Basic Documents

The 2014 Balanced Scorecard survey was a joint effort between 2GC Active Management and Intrafocus. Using two companies with different approaches to the market to conduct the survey has resulted in a much more ‘balanced’ result (forgive the pun). One of the surprising insights was the number of respondents who admitted they do not use a software tool to manage their scorecards but instead use basic documents. In past surveys, Intrafocus noted that the percentage of respondents using basic documents was around 12%-15%.  In the latest survey this number is 29%.

It is unlikely there been such a large increase in the number of organisations using basic documents to report on their Balanced Scorecards. It is much more likely that the either 1. The question being asked was different or 2. The target audience has changed. In reality, it is a combination of the two factors. The question being asked had a different emphasis and the target audience, as mentioned above, was more balanced.

However, the interesting fact remains: 29% of the respondents manage their scorecards using basic documents and PowerPoint presentations. In a world where business automation and integrated communications (both internally and externally) is paramount, is this reasonable? As a strategy management software vendor, one might expect Intrafocus to start the discussion by saying no, this is an unsustainable situation. Of course it is not as simple as that.

Use of software, in any field, is only worthwhile if the business process is fully understood and the information being added to the system is sound. One of the great things about using documents and presentations to manage a business is the ‘discursive’ element required to interpret what is being reported. This can work very well in an environment where everyone is on board and headed in the same direction. One of the biggest problems with a software solution is “garbage in = garbage out”. In other words, if the information added to the system is not sound, then the system will do little more than re-present the unsound information in a different way. This can then lead to the additional problem of statements like “the system tells us that…” giving rise to the belief that ‘the system’ is infallible!

Software only becomes useful when an underlying business process is fully understood. Many software products have built in business processes that can guide users who are unfamiliar with industry best practices. It is reasonable to migrate to a software solution while running the existing document/presentation solution in parallel. In fact this is often the preferred method of transition.

Moving to dedicated strategy management software or balanced scorecard software package is often a real eye-opener to organisations that only have basic processes in place. Many organisations have got to grips with day to day operational matters but have not had time to tackle strategic matters in a formal way. Instead they rely on annual off-site strategy meetings or executive away-days. These will energise the top management group for a while, but it does not take long for the day job to kick-in and strategic thoughts to be lost (especially if they have only been recorded on white boards and yellow stickies!).

Moving to a software solution from simple documents needs careful thought. First to consider the business process or methodology that will be used. In strategic management, the Balanced Scorecard methodology is probably the most well know and is used by more companies that anything else. Balanced scorecard training is widely available and underwritten by the Balanced Scorecard Institute. Once trained in an approach, the selection of software becomes vastly easier.

Next week we will look at some of the things that need to be considered when selecting Balanced Scorecard Software.



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