Leaders Need Both Dashboards and Scorecards
In the seemingly complex world of performance management, the best leaders rely on two important, but different, reporting tools to improve effectiveness: Dashboards and Scorecards.
Both tools monitor performance by aggregating data across the enterprise. Both instruments create the critical intelligence from which leaders can strategize and introduce change. However, they are distinctly different collections of data and serve distinct purposes.
Dashboards are typically visual representations of key performance indicators reflecting the day-to-day operation activity or output. They offer a quick snapshot of what is happening now. To be valuable, this instant review of daily results needs to be updated constantly, and the entire team should refer to it to understand what is going on today.
Scorecards, on the other hand, track progress by comparing strategic goals with results. They reflect the general health of the enterprise and give leaders a forecast of the future, presuming no changes are made. Updated weekly or monthly, Scorecards allow leaders to focus with precision on what needs to be done to improve performance.
Think of a Dashboard as daily precipitation and a Scorecard as the accumulated rain necessary to sustain the community with water. Organizations and teams need both.
Dashboards keep teams on task and give team members a sense of everyday purpose. By reflecting what is happening today, leaders can pinpoint issues before they become a problem.
Scorecards allow leaders to assess the quality of the enterprise and the soundness of the current strategy. By reflecting the health of the enterprise, leaders can make changes when they notice negative patterns that deserve attention.
Operating a business or enterprise without a Dashboard is akin to flying a plane without any instruments. Strategizing without a Scorecard is akin to flying without knowing where you might land. Getting both analytical tools in good order is a job good leaders take seriously. The ability to succeed usually depends on it.