Metrics and Balanced Scorecards at
Bristol-Myers Squibb
Peter M. Fasolo, Ph.D.
October, 2003
1
Content

Company Introduction

Metrics at BMS

Examples

 Employee
Preference Survey
 Retention
Scorecard
 Americas
Region Scorecard
 Executive
Committee Scorecard
What’s Next
2
Bristol-Myers Squibb’s Mission
Our company’s mission is to extend and
enhance human life by providing the highest-
quality pharmaceutical and related health care
products.
3
Our Businesses
% of 2001
Global Sales*
Worldwide Medicines .....….….. 86%
Prescription Pharmaceuticals
Consumer Medicines
Healthcare Products
...……... 10%
……....…...………….. 4%
Mead Johnson Nutritionals
ConvaTec
(ostomy & modern wound care)
Medical Imaging*
* Excludes DuPont Pharma sales
4
Sales by Geographic Area
% of 2001 Global Sales
United States
68%
Europe,
Mid-East
& Africa
19%
Other Western
Hemisphere
6%
Pacific
7%
5
Bristol-Myers Squibb
Organizational Context



New Chairman and CEO with Bold Transformation Plan
 Focus on Core Rx Business
 Rebuild Executive Team
 Divest and Spin-off Businesses
 Focus on Core Acquisitions, In-Licensing and Partnerships
Recent Product Launches
 Abilify
 Reyataz
 Pravigard
Promising Late-Stage Pipeline
 Erbitux
 Entecavir
 Factor XA
 Dual PPAR
 CTLA4Ig
6
BMS Employer of Choice
Why Bristol-Myers Squibb? - External Confirmations
America’s Most Admired Pharmaceutical Company-2001
One Of The Top 10
Best Companies for
Working Mothers
Hope, Triumph, and the
Miracle of Medicine
Money Magazine
Top 500 Companies
No. 3 in Best
in Using Technology
Company Benefits
And More >> http://www.bms.com/aboutbms/awards/data/index.html
Survey 2001
7
Relentless Focus on Performance at
Bristol-Myers Squibb

A Balanced Scorecard Strategy Supports the
Enterprise Direction of Objective Performance
Assessment, Alignment and Personal
Accountability
8
Phases of Metrics Development

Descriptive

Prescriptive

Diagnostic/Strategic/Consultative
9
Metrics Journey
Diagnostic/
Strategic/
Consultative
HR Metrics
Laboratory
Turnover
Analysis
Prescriptive
EPS I
Americas
Region
Scorecard
Retention
Scorecard
Exit Survey
Descriptive
2000
2001
2002
Executive
Committee
Scorecard
Metrics/
Survey
COE
2003
10
Example 1: Employee Preference Survey
11
Based on Employment Data from 2001
. . . the following US employees voluntarily
departed Worldwide Medicines




1 of 10 Worldwide Medicines Employees (10%)
1 of 6 US Medicines Employees* (16%)
1 of 6 US Sales Employees (16%)
1 of 4 US Marketing Employees (24%)
*HQ, SP&A, Global Marketing, PC, BMSOV
12
Worldwide Medicines US Turnover - 2001
(including Puerto Rico)



Population on 1/1/2001: 15,176
Terminations: 2,624 = 17%
Voluntary: 1,484 = 10% of total
population
13
Worldwide Medicines Direct Costs
Associated with 2000 Staffing
Advertising
Sign on Bonuses
Full Year Bonus Guarantees
Referral Bonuses
Relocation
$
85,000
3,272,000
400,000
20,000
35,204,000 (US 17,800,000)
Agency Fees (6 mos. actual 2001)
2,461,000
Training
9,000,000
$ 50,442,000
14
Key Data Points - Examples
Value Skyline
15
Key Data Points - Examples
Employee Retention Index
Overall
0.47
0.42
Benchmark
0.48
Females
Males
0.46
0.44
Managers
Professionals
0.48
Sales
0.48
Marketing
ERI Level
No intention to leave
Strong intention to stay
Moderate intention to stay
Neutral
Moderate intention to leave
Strong intention to leave
Intention to leave, job search underway
0.31
Termination Analysis:
0.45
HIPOs
0.00
Index Value
1
0.67
0.33
0
-0.33
-0.67
-1
0.33
0.67
ERI Index Values
1.00
In August 2001, survey scores of individuals who voluntarily
terminated were compared with employees who remained
with the Company.
An analysis of ERI scores revealed its predictiveness.
Employees with lower ERI scores actually left the company
at a much greater rate.
16
Example 2: Retention Scorecard
17
Retention Scorecard
Goals and Objectives

