When teaching the foundational tools to EOS clients, the Scorecard is one of the first tools we implement. When explaining that it is a tool to give the ability to make decisions based on data, clients often respond that they already have a dashboard for this.
So, what’s the difference between the two?
One of the main differences is that usually, a dashboard will focus on outcomes in real-time, at the present moment. For example:
- What is the current value of our sales pipeline?
- How many outstanding tickets are in our support queue?
- What is our current cash position?
They’re all great things to measure, but all have one disadvantage: they’re lagging indicators – by the time you see them, it’s too late to do anything about it.
If your pipeline is £100,000 too low, you’re probably not going to be able to influence it this month. If your cash position is poor, there probably isn’t an immediate fix.
Scorecard items, however; as defined by EOS are “forward-looking, activity-based numbers, with weekly goals, which lead to desired outcomes.”
Sticking with the pipeline example, by documenting each stage of the sales process, and the action that occurs at each stage – you can identify which leading indicators can be measured in order to predict the pipeline position before it actually happens.
For example, it is likely that the number of qualification calls happening on a weekly basis will ultimately be indicative as to the pipeline value in the future. Therefore, if you measure the number of qualification calls weekly – if this number drops, you can react before your pipeline disappears.
You should keep a scorecard for every department of your business including the likes of sales, marketing, operations, finance, HR and IT.
Why should I use a scorecard?
There are three main benefits that come from using scorecards throughout your entire business:
- Individuals have a clear understanding as to what is expected of them by management
- People begin self-managing against these scorecard metrics. The scorecard helps encourage the right behavior
- If you end up off-track, you have the ability to get them back on track within a week, rather than having to double down next quarter.