The Value of Scorecarding

21 04 2009

One of my first Scorecard exercises is one of my favorites.  It taught me a great deal about the power of scorecarding.  I did what I suspect most people do.  I interviewed all the VPs and developed a long list of KPIs.  I then used an excel spreadsheet to organize the KPIs.  I put the KPIs down the rows, and theVPs across the columns.  Then to help visualize the data, I placed “red” cells where VPs were directly impacted by the KPIs and “yellow” cells where the VPs were indirectly related.  I did not intend the colors for anything other to call out attention for each of the VPs.

By choosing the “red” and “yellow” I had each of the VPs concerned that they were under performing in each of those areas.  I had to explain a number of times, the reason for the colors.  
  • The first lesson was that by associating colors with performance, I clearly had the attention and focus of the executives of this team.  It sparked a number of very strong conversations about performance.
  • The second lesson is that communication is just as important.  By doing a less than stellar job of communicating (at least from a visual sense) the information, I wasted a tremendous amount of time that should have been used for more strategic discussion.  

Scorecarding can be a very powerful tool, but it needs to be used appropriately.

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