Significantly reduce voluntary turnover across the
organization

Focus managers on the primary means of retaining talent

Put emphasis on reasonable actions managers can take to
broaden the talent mix

Communicate and emphasize organizational priorities
18
Retention Scorecard
Field Study Design
Scorecard and
Monetary Reward*
Scorecard Only
Control Group
* $5000 upside kicker
19
Retention Scorecard
Retention Scorecard
Employee Name: ___________________________________
Peformance Year: __________________________________
Development
Yes
No
Complete all aspects of the Leadership Development process for all direct
reports:
Standards & Expectations set and reviewed throughout the year
Development Plans established and reviewed throughout the year
Career Dialogue conducted (career direction and work-life balance)
Annual Development Summary completed




All direct reports understand how skill sets and career goals are aligned with
job responsibilities, e.g., Position Profiles

Maintain overall quality score of 4.0 or higher on career and personal
development discussions, as assessed by your direct reports

Ensure a diverse slate of candidates for each position filled during the year

Management Capability
Yes
Direct reports understand the department/district/region objectives and how
they align with business unit objectives, as assessed by employees

Direct Reports have a clear understanding of their role, role objectives and fit
with the department/district/region's objectives, as assessed by employees

No
Weighting
100%
completion
required for
participation in
Scorecard
30%
Percent of
Reward
30%
Conduct regular communication and coaching sessions with direct reports:
Team meetings/teleconferences, at least monthly
One-on-One feedback and coaching, in addition to LD process


Retention**
Yes
No
Lose no more than one of your highest performing employee, as identified in
January***

Percent of
Reward
40%
Turn or manage out 100% of identified low performing employees

100%*
* 100% of talent management reward = $5,000
20
Retention Scorecard Results

No difference between monetary and “scorecard
only” group

Both groups were significantly better at
development, management capability and retention
than control group

