability and resilience. To pick and choose what is realistic, you must first recognize what is specifically stressing you out. If the holiday shopping list is outstripping the monthly budget, simply cut back. Remember that the most important thing is spending time with loved ones, not on store-bought gifts, expensive décor, or gourmet cuisine.

  • Plan ahead

    Think of the things that often caused you to stress at the last minute and attempt to plan them ahead. Make a list of the gifts to buy or make, the budget you have for your holiday shopping, the time for decorating, and other things you need to do. From there, prioritize what must be done. Setting aside some time to consider the activities most likely will help you take tiny, real actions toward achieving them in a pleasurable manner.

  • Have healthy conversations

    It is necessary to be conscious of your emotional limitations when dealing with family and friends. Learn to recognize your emotions and know how to deal with them to communicate in a healthy manner. Focus on what you and your family have in common if you’re worried about heated arguments or negative dialogues.

    When things become too much, talk to close friends and family about your worries and concerns. Getting your feelings out in the open can help you navigate them and find a solution. Families may also organize activities that generate excellent fun and laughter, such as playing a family game or going through old photo albums.

  • Take time for yourself

    It is possible that, during the holiday season, you put yourself under the impression that you have to be everything to everyone. Self-care is sometimes the best thing you can do. Maintaining healthy habits — to the extent possible — will improve your mood. Find balance and self-care where you can throughout the holidays, such as making a healthy snack for yourself, drinking lots of water, and going to bed as early as possible.

Do not let this holiday season be affected by stress. The key to preventing holiday stress is to be aware of your actions. If your holiday traditions are not working for you or making you unhappy, it is time to do something about it.

Hygge: Exploring the Danish Concept of Comfort

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Derived from Danish culture, hygge (pronounced as hoo-gah) has become one of the many influential concepts society has today in creating spaces and building community. Looking back to its origins when Denmark and Norway were bounded as a kingdom, hygge actually comes from the Norwegian language that could be translated into “well-being”. In the early 1800s, the Danes adopted it as a concept to refer to “happiness” and it has been embodied in the heart of Danish culture ever since.

What does hygge look like in the present day? Currently, hygge is showing a strong, promising continuity in the 21st century among the Danes and has expanded its reach around the world through popular literature, such as “The Little Book of Hygge: Danish Secrets to Happy Living” by Meik Wiking. There is no strict implementation as the concept itself is embedded in both tangible and intangible aspects of Danish culture. 

On the tangible part, hygge is often associated with the coziness of a place. Its concept of simplicity and its nature as an appreciation for the simple joys in life has become a popular trend in interior and exterior design. It promotes a kind of aesthetic that gives spaces a rustic and homey feeling. Additionally, a 2018 research showed hygge as a principle that can be applied to build a sustainable, smart home due to its low-energy approach.

Meanwhile, the intangible value of hygge lies within social relationships. The Danes are known for their close-knitted relationships with friends and families which encourages equality and strong social circles. In this manner, hygge is not only manifested as a certain decor for social events but also as the sense of belonging resulting from being connected with loved ones.

Developing hygge through social connections

According to The World Happiness Report 2020, Nordic countries are among the happiest countries in the world, including Denmark. One of the reasons for this is their great respect for friendships and relationships with their loved ones. Specifically, the Danes tend to form small social circles with whom they bond and spend their hygge time. The significant level of social and institutional trust contributes to the increase in happiness and reduction of social inequality.

In the context of daily life, hygge is manifested through thoughtfulness in social interactions. This implies that no one competes to get into the center of attention so that everybody receives a fair chance to participate and feel welcomed. Equality and togetherness are the fundamental elements of hygge, and thus, the very heart of Danish culture.

Hygge is embedded in the way people make each other feel comfortable and relaxed. A lot of activities can be done to share the warmth of hygge with your loved ones, even as simple as hanging out after work or having a movie night on the weekend. The idea is to have quality time and make meaningful memories through small things.

Your home can be a good start to build a hygge kind of living. Someone once said that the “home is where love resides, memories are created, friends always belong, and laughter never ends.” Organizing your home in a way that makes others feel comfortable and welcomed is the next aspect of hygge.

Creating a hygge home

The main focus of a hygge home is how to create a hygge-like atmosphere, or a hyggelig as the Danes like to call it. Take a look around your own home and check the space and materials; can you find any sign of hygge? Below are some key aspects worth considering.

  1. Hyggekrog

    Roughly translated as a nook, hyggekrog is an important part of a Danish home. This is basically a reading spot where you can cozy up with a warm blanket, read your favorite book, or relax with a cup of warm beverage. Several seating options are available, with the simplest one being an armchair. If you want to go all-in, you can opt for a sofa bed, corner sofa, or add a nice ottoman to your armchair arrangement.

    There is no fixed location to build a hyggekrog; some might have it in the living room, kitchen, or study room. It would be a plus point if the hyggekrog is placed by the window so you may get a natural ambiance to add to the coziness. You can also spruce the space up with some thick knitted blankets and cushions. Placing a big wooden bookshelf nearby would be a great idea as well to complete the hyggekrog setup.

  2. Lighting

    Lighting is another core aspect of hygge as it centers around aesthetic and sustainable values in being visually pleasing and environmentally friendly. Due to the western origin of hygge, having a fireplace is a crucial component as it not only helps set the mood but is also a necessity for people to survive the cold winter. It is also manifested through the use of natural light, candles, and low-energy electric lighting.

    A fireplace might not be applicable for those living in other parts of the world that don’t have four seasons. An alternative element you can utilize is a candle which is a must-have item to create the perfect hyggelig ambiance. In Denmark, organic candles tend to be preferred over scented ones to preserve the natural simplicity of hygge, but of course, this is subject to personal preference.

  1. Furniture and decoration

    The highlight of hygge decor is the use of natural things such as items made of wood, leaves, and roots. Wooden chairs, plants by the windowsill, and an acorn wreath on the wall are just some examples of how you can make use of such rustic items. They make a perfect pair with candles or a fireplace to amplify the jolly and warm atmosphere, especially for a hyggelig evening with family and friends.

    Vintage items such as ceramics are also often seen in a hygge home. Aside from their aesthetic aspects, vintage items usually hold a sentimental, nostalgic value that elicits happiness by remembering the good old times. You can reuse some old items from your childhood and breathe new life into them as decor, or find something interesting in a nearby vintage shop. On that note, be mindful of your purchase so that it will not end up as clutter.

To conclude, the concept of hygge emphasizes generating happiness through the connection between people and the environment. Appreciating the simple joys of life is the main value that inspires the way the Danes configure their surroundings. Christmas may be a perfect season to apply hygge in your home as you gather with loved ones to celebrate and have a good time. Even if you do not celebrate it, practicing hygge will bring warmth into your house during seasons of warmth and cold, sun and rain, and all year round.

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