In 1992, Robert S. Kaplan and David P. Norton introduced the balanced scorecard (BSC) to the private sector as a method for measuring performance beyond financial outcomes. This tool reflects the four major dimensions of an organization: financial, customer, internal processes, learning, and growth.

According to Kaplan and Norton, BSC translates a company’s strategic objectives into coherent performance measures using a comprehensive framework. Moreover, they believe that BSCs can lead to “breakthrough improvements” in the areas of product, process, customer, and market development.

In her article titled “The Balanced Scorecard: Outsmarting design and implementation traps,” Marcela Presecan, head of research, explained the 10 areas that must be examined before using BSC in an organization: strategy drafting, management identity, bureaucracy, employee perception, communication without understanding, lack of common vocabulary, getting over the experimental scorecard, standardizing balanced scorecard design, adapting to the business environment, and commitment of the organization. “When implemented with its full potential in mind, the balanced scorecard is one of the best reflections of an organization’s contribution to the real operating environment,” she wrote.

Meanwhile, Manoj Dubey, a consultant at TKI, argued in an article that the concept of BSC must be revisited. “The perspectives of BSC, especially internal processes and learning and growth, should evaluate the quality aspects of an organization in Industry 4.0. It should ensure that strategy formulation, strategy execution, and performance measurement system are aligned to new technologies,” he wrote. “A traditional approach of BSC leads to fixed or orthodox KPIs which are not relevant in today’s technological scenario. The concept should revolve around improving processes using the latest IT; this includes having new KPIs.”

To get more perspectives and information on BSC, check out this specially curated resources.

Articles

• How Apple uses the balanced scorecard
• The balanced scorecard of Philips
• How to use a balanced scorecard in a board’s performance evaluation
• The balanced scorecard: review and criticism
• Insights on developing a bank’s balanced scorecard

Webinar

Understanding the components of the Balanced Scorecard System – Following a performance management process, the final step regarding a company’s key performance indicators (KPIs) after data gathering is reporting and decision-making. It is crucial that this step is done correctly, as it has an important impact on how organizations utilize KPIs to inform decisions. The focus will be on understanding proper reporting guidelines, along with using business analysis techniques for better decision-making and improved initiatives for performance enhancement.

Certification

The KPI Institute’s Certified Balanced Scorecard Management System Professional provides participants with relevant knowledge on how to develop and implement a balanced scorecard system. It also offers a comprehensive overview on the many benefits any organization can extract from the BSC system implementation. Sign up here.

Advisory Services

Through The KPI Institute’s advisory team, organizations and professionals have access to a diverse range of services from KPI advisory calls to complex performance management systems implementation spread over 12 different practice areas, including BSC. If you want to improve your current level of performance using a clear and concise toolset, the BSC is the answer. TKI’s experts and consultants are here to support you in this performance management journey by developing and implementing the BSC system down to the employee level. Learn more here.

Big data now plays a crucial role in every business’ success. Through the application of analytics, data analysis is allowing businesses to become even more competitive. 

Organizations adopt big data and analytics to analyze massive volumes of data generated by offline and online trading. Based on the Big Data & Business Analytics Market Statistics 2030, the value of the global big data and business analytics market is estimated to increase to $684.12 billion by 2030 from $198.08 billion in 2020. 

The goal of data analysis is to extract meaningful information and use it to make informed business decisions. By analyzing and comparing previous and new data, organizations can understand what happened in between. Then, organizations can come up with metrics and action plans to drive their performance. It involves boosting customer loyalty, increasing sales, improving and retaining successful practices, and enhancing employee productivity.

According to a PwC poll of 1,000 corporate executives, data-driven firms were three times more likely to achieve big gains in their decision-making capabilities. 

A data-first approach is required for a digital-first enterprise strategy. In a multi-cloud context, a well-planned data strategy for a digital company gives “business transformation opportunities, cost reduction, better engagement, and maximum flexibility.”

To get the most out of data, organizations must create an effective data analysis process. This procedure entails objective setting, data collection, cleaning and analyzing data, and data visualization.

Before collecting data, defining the goals of the organization is important. Businesses can choose the type of data to collect and evaluate it to ensure it is aligned with their goals. Then, businesses must integrate data using tools such as Informatica PowerCenter, SQL Server Integration Services (SSIS) by Microsoft, AWS Glue by Amazon Web Services (AWS), and Alteryx Designer.. 

All data must be gathered in one place to be examined. Companies must clean their data by removing irrelevant and unwanted information, fixing structural errors, and filling out the missing data in order to produce accurate findings. To better understand the data, organizations should use data analysis software and other technologies. 

Some data analysis software available are XLSTAT, the leading data analysis and statistical solution for Microsoft Excel; Python, a powerful tool consisting of materials for any aspect of scientific computing; and SAS, a statistical software for business intelligence and data management.

To acquire useful insights, businesses should dive deep into the data. They should analyze and narrow down the results of the gathered data to draw conclusions. Then, organizations must interpret the results to figure out the best next steps to reach the goals established in the beginning of the process.

Organizations should deliver information in a readable and understandable format. Businesses can present data using graphs, maps, and charts. Data visualization can help companies compare data sets and observe their relationships.

Data analysis helps anticipate future trends more precisely, allowing organizations to determine where they are headed and what they need to get there.

To learn more about data analysis, explore The KPI Institute’s reports and free webinars and stay tuned for the next schedule of the Certified Data Analysis Live Online Course.

New year, new me, right? What better time of the year than the early few months to get ahead of everyone else, by tuning in to the first webinar episode of the year. After several weeks of deliberation, we’ve finally decided that the best way to start off 2020 is by introducing our viewers to something traditional, akin to our namesake.

Now, we do understand that one size doesn’t fit all, and as a result, KPIs appear in the organizational world in accordance with strategic intentions. Therefore, there’s no preformatted recipe for them.

Nevertheless, among them, there are some which will indefinitely keep their value over time. In the performance management and business strategy field, KPIs are some of the main tools at hand.

In this webinar, we will be exploring KPI examples that are popular, rarely get out of use and will be reflected in the KPIs Architecture, one way or another. They will be addressed based
on the traditional Balanced Scorecard perspectives: Financial, Customers, Internal Processes, People Learning and Growth.

Main topics covered

• What are KPIs and how do they make a difference?
• KPIs examples that rarely lose importance
• KPIs Lifecycle: Evolution stage
• Tools for KPIs utilization

What you will learn?

• The definition, purpose, calculation and collection method for popular KPI examples;
• What happens with KPIs in the long run, as possible scenarios of their Evolution stage;
• An exposure of tools where KPIs make their appearance.

Presenter’s profile

Raluca Vintila is a Performance Management Consultant, at The KPI Institute, dedicated to the PMS Architecture at the Organizational, Divisional and Individual level, as well as a facilitator of the flagship program, Certified KPI Professional.

Some of the most significant consultancy projects she has been involved in include the following: Performance Management System Architecture Design (Organizational, Divisional and Individual level) and Organizational KPI Selection for organizations operating in the oil & gas, transportation, telecommunication and education industries.

So far, Raluca’s training and advisory sessions count has reached 22 countries, on 4 continents and 3,500 participants.