What you measure matters
21
Example 3: Americas Region
Scorecard
22
Americas Region Scorecard
AMERICAS SCORECARD (SAMPLE DATA)
August 2003
Lead with a Compelling Vision by
Build Sustainable Long-Term Growth While
Living our Mission and Pledge
Achieving our 2003 Financial Objectives
YTD
YTD
Perf vs
Goal
Actual
YTD Goal
Mission
Goal
75%
Perf
80%
Sales
$
35,000 $ 26,000
23,000
88.5%
Pledge
65%
60%
BUC
$
16,000 $ 9,754
10,212
104.7%
Pride
80%
85%
Annual Goal
All dollar values reported in millions
Drive Key Brand Growth
Annual
YTD
YTD
Perf vs
Goal
Goal
Actual
YTD Goal
Reported Sales
Pravachol
Exit Share
YTD
YTD
Goal
Actual
% Attn
U.S. Market Share
110.1%
Pravachol
56.2
44.6
44.5
99.8%
Plavix
Glucovance
$ 1,546 $ 1,203 $ 1,324
2,545
454
2,124
367
2,012
365
94.7%
99.5%
Plavix
Glucovance
67.1
12.1
70.1
15.7
71.2
16.2
101.6%
103.2%
Glucophage XR
656
578
600
103.8%
Glucophage XR
4.6
4.6
4.3
93.5%
Tequin
242
168
157
93.5%
Tequin
3.7
3.9
2.5
64.1%
Avapro/ Avalide
454
375
375
100.0%
Avapro/ Avalide
21.6
19.5
14.8
75.9%
HIV
Paraplatin
879
578
745
457
799
465
107.2%
101.8%
HIV
Paraplatin
35.4
3.7
37.8
2.3
25.9
4.3
68.5%
187.0%
Cardiolite
574
487
467
95.9%
Cardiolite
45.9
54.6
58.5
107.1%
Excedrin
241
178
164
92.1%
Excedrin
64.2
37.9
31.3
82.6%
Deliver Pipeline Value
Create a OneBMS Culture
Annual
YTD
YTD
Perf vs
Goal
Goal
Actual
YTD Goal
Product Net Sales
Abilify
Goal
65%
Perf
68%
356 $
256 $
260
101.6%
One BMS Culture Index - Management
85%
73%
Metaglip
256
195
172
88.2%
Belief in Pipeline
60%
62%
Pravigard
87
64
70
109.4%
Belief in Future
90%
85%
Atazanavir
87
62
36
58.1%
Energize
95%
92%
Definity
21
11
9
80.6%
Focus
45%
45%
18
12
13
111.8%
Strengthen Our Team & Develop Our People
Lost YTD Ann.YTD
496
5.0%
300
6.5%
Development
32
7.1%
Employee Development Index
12
11.2%
Development Plan Rate (D6+)
38
6.5%
60
2.3%
54
10.0%
Goal
80%
95%
Perf
86%
92%
Excedrin Quick Tabs
$
One BMS Culture Index - Enterprise
Voluntary Turnover TOTAL
Primary Care
BMSOV
Consumer
Medical Imaging
LA - C
Tech Ops
Goal
11%
13%
9%
8%
7%
4%
12%
Key Talent Turnover TOTAL
Primary Care
5%
6.3%
33
23
3.5%
5.1%
BMSOV
Consumer
4%
3%
4
3
6.9%
2.3%
Medical Imaging
5%
1
1.2%
LA - C
Tech Ops
4%
6%
2
0
3.2%
0.0%
Exit Data
Top 3 reasons
1. Direct Manager Quality (43% )
2. Developmental Opportunity (21% )
3. Company Culture (19% )
23
Example 4: Executive Committee (EC)
Scorecard
24
Purpose of the EC Scorecard

Track progress against company priorities

Assess employee perceptions of Bristol-Myers
Squibb

Guide action planning

Provide CEO and Board of Directors with year end
results
25
Background
Survey
50 questions assessing EC priorities & BMS as a best place to work
1 open-ended item: “What is working well at BMS?”
Survey administered April 7 to April 21, 2003
Stratified random sample of 5400 worldwide employees
(D6+ internationally, excluding hourly employees in manufacturing)
64.4% response rate (n = 3464)
Salary Grade Distribution
Key Executive: 128
Key Manager: 1437
Professional: 1516
Non-Exempt: 383
Gender
47.1% Male
51.2% Female
48 countries represented
21 functions represented
26
The Survey
Items Assess:
EC Leadership
Priorities
BMS as a Best
Place to Work
Criteria of Interest
(i.e.Intent to Leave)
27
Leaders Make the Difference

Nine out of the top ten factors which are correlated
with an employees intention to stay with the
company are strongly influenced by an employee’s
manager
28
Leaders Make the Difference
• I am confident I can achieve my career goals at BMS
58%
• I am treated in a fair and just manner
73%
• I am proud to tell others outside of BMS that I work here
73%
• My contributions to the company are recognized
56%
• We have a culture that encourages high performance with
the highest integrity
62%
• It is clear what is expected of me at work
83%
• I work in an environment where people support each other
74%
• The leaders in my organization listen openly to all points of view
57%
• The better my performance, the more I will be rewarded
47%
• I am compensated fairly
56%
All Employees % Favorable
29
Process and Next Steps

Results presented to Chairman and CEO

Workshop for EC and Top 35 Executives of the
Company

Action Planning and Employee Communication
Underway

Change in Scores Tied to Variable Pay

Next administration in September/October 2003
30
What’s Next?

Expanded Online Exit Survey

HR Measurement Laboratory

Follow-on Executive Committee Scorecard in
September/October

Metrics/Survey Center of Excellence for B-MS
31