In a short, but insightful, piece called ‘What’s Missing from Your Scorecard?’ Mark Graham Brown suggests eight categories of metrics which should be better represented on a balanced scorecard:
- Customer aggravation
- External factors
- Employee satisfaction
- Brand image
- Customer attractiveness and relationships
- Communication effectiveness
- Employee health and safety
Mark’s issue with employee satisfaction is most companies measure it annually which provides little opportunity to take action on the findings. While I agree, I also worry about organizations that use proxy measures of satisfaction like average length of service or retention. To make matters worse, as I discovered in my own career, many employee satisfaction surveys suffer from the Coke vs Pepsi problem.
I also like Mark’s suggestion on brand image. Instead of the traditional brand surveys (which are also measured annually), use a sentiment analysis tool to listen to the voice of the customer. This can provide an early warning radar for topics or regions might have pending issues.
From my point of view, the other thing missing from most balanced scorecards is focus. Too many scorecards are littered with metrics with little strategic value that appear largely because they are easy to measure, rather than because they provide insight into an organization’s performance. As I frequently remind people, “not everything that counts can be counted and not everything that can be counted, counts.”
There may be metrics missing from your scorecard but you don’t want too many of them. My advice: twenty is plenty.
(Note: Mark’s article provides a great example of measurement missteps at a fried chicken franchise. By focusing on an efficiency metric at the expense of customer satisfaction, one store owner came out looking like a turkey.)