DTCC Inducted into Palladium Balanced Scorecard Hall of Fame

Award Recognizes Success in Using Scorecard to Achieve Strategic Goals

NEW YORK--(BUSINESS WIRE)--The Depository Trust & Clearing Corporation (DTCC) today announced its induction into the Palladium Balanced Scorecard Hall of Fame for Executing Strategy in recognition of its use of the Balanced Scorecard performance management methodology.

“Because we’re owned and governed by our principal users and operate on an at-cost basis, we have little margin for error in how we deploy our resources”

DTCC, the largest post-trade infrastructure organization in the world, has been using the Balanced Scorecard, created by Palladium Group co-founders Drs. Robert S. Kaplan and David P. Norton, for the past five years to optimize costs and monitor product development, customer acquisition and new sources of revenue.

“DTCC is proud to be recognized for our success in using the Balanced Business Scorecard,” said Donald F. Donahue, DTCC chairman and CEO. “Since we began utilizing the scorecard at the corporate level, we have focused on two objectives. One is to grow our portfolio of new products. The other is to control costs, especially for our traditional services, even as we expand our effort to reduce risks for the industry and safeguard the integrity of the financial system.”

DTCC is the only financial services firm among the five companies inducted into the Balanced Scorecard Hall of Fame during a ceremony held last night at the 2009 Palladium Americas Summit in San Francisco.

The Balanced Scorecard is a performance management tool used by many large companies to give a fast, yet comprehensive view of a company’s performance that is broader and more accurate than the mere examination of a financial balance sheet. DTCC’s Scorecard balances information on financial performance with other measures that gauge customer service, process improvement, strategic positioning and employee learning and growth, all of which are key drivers of the firm’s future success.

Through the use of the Scorecard, DTCC has developed tightly integrated strategy and operational management systems that help the company maintain an AAA credit rating.

“Our Balanced Scorecard allows us to keep track of our progress in achieving our strategic imperatives, ensuring we complete initiatives that support our strategy,” said Karim Houry, vice president and head of Business Reengineering and Quality at DTCC.

In the five years since DTCC adopted the Balanced Scorecard, new-product revenue has grown by more than 550%. Customer satisfaction is up by 25% – DTCC is now four points above the industry average. Employee engagement has risen 19%, and the cost of its core operations has been reduced 5%. By keeping focused on the metrics the Scorecard tracks, DTCC has been able to cut its customer fees by $2 billion over the last two years alone.

Procedures developed through the use of the Scorecard also helped DTCC during the 2008 market meltdown when the firm successfully completed the largest close-out in history – Lehman Brothers’ $500 billion portfolio liquidation – without any loss to DTCC customers’ clearing funds.

“Because we’re owned and governed by our principal users and operate on an at-cost basis, we have little margin for error in how we deploy our resources,” added Donahue, who said Scorecard measurements helped DTCC set, pursue and recalibrate its strategic goals. “By giving everyone up-to date measurements each month, it serves as a road map to guide us and keep all employees focused on what is vital to our success.”

Founded in 2000, the Balanced Scorecard Hall of Fame includes 128 inductees, including Motorola, Best Buy, Infosys Technologies, Hilton Hotels, Ricoh Corporation, and Brigham and Women’s Hospital, which span the private and public sectors throughout more than 20 countries. Inductees are selected based on the quality of their Balanced Scorecard implementation and the results they demonstrate over a period of at least two years.

“While the global economic environment is improving, many organizations, from private companies to government agencies, still face significant challenges,” said Robert L. Howie, Jr., managing director of Palladium Group and director of the Hall of Fame program. “Organizations using the Kaplan-Norton strategy management system are well-equipped in a nascent recovery to gain the kinds of insights needed to capitalize on new opportunities, mitigate risk and improve organizational performance.”

About DTCC

The Depository Trust & Clearing Corporation (DTCC), through its subsidiaries, provides clearance, settlement and information services for equities, corporate and municipal bonds, government and mortgage-backed securities, money market instruments and over-the-counter derivatives. In addition, DTCC is a leading processor of mutual funds and insurance transactions, linking funds and carriers with financial firms and third parties that market these products. DTCC’s depository provides custody and asset servicing for more than 3.5 million securities issues from the United States and 117 other countries and territories, valued at $27.6 trillion. Last year, DTCC settled more than $1.88 quadrillion in securities transactions. DTCC has operating facilities and data centers in multiple locations in the United States and overseas.