Meaningful Measures–Infusing Company Values into a Balanced Scorecard: Datron World Communications Case Study

Virtually every company has them: mission, vision, and value statements. At some companies, they are cursorily reviewed during annual strategic planning sessions. Others prominently display their professed values in lobbies and on Web sites. But seldom do companies incorporate their values into the very essence of their management and measurement systems. Datron World Communications has done this in an unusually tangible manner – and has reaped remarkable business benefits from the effort, including a more than tenfold increase in annual revenues.

BACKGROUND
In 2004, Art Barter became CEO of Datron World Communications, a then $15MM division of a public company that provides tactical communication equipment for global military and public safety applications. When the parent company began looking to sell the division, Barter stepped in and purchased the division because he believed it had enormous potential – if he could transform the way it was managed.

Barter’s first change was to rethink the way success was to be measured. Rather than emphasize short-term financial results, which is what he’d seen dominate his nearly 20 years of prior experience within various public companies, he wanted to encourage Datron’s leaders to act based on what was ultimately best for the long-term health of the company, its employees, and its customers. To provide the right direction, the team articulated a clear, concise mission for the company: to positively impact people’s lives today and in the future, to leave people better off than they were when they first met Datron.

REDEFINING WHAT WAS MEASURED
But how do you actually progress toward this rather broad and sweeping mission? Not surprisingly, it all started at the top. Barter began to incorporate a style of management called "servant leadership," which is based upon trust, role modeling ideal behaviors, and inspiring employees to achieve their potential. Another big change was what he decided to measure – as well as what he decided not to measure. Rather than laying out specific short-term revenue growth targets, he told his people “Let’s go serve our customers. Let’s go live our purpose and our mission and take care of people. The rest takes care of itself.”

That’s not to say that Barter didn’t want to measure people or hold them accountable. In fact, he elevated the importance of measurement by measuring only what was truly meaningful and what would drive people to act in a way that would support the new mission.

But Barter recognized that just picking a new strategy and some top-level measures would not result in its being executed. He believed that in about two thirds of Datron’s departments, “there was a real disconnect between the strategic level and the active level for day-to-day operations. We needed help moving to the execution phase.”