Balanced Scorecard or BSC is a framework designed for strategic performance measurement. It is applied globally in different sectors like industry & business, non-profit and Government organizations. It helps to align all business activities strategically, improve external & internal communications and keep an eye on overall performance against the planned goals. Business executives and managers get a more ‘reasonable’ perspective of their performance.
BSC is a program that allows organizations to spell out their vision and strategy to translate both into action. This business-oriented scoreboard has been introduced by David Norton and Robert Kaplan in 1992. It is suggested to view an organization from 4 perspectives. Moreover, develop metrics, accumulate data, and evaluate it according to the four perspectives.
- Financial perspective – It covers organizations financial objectives. Managers can track the financial success of an organization and shareholder value.
- Customer perspective – This angle covers customer objectives like market share goals, customer satisfaction, and product/service traits.
- Business process perspective – This approach wraps up the organizations internal operational goals as well as sketch the main processes needed to deliver the business objectives.
- Learning & growth perspective – This section covers up the indefinable drivers for future success like employee skill-training, leadership systems, organizational culture, and databases.
Features to look for in the business-oriented scorecard software
During BSC software selection process, it becomes necessary to consider the set-up & design, configuration & technicality as well as Information security & execution cost.
Set-up & design to look for
- Examine the implementation of time and resources
- Needs to be flexible to adapt pre-existing scorecard model
- User interface needs to be simple and provide information in manageable fractions
- The software needs to provide several performance indicators that are relevant to your business
- BSC app differs in several ways. Some focus on the presentation tools like dashboards and scorecards, while others find it significant to link the key performance indicators to the strategy maps.
- User can allocate the KPIs to owners responsible for managing that specific activity
- Check for the unit types for KPI measurement like #, %, $ and more
- It needs to offer clear threshold status indicators
- To share the BSC report results the software needs to connect automatically to e-mail, which allows encouraging your staff to participate in the improvement.
Technical features to consider
- Software compatibility with your existing OS to avoid extra implementation costs
- Allows operational integration means you can connect it with extra sources to collect data like ERP system, financial statement and more
- It needs to be capable of retrieving data from 3rd party sources like Excel, spreadsheets and export data to shareholders, management boards and stakeholders
- Consider instant data sharing, which allows your staff to access information provided in the performance analysis results
Information security
Data security is the main concern in this competitive business environment. It is for this reason you may consider to process data on your local servers but sharing this information across your organization can be very expensive. Fortunately, there is BSC software, which offers internal and online data storage with significant licensing costs.