6 reasons to implement a Balanced Scorecard

These days most people know what a balanced scoredcard is. The challenge is understanding the benefits of a balanced scorecard to your organisation. Following on from a previous post Business Intelligence - Scorecards and Dashboards I discuss 6 key reasons to implement a Balanced Scorecard.

Definition: The balanced scorecard is a strategic planning and management system that is used extensively in business and industry, government, and nonprofit organisations worldwide to align business activities to the vision and strategy of the organization, improve internal and external communications, and monitor organisation performance against strategic goals.


This Balance Scorecard was designed using Sharepoint by enterprise Dashboard.

• Increase focus on strategy and results


• Improve organisational performance by measuring what is important


• Prioritise Projects & Initiatives


• Align organisation strategy with daily operational tasks


• Focus on the drivers of future performance


• Effectively communicate your Vision and Strategy

1. Increase focus on strategy and results

Implementing a balanaced score card requires your team to analyse the internal business processes. Metrics based on these findings allow managers to know how well their business is running, and whether its products and services conform to the strategy and mission.

2. Improve organisational performance by measuring what is important

What is important is defined by what is in the strategy and KPIs extracted from this strategy. By articulating these KPIs and measuring what is important via key metrics - this will improve a organisations performance.

3. Prioritise Projects & Initiatives

Once the each KPI metric is defined the projects required to achieve either the measurement or implementation to achieve strategic objects become more important. Although this is a very simplistic approach to determine what initatives are important - it does provide a basis for prioritising projects.

4. Align organisation strategy with daily operational tasks

In order for an organisation to achieve its strategic goals, daily operational tasks must be aligned to at least one of the strategies KPIs. The daily operational tasks will provide metrics that can be rolled up to provide Business Activity Monitoring. The investigation process will often reveal many daily operational tasks that you can not answer the following questions:

• Why do we perform this task?


• How does this task contribute to any of the strategic goals?

5. Focus on the drivers of future performance

Identifying what your future performance drivers are, will provide you with a focus of what activities are important to your organisation. Focusing on what metrics are required to measure the success of your performance drivers will provide you with the start of a roadmap.

6. Effectively communicate your Vision and Strategy

The balanced scorecard transforms an organisation’s strategic plan from an attractive but passive document into the marching orders for the organisation on a daily basis. It provides a framework that not only provides performance measurements, but helps planners identify what should be done and measured. The implementation of the vision and strategy help to communicate what is truly required in daily operational tasks to achieve one or more of the strategies KPIs. Communicating how a strategy relates to daily operational tasks with all staff both executive and operational will help disemeninate the vision.

These six reasons articulate how a Balanced Scorecard enables executives to truly execute their strategies.



Kaplan and Norton (the architects of the Balanced Scorecard) describe the development of the balanced scorecard as:

"The balanced scorecard retains traditional financial measures. But financial measures tell the story of past events, an adequate story for industrial age companies for which investments in long-term capabilities and customer relationships were not critical for success. These financial measures are inadequate, however, for guiding and evaluating the journey that information age companies must make to create future value through investment in customers, suppliers, employees, processes, technology, and innovation."

Put some business intelligence in your inbox

E-mail has already changed business forever, and now business intelligence continues to accelerate that change.

Microsoft's recent partnerships with SAP, Lotus and others are cementing Office applications as a platform for more advanced business software, the new push by Microsoft with PerformancePoint and Business Edge by SAP Business Objects. What may prove a more serious threat to Microsoft's BI moves is not the product plans of other BI vendors but the question of whether up-and-coming online office software, particularly Google Apps, will provide a competing vehicle for BI information.

Instead of trying to predict the next BI takeover, it would make more sense to explore what kind of partnerships SAP Business Objects and others will form with productivity application vendors to make their tools as popular as Microsoft e-mail and spreadsheets. If BI is going to be accessed more directly by business users, it's going to have to start looking more like the tools those users already know.

Fox Business recently announced that AutoRevenue Selects Business Intelligence Leader to Move Reports Online

"Selecting Business Objects, the world's leading business intelligence software, as our reporting platform enables us to provide on-demand reports from our website with a dealer portal," said @utoRevenue General Manager, John Max Miller. "Now our dealership clients will have self-service access to their marketing reports so that they can quickly see the success of their multi-channel sales and service campaigns and other key performance indicators."

Multiple report formats, such as HTML, PDF, Excel and Word files, will be available to @utoRevenue customers online. Dealers will receive e-mail notifications when reports are ready for viewing.

"This process of integrating Business Objects into our web environment will have two phases. First, dealerships will have access on our website to view all their current reports. A second phase will give the end-user the ability to trend data and to drill down into a report and locate specific information they want to know," said Miller. Dealership management will also be able to access real-time dashboards, giving them more control and a top-down view of areas they want to focus on.

The initial release will available to dealers by the end of first quarter 2008.


Microsoft Bill Gates presenting to 100 CEOs in the Beyond Business Intelligence: Delivering a Comprehensive Approach to Enterprise Information Management said

In the decade since that first CEO Summit, technology has transformed the world of business in profound ways. Back then, e-mail was just emerging as a preferred medium for business communication. E-commerce was in its infancy. Most companies still relied on faxes and phone calls to conduct business.

Today, we communicate and collaborate instantly with colleagues, customers and partners around the world. Global supply chains speed the flow of products from factory floor to store shelf. Cell phones are ubiquitous. Mobile access to e-mail is rapidly becoming the norm.

The impact on the workforce is remarkable. Productivity is higher than it's ever been. Buyers can shop the entire world without leaving their desk. Sellers have access to markets that were once beyond reach. The amount of information collected about customers, competitors and markets is unprecedented.

But there are times when it feels like all of these changes have overwhelmed the tools we use to do our day-to-day jobs. I wanted to share my thoughts on this important issue with you and other business decision makers and IT professionals.

The problem, really, is twofold. The first is information overload. Faced with the endless deluge of data that is generated every second of every day, how can we hope to keep up? And in the struggle to keep up, how can we stay focused on the tasks that are most important and deliver the greatest value?

The other problem is something I call information underload. We're flooded with information, but that doesn't mean we have tools that let us use the information effectively.



Business Intelligence: Developing a Query-Driven E-mail Delivery System is another post on MSDN Channel9.