The Basics in Developing the Balanced Performance Scorecard

The overall success of any company is significantly influenced by the performance of its workforce. Even if your company has the latest in terms of software, gadgets, and all sorts of