Monitoring Performance and Tracking Progress with BSC Designer

The daily routine of an executive consists of two major goals:

  1. Monitor the current state of the business. If something goes wrong an executive needs to find out the reason and plan a response.
  2. Execute a business strategy, e.g. execute an action plan that will help a company achieve its business goals. In this case it is necessary to track the progress towards the target.

Monitor KPI, plan action and track progress

In both cases a KPI will help. Let me show how it is possible to solve monitoring and progress tracking tasks by using BSC Designer software.

Key Performance Indicator (KPI)

A KPI in BSC Designer has the following numeric values:

  • Current value
  • Min/Max values
  • Baseline/Target values

BSC Designer uses these values to calculate the performance and the progress:

  • According to the min, max and the current value the program calculates the performance.
  • According to the baseline, target and the current value the program calculates the progress.

Calculate performance and progress

Obviously, the value of some KPIs need to be increased (like “% of successful conversions”), and the value of some KPIs need to be decreased (like “Return problems rate”). For this purpose in BSC Designer there is an “Optimization” dropbox where you can choose how the program should interpret the values.

Monitoring

The first goal is the monitoring of the current state.

1. Specify min and max values for the KPI

2. Enter the current value in the “value” field

Now, if you will change the current value of the KPI, BSC Designer will show the current performance in the “performance” column.

Track the progress

If the business strategy is executed properly the value of the KPI will grow according to your plan.

1. Select a KPI

2. Click “Formula” button next to the “Target” field.

Plan the target value for reporting period

3. Specify there your start and end dates, initial value and the final value that you plan to achieve.

4. Specify the reporting period, which tells how often you are going update the KPI.

Target plan dialog

5. Click “Preview” and control planned values and dates once again.

Now, when you will choose a date in the calendar and update the value of the KPI, BSC Designer will show your current progress in the “Progress” column.

An example

Let’s take “Return problems rate” KPI for an example. First we start with defining a KPI.

Monitoring

We can measure the number of return problems compared to the number of problems solves. For this example let’s take the following value:

  • Current value: 25%

To understand our current performance we need to specify a realistic interval of min and max values:

  • Min value: 5% (let’s be realistic)
  • Max value: 30% (according to benchmarking or historical values)

It is obviously that our goal is to minimize the “return problems rate,” so for the optimization method we choose “Minimize.”

I entered all the data into BSC Designer and it calculated the current performance, which is 20% and according to the current program’s settings this performance is in the red zone, so the stop-light of the KPI is red. If the current value is changed, we will see the change of the performance and the stop light color.

Tracking progress

In this example the strategy of the company is focused on improving customer satisfaction. One of the drivers of customer satisfaction is low “Return problems rate.” Executives of the company plan some initiatives that will help to improve internal processes and as a result decrease the value of this KPI.

A company has planned improvement initiatives that are supposed to decrease the value of the KPI down to 5% during 6 months. The KPIs need to be updated monthly.

You can choose now one of the options:

  • Specify the target value for the end date. In this case your progress towards the target value and performance will grow slowly from 0% to 100%; the color of the stoplight will change slowly from the red to the green zone.
  • Plan the target value for each reporting period. In this case if you are doing everything according to the plan, the progress of your KPI will always be in the green zone. The performance value will grow and the stoplight color will be changed from red to green.

In planing target values in BSC Designer we need to do the following:

1. Select “Return problems rate” KPI.

2. Click “Formula” button next to the “Target” field.

3. Specify “Initial value” as 25 and the final value as 5.

4. The start date will be today and the end date will be + 6 months.

5. The “step, days” is the reporting period which is 30 days.

6. Click “Preview” button to review and confirmed planned values.

For each reporting date a new target value was specified. Now, when a user updates a KPI, a respective update will be displayed in the “Progress” field in BSC Designer. If you are on the schedule, then the progress value will be always near the 100% value and the performance value will be improving slowly.

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