Find out the benefits and considerations of scorecard tracking options.
The catch is that managing a Balanced Scorecard is no easy task. When an organization starts this process, there’s usually a learning curve, and it’s better to initially manage your scorecard with “manual” programs like Excel or PowerPoint. But sooner or later, you’ll experience challenges that indicate it’s time to graduate to more sophisticated systems—like Balanced Scorecard software. The most common issues an organization faces when trying to manage a Balanced Scorecard without software include:
ClearPoint solves all these problems. Our Balanced Scorecard software is built to help teams save time and effort as they work toward achieving their strategic goals. Our technology enables organizations to:
If you’re suffering from the pains of using Excel and PowerPoint to manage your strategy, graduating to a Balanced Scorecard software is the best next step. Sign up for a tour of ClearPoint’s system and see all of our scorecard management features.
On the other hand, if you’re just getting started and need more information about how to create and manage a Balanced Scorecard, keep reading to learn more.
The Balanced Scorecard (BSC) framework has been used and adapted over the last 20 years by thousands of organizations. Because of its flexibility, the BSC can be seen as a “framework of frameworks,” allowing organizations to manage the Balanced Scorecard with other strategic frameworks embedded. For example, you can have a BSC and also use Economic Value Added (EVA), Total Quality Management (TQM), Six Sigma, Lean, or other strategic management approaches.
The BSC is a comprehensive management framework—which is where its value lies. It helps you put your entire strategy in one place through finance, customer, internal, and people perspectives with objectives, measures, targets, and initiatives. But in order to get the most value from it, you have to actually use it as a management framework—not just as documentation for your “five year strategy plan.” The companies that get the most value from their scorecards track their objectives, measures, and projects on a monthly or quarterly basis—not just “every once in awhile” or every several years.
So this begs a question: What is the most appropriate way to actually track your scorecard on a regular basis? Most organizations use Excel, enterprise resource planning (ERP) software, or Balanced Scorecard software. Below, we’ll walk through the benefits and considerations of each—so you can pick the tracking method that is most appropriate for you.
Most organizations start by tracking their scorecards in Excel and PowerPoint. For small organizations and those just beginning with a Balanced Scorecard, Excel can be a great tool. It can create quick tables and charts, and it is flexible for manipulation and quick changes.
And because most scorecards are presented and discussed with the leadership team in front of a projector, PowerPoint is an obvious option. It requires little to no learning for the person putting the presentation together.
The problem is, the benefits of Excel and PowerPoint are not long-lasting. Version control in Excel, for example, can be a nightmare to deal with. Consider this story:
“I built up quite a bit of Excel experience in my days as a consultant and VP of strategy in a manufacturing company. When I joined the company, they were running their entire production schedule from a single spreadsheet, which was stored on an open-permission file server. One hundred and forty employees had access to the file on any given day, and it was very common to have someone make unauthorized edits to the production schedule. This meant we would have no idea when a product needed to be built and shipped.”
Chintan Sutaria, Founder of VisionPDM
While this Excel disaster isn’t specific to scorecarding, it is indicative of what could happen if too many cooks are in the scorecard kitchen. Ensuring that each person in your organization is updating the most recent version of your scorecard is critical—so when your scorecard becomes more complex or robust, using Excel becomes almost impossible.
The final word: Excel is great when you’re getting started with your Balanced Scorecard, but you’ll have issues with scalability.
If you work at a large organization, you likely have access to SAS, SAP, Oracle, or another piece of enterprise resource planning (ERP) software. If your organization has a dedicated software vendor, he will likely tell you, “We already have access to a Balanced Scorecard module through [said ERP solution]!”
The biggest issue with ERP solutions is the cost of integration and configuration.
In fact, you could easily spend $250,000-$500,000 configuring the ERP module to work for scorecard management—and could take 6-18 months to get up and running. Even if you are able to configure it correctly, changes and upkeep would need to be managed internally from your IT department—which, depending on their bandwidth, could be time consuming (and a big headache for them). For example, ERPs are not designed to track data and create appropriate reports in the same manner that your scorecard needs to be tracked—so your IT team would have to jerry-rig an extreme configuration. The IT team would also be on task for making updates on a regular basis.
The final word: Most organizations find the end result of an ERP/scorecard mashup is not worth the money or the time.
Between the two extremes of the unmanageable Excel and an expensive ERP scorecard is Balanced Scorecard software. A great scorecard software option is robust, highly configurable, and available at a manageable price point. And ideally, the software you choose should be able to communicate with both Excel and ERP applications via API or data loader tools.
To understand the value of scorecard software, it’s important to review (and discern between) the elements of scorecard management.
When you’re managing a scorecard, you need to start with your objectives, or goals. There are two ways you’ll know if you’re accomplishing those objectives: through measures and initiatives.
