Reasons for Adoption of Dashboards, Scorecards & Performance Alerts

Dashboard Spy Update: Dear readers – sorry for the wrong URL for the “Keeping Score Survey” pdf. I’ve fixed the link. See below:

Once a business intelligence project gets underway, there is a flurry of analysis, design, construction and testing. We get so busy that we sometimes lose sight as to the reasons why we adopt our dashboards, scorecards and performance alerting systems in the first place.

Let’s take a step back and look at the reasons behind the trend of the last few years toward enterprise dashboards, executive scorecards and other performance measuring applications.

In September of 2006, the Ventana Research Operational Performance Management practice group released a survey exploring what the reasons for adoption of dashboards and scorecards were for 590 participants: Dashboard & Scorecards Reasons for Adoption.

Take a look at these images:

Scorecard and Dashboard Software

As you see, the respondents gave reasons for adoption such as better decision making, business process performance, alignment of operations with corporate goals and strategies, optimization of company resources, and benchmarking of performance against industry or for regulatory purposes.

Ventana sought to learn why companies
are deploying scorecards, dashboards and
performance alerts. The top business
driver that respondents cited for adopting
them is to align operations with corporate
strategy and goals. Approximately onethird
of companies identified this as the
most significant reason for their initiative.
It was most prevalent for scorecards (36
percent), not quite as much for
dashboards (29 percent) and least so for
alerts (24 percent)

It’s important to know how the Ventana Research group differentiated between scorecards, dashboards and alert systems. Take a look at this graphic:

Difference between bi dashboards and scorecards

Basically, a scorecard is a software app that shows progress of a company towards strategies, goals and objectives. This measurement is judged via KPIs and metrics.

A dashboard is more of an enterprise reporting application that measures performance of specific business metrics or of certain departments. The emphasis is not on a management methodology such as a balanced scorecard.

A performance alert is a communication system that transmits the triggering of a certain level, action or condition.

Tags: Dashboard Project Return on Investment, Dashboard ROI, Dashboards vs. Scorecards, Reasons for Adoption of Dashboard and Scorecard Projects.

PS. Here is another Dashboard Spy post that spoke about the rationale behind BI dashboarding efforts.

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