Performance scorecard/dashboard is a support decision instrument, gives instantaneous information about the organization’s main drivers.
Running a high performance is a difficult journey. Reimagining the future of business is exciting, but investigating the different paths for unlocking business performance and potential needs to take a holistic approach. It is critical to define the right set of performance parameters which should cover all areas that contribute to multifaceted business value generation.
An important performance best practice, especially for an executive scorecard/dashboard, is that the essential information presented has a clear alignment to the strategy that the audience is trying to execute or manage, with logical process flow, clearly defined metrics and verified performance measure information.
Always attempt to identify areas in which measurable improvements can be realized: You can only manage what you measure, providing demonstrable value is essential to business success. The problem stems from the way outcomes are being measured. There are measures to motivate teams to achieve more and the measures to distract management from the ultimate business goals. When the collective outcome is the focus, the silo walls collapse. When individual and departmental outcomes are measured, the silos go up.
Even if you choose the right performance indicators, you must change them from time to time accordingly as business conditions keep changing. Otherwise, your business is going to be driven by that specific set of key performance indicators, or ignoring the bigger picture of the dynamic business. The performance measurement should ensure the business as the whole is superior to the sum of pieces. At the executive level, performance management should get the management to sit down and connect multidisciplinary management dots to tell the full story with the business context, and ensure the business as a whole is superior to the sum of pieces.
Assess profit & loss objectively: When top business leaders recognize their operational profit/loss point, focus on the revenue generation/increase vs. cost optimization. Create a spreadsheet into profit & loss calculation factors and how to improve performance results. The metrics need to evolve to something that matters to the business audience, at the same time that “business sentiment” needs to get put into something more tangible, such as optimizing processes or improving productivity.
From a business management perspective, the initiatives may be split between those that can reinvent or improve an existing business and those that a new business can be based on. Reinvention and improvement can only be improved for profitability otherwise it’s not good business. Take time to review various business unit’s performance data. Find ways on how the design will play a calculated factor into the measurement results.
Assessment of accomplishments for strategy execution: The one way to find out that the performance measurement setting is ineffective is by looking at the mindset, behavior and culture the performance parameter is driving. The goal of well-selected metrics and effective measurement should help to align performance management. Too much short-term focus on perceived “benefits” could be very problematic over the long haul.
Scoreboard/dashboard is an effective method to show business value. Furthermore, encourage the departments to create their own marketing plan for dealing with their different ‘customers inside and outside of the organization. Make an objective assessment of financials, margin expectations, schedule/progress. It takes the time to gain consensus/agreement for what to report and of course visually how to represent.
Performance scorecard/dashboard is a support decision instrument, gives instantaneous information about the organization’s main drivers. Scoardboard/dashboards and their associated means of data/information gathering and presentation are user selected, defined, structured, analyzed. In other words, it is a tool which is a part of a system for management. Intuitive visualization is also important in making the scoreboard/dashboard more effective in optimizing business management effectively.