To be effective, a scorecard has to be used top up and bottom down, and not just as a measure of organizational performance, but as a showcase of underlying causes, according to one analyst.
And according to Alan Missroon, vice-president of marketing for CorVu Corp. in Minneapolis, his company’s software addresses those issues.
Henry Morris, vice-president for data warehousing and applications at International Data Corp. in Framingham, Mass., said that if all a scorecard does is “measure performance then that is somewhat limited.
“You have to understand what is necessary to get down to the next level, what the causes are…if you don’t have the research to support that then you just say, ‘Gee, isn’t that too bad,'” Morris said.
According to Missroon, unlike simple performance measurement systems, CorVu’s Balanced Scorecard software “is a performance management application in that it takes specific metrics and ties them directly to a specific strategy and then correlates those strategic initiatives to detect what cause and effect relationships [exist] between them.”
CorVu’s Balanced Scorecard tool, which can be integrated with IBM’s DB2 Universal Database and DB2 OLAP Server, enables organizations to measure, analyse and manage both financial and operational performance. According to the company, it can help communicate vision and strategy throughout the organization, translate strategic and corporate objectives into individual performance measures and offer every employee a blueprint for contributing to the corporate vision. It also links performance results with the processes that drive them.
Correlation analysis is performed when users view scores to measure strategic initiatives and monitor when performance improves in one area and decreases in another.
This is where integration with IBM’s DB2 database come into play, Missroon said. In companies which store performance data – customer service, financial information, inventory management – in DB2, “we’re linking this application with native connections right into DB2 so we’re pulling the performance data directly out of their existing system.”
Features of the software include communication and feedback capabilities, information analysis through graphs, gauges and reports, integration of quantitative and qualitative measures, as well as a component-based design that enables organizations to create a library of metrics from which scorecards are assembled.
Lieutenant Colonel Don Venn, chief of strategic management and innovation divisions at the Georgia Department of Defense in Atlanta, said his department looked at a balanced scorecard system because the state department head wanted “a means of getting a quicker electronic look at where our army and our air units stand with regard to certain metrics.”
The organization wanted to come “closer in line with the way businesses are conducting business,” Venn said. The department looked at different software products but “CorVu was settled on because it does the most of what we were looking for a product to do at the best cost,” he added.
“As a military organization we have lots of information coming to us from a myriad of databases…we realized CorVu had a product that allowed us to create a balanced scorecard using key process areas and tap into the data.”
One of the functions the department found appealing is called executive alert. According to Venn, this allows them to display data in a dashboard format that indicates status with green, amber or red indicators. If a process area shows amber or red, Venn explained, “CorVu provides the ability to drill down with a few clicks of the mouse to identify where the problem is.”
According to Corvu’s Missroon, another advantage to the product is the “electronic bulletin board” that facilitates communication and feedback.
“It associates any comments that users choose to enter with a specific period of performance. Comments are entered by a user, the screen itself that they use to enter comments looks pretty much like an e-mail screen. You put your name in, your subject in and type in your comment.”
This enables senior management and employees to analyse performance for a particular time period and view each other’s comments.
According to Missroon, the only technical issues involved are accessing data. While it is very easy to get at data in the DB2 environment, “there will still be some external kinds of measures, things that might not come from the operational system of the company that may be captured on the Web somewhere or captured in some sort of ASCII format. We do also integrate those…we simply have to identify where the information is going to come from.”
Pricing for CorVu’s automated Balanced Scorecard software (www.corvu.com/scard/product.htm) was unavailable.
CorVu in Edina, Minn., is at (612) 944-7777.