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Balanced Scorecards & echnology

www.spiderstrategies.com

Get Strategy Focused through Automation


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Te Balanced Scorecard

Te Balanced Scorecard is an organizational rameworkor implementing and managing strategy at all levels oan enterprise by linking objectives, initiatives, and mea-sures to an organizations strategy. Te scorecard providesan enterprise view o an organizations overall peror-mance. It integrates nancial measures with other key

perormance indicators around customer perspectives,internal business processes, and organizational growth,learning, and innovation.

Scorecard Development

Many organizations begin the scorecard process by read-ing one o the many books on the topic, attending aseminar, or doing web research. Te Balanced Scorecardis a mature methodology, and there are many resources

or introductory education, training, and consulting.

Once the organization has committed to the methodol-ogy, a third party acilitator (e.g., the Balanced ScorecardInstitute) is oten brought in to manage and bring anunbiased view to the scorecard development process.Scorecard development can be very rapid (ve days),or as long as a year, depending upon the scope andcomplexity o the scorecard and organization. Manyorganizations elect to go with a rapid or intermedi-ate approach, which insures project momentum while

recognizing that scorecarding is an iterative process. It isoten better to make and correct mistakes early while theorganization is still excited about the methodology.

Initial scorecard work is typically done with MicrosotExcel, PowerPoint, and/or Word. As the scorecardmatures, the organization should consider rolling out themethodology to the rest o the organization. Te goal isto connect all employees to the organizations strategicobjectives by using individual or group measures that areon strategy. Tis will help to institutionalize the newmeasurement ramework within the organization.

Sustaining the Scorecard

Te premise o the Balanced Scorecard is to provide anon-going, living ramework that is communicated to theorganization. Te scorecard needs to be sustainable andeasy to roll-out. Scorecards should leverage technology toprovide automated links to measures, texts, and initia-

tives. Ultimately, the scorecard should become part othe organizations culture and employees work experi-ence. An easy to deploy and embrace web based systemwill allow or rapid roll-out and a sustainable scorecardinitiative.

Culture and Connection

Once the scorecard is developed, it is important to cas-cade it into the organization. Tis will help link groupsand individuals to the strategy. Tis is important be-cause everyone needs to understand the cause-and-efectlinkage o how he/she connects to the organizationsoverall perormance. Te goal is to translate the strategyinto the stafs everyday speak and identiy measures osuccess that link to the overall strategic direction. As weconnect and link, the culture o the organization changesto be strategy ocused.

Using a sotware product will allow or everyone in theorganization to clearly understand the cause-and-efectrelationships so they can execute the strategy, align theorganization to the strategy, and provide measurementand a continuous eedback mechanism to make correc-tions to reach the desired strategic state.

Balanced Scorecard echnology

When choosing a Balanced Scorecard technology solu-tion, an easy-to-use and powerul web-based solutionthat requires little or no I involvement is essential. Tesolution should allow or either an on-demand hostedsolution (scorecarding as a service) or local installation.

Key Features (what to look or whenselecting a solution)

Web

Look or a solution where development and deploymentis done through a web browser. Cross-browser com-patibility is preerred. Solutions using the latest J2EEtechnologies and Ajax-style page updates are in-line withthe latest developments in web technology.

Ease o Use

Select a solution that is extremely easy-to-use. Choose a


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product that unctions like desktop sotware using let click to navigate andright click to develop. Also, look or products where data can be enteredthrough the web interace, uploaded rom a CSV le, or automated with adatabase connection. Products should be as easy to use as browsing a webpage or shopping on-line.

Strategy Maps

Te key to a good Balanced Scorecard is the strategy map. Any productselected should have the ability to create strategy maps with drill-downcapabilities. Strategy maps oten start out as a blank canvas to which youadd images, shapes, text, and numbers to create a visual representation oyour data. Once you make a strategy map, however, the colors and numbersautomatically update based on the real data in your system. Strategy mapscan also be used to track key metrics, visualize geographic data, and monitor trends.

Cascaded Scorecards

Organization-wide Balanced Scorecard roll-outs require multiple cascaded scorecards. Tis allows the organizationto start at the top o the house and roll down into department, group, or even to the employee level. Look or prod-ucts that allow or unlimited cascaded scorecards. Organizations should be able to drill-through to sub-scorecardsor individual measure views. Te entire organization should be able to roll-up inormation rom multiple scorecardsinto higher-level scorecards.

Balanced Scorecard Views

Organizations should select a solution that has many diferent waysto visualize Balanced Scorecard inormation. In additional to theStrategy Maps discussed above, other views could include Naviga-tional, Executive, Overview, Metric, and Analysis.

Communication

Look or products that allow or commentary on each level o thescorecard. It should be possable to create comments that are eithergeneral or period specic. Alerts, such as when your metric needsupdating (Notication), or when your metric turns Red (Push) are es-sential communication components.

Alignment

A good solution will allow or Balanced Scorecard Aligned Objectives to be easily created, so that scorecards canshow the perormance o their own objectives and measures, or o supporting objectives across various scorecards.

Automated Scoring and Weighting

A scorecard tool should allow or automated scoring and weighting o structure elements. Build your structure,


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dene the weighting, enter the measure values, and watch the scorecard color-up.

Initiative Management

Many initiatives will come out o the Balanced Scorecard process. Look or products that have ull blown initiativemanagement modules to manage these scorecard initiatives. It should be possible to create tasks and milestones andassign them to individuals or groups. All o the data should be visualized with sophisticated Gantt charts.

Report Writing

Reporting is still necessary in any scorecard initiative; get-ting the right inormation, to the right people, and at theright time is important. A good solution will come with abuilt-in report writer that contains canned reports like RedMetrics Report, Grey Metrics Report (missing values), andMetric Comparison Report (compares metrics within andacross scorecards). Te tools should also allow the user

to pull data out o a scorecard database or ad hoc report-ing. Te report writer should allow or slicing and dicingo perormance data and the ability to create exciting Flashpresentation graphs.

Integration to Desktop ools

Te solution should allow the user to export graphs, reports, and scorecards to desktop applications like Adobe Acro-bat, Microsot Word, Excel, and PowerPoint.

Briefng Books

Te tool should create on-line brieng books to consolidate dataor management, groups, or users. Brieng books should be easyto set up by browsing the Balanced Scorecard model and addingviews, reports, and graphs. Once the brieng book is created, itshould be easily viewed on-line or exported to Adobe Acrobat,Microsot PowerPoint, Word, or Excel.

Conclusion

Balanced Scorecard tools come in all shape and sizes ranging rom desktop applications to ERP modules. Selectingthe right tool depends on your organizational requirements. Te basic premise, however, should be that the solutionsupports a structured approach, while being easy-to-use, easy-to-embrace, and routine when it comes to achievingresults. A cost-efective, easy-to-use, web-based product, that requires little or no I involvement is ideal.

Spider Strategies, Inc.1701 Pennsylvania Ave NW Suite 300

Washington, DC 20006

[email protected]

www.spiderstrategies.com

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