In my previous blog I discussed the importance of developing a thorough approach to your Business Intelligence (BI) strategy. I illustrated that it requires a lot of ground work up front. Once work on the approach is complete; we then need to define the scoring and scorecards. When we talk about scoring and scorecards, and measures in BI solutions we commonly hear terms such as actionable, Key performance Indicators (KPI’s), dashboards and metrics etc. These are all very valid and indeed necessary, but how do we get there?
Let’s begin by clarifying that scorecards and/or KPI’s are derived from corporate drivers, quality control, efficiency, and related optimization goals that a particular industry is focused on. Along with analytics, scorecards assist in aligning strategy and mission critical objectives in an organization. Scoring or using scorecards, with the proper design (created during the approach phase) will provide the key metrics, indicators and benchmarks needed to gain insight.
It is important to stress that scorecards are not suited for a one size fits all strategy. Each phase of the business being evaluated or measured will have different processes, dependencies, and requirements to achieve change and improve outcomes. The key to scorecards and measures is to utilize BI solutions to develop descriptive, predictive, and prescriptive analytics that leverage performance management practices and methodologies. The definition and evaluations of measures are based on the usable, implementable, and the significant impact it will have on outcomes and efficiencies in an organization. A majority of businesses are filled with process and systemic drivers that contribute to results.
There is a key measure however that in my experience is often overlooked, that component is behavior. Most scorecards and measures evaluate or provide insight to process driven or data driven events only, however we need the ability to measure behavior as well. Behavioral measures impact results and indicate patterns and psychological response to services, pricing, and outcomes. A good quality BI scorecard and measures solution has all the necessary components in order to prepare, align and update the data to drive successful outcomes.