Communicating Appropriate Reasons for Scorecard Implementation
While scorecard systems are implemented for a variety of reasons, to foster motivation they must be implemented for appropriate reasons.
Underlying reasons for implementing scorecard systems can be grouped into two general categories: operational and strategic. Operational reasons for using scorecards include:
Being able to measure people, projects, and strategy
Need to measure performance at different levels in the organization
Need a way to systemize existing scorecard process and provide data more frequently
Need to correlate measures
Need to enforce and monitor regulation compliance
Need to track progress toward achievement of organizational goals2
Need to link compensation to performance3
Typical strategic reasons for implementing a scorecard system include:
Need to make strategy everyone's job
Strategy and objectives are too abstract
Need to communicate strategy to everyone simply and clearly
Translating strategy into operational terms is difficult
Need to align employee behavior with strategic objectives
Need to link and align (and realign) the organization around strategy
A new business opportunity (expansion, new client, etc.) requires it
Results from the SHAPs Best Practice Group indicate that scorecard systems achieve greater success when they are implemented for strategic reasons—to support the achievement of strategy. More and more organizations are citing strategic enabling themes when stating why they have decided ...
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