In an effective Balanced Scorecard, you’re reviewing both measures and projects for every objective, and then writing up your analysis about the results. This helps other team members understand what is going on with each particular goal.
Bring together all your metrics to analyze how your organization is doing with our Department Performance Dashboard.
Balanced Scorecard software provides value by giving you the ability to bring all of this together. With scorecard software, you can examine measures, data, calculations, and evaluations in order to drill down on projects (with start dates, end dates, percent complete, and milestones)—and then bring these things together at the objective level with qualitative information, RAG status indicators, etc. In other words, software gives you the ability to drill down to the appropriate details you need when examining a goal. You also need to have ownership and accountability of the elements in your scorecard, and typically this is native to a BSC application.
If you’re exploring scorecard software, take a look at ClearPoint. This comprehensive tour will tell you all about the features you want and need. But don’t just take our word for it—get free and instant access today so you can start managing your scorecard right away.
Regardless of whether you’re excited or overwhelmed by considering a switch, we’ve worked with hundreds of organizations migrating from a scorecard software that didn’t suit their needs to one that did—and we have a few pointers on how to make that transition as smooth as possible. We suggest taking the following steps in the order they’re listed below.
Odds are, you’re currently either using Excel or another reporting software, and you probably have a reporting process in place. Before the transition to a new system begins, we suggest mapping out your entire reporting process so you can identify the areas that need improvement and keeping those pain points in mind as you move forward. It’s critical to do this before you work with the onboarding team, because you need to be able to communicate with them effectively. If you don’t solve most of your pain points with new software, then why are you switching?
Your onboarding team should consists of your internal software team, members of your strategy management office, and members of your new software support team. We suggest you share your reporting process with the new software onboarding team and stress your pain points from the exercise you just completed above. They can apply their expertise and provide some suggestions to set your switch up for success.
Next, you’ll want to learn how to quickly and efficiently get the data out of your old system. If your scorecard is currently in Excel, it will likely upload easily into your new software. But if you’re using another solution, take a closer look at the exporting options available. Exporting back into Excel or CSV will probably be your best bet, but check to see if your current solution offers data exportation through an API. You can use this to obtain a comprehensive report of all your information in that account. Exporting in any way is much better than cutting and pasting each individual KPI, and can save you immense amounts of time.
Use the pointers and best practices laid out by the onboarding team, and add your data into your new solution. If you run into snags, make sure your new scorecard software support team can talk you through it.
If you get stuck in the report creation process, tag the software support team to show you how to create scorecards and reports that mirror those you’ve used (and liked) in the past. Additionally, they can help you create reports you may not have thought of yet and show you certain ways to format the data that might be helpful to you. We highly recommend utilizing your new scorecard software’s support database and knowledge library to get a jump-start on what is possible with the new software.
Select members of your team will become experts in your new scorecard software tool, and now is the time to get them started. These individuals should get a handle on how the tool works and what it’s capable of. From there, these individuals can train your basic users in how it works and how it’ll fit into the reporting process they’re already accustomed to. You probably can get some training documents from your software support team and then customize them for your own use and training.
After everyone’s trained, you’ll have your first monthly or quarterly report. Everything will, of course, go wonderfully because your setup and execution were flawless! You can then showcase the reports you’ve created to impress the leadership team.
Be proud of what you’ve done—but don’t stop there. As any true reporting superhero knows, management reporting and scorecarding is a continual process, and you need to evolve and grow with it.
If you’re worried about the intricacies of managing your Balanced Scorecard online tool, don’t be! In fact, a good system will take a great deal of stress away—not add it.
This step includes creating and organizing your goals, KPIs, projects, and your strategy map. ClearPoint allows you to quickly build scorecards and dashboards that update themselves.
Ask the following questions during this process:
The answers to these questions will help you create a more detailed scorecard, determine accountability for the elements of that scorecard, and get the historic information necessary for your reports. Your reporting software should offer various custom layouts and styling that adjust to your custom reporting process—not the other way around.
To do this, you may want to use the following:
ClearPoint makes report presentation simple with automated online Balanced Scorecard report capabilities, responsive design, and Excel and PowerPoint exports.
You’ve put everything in the software and configured it to suit your needs, so now it’s time to consider the following steps:
You’re probably concerned about how much time and money it will take to move your scorecard into reporting software to manage it online. If this sounds familiar, you’re not alone.
The reality is this: using a Balanced Scorecard online tool can save you time and effort during the reporting process. This is not one more random piece of software that won’t ever get used. This is a tool that you’re implementing to help yourself and your company manage its scorecard better, faster, and easier. You will be spending a fair amount of time in the software, but the reality is that you will be spending a lot less time organizing your scorecard as a whole. Thus, you will have much more free time to focus on the strategy itself.
Schedule time to talk to our team to learn more about the time that our Balanced Scorecard software can save you and your organization.
Ted is a Founder and Managing Partner of ClearPoint Strategy and leads the sales and marketing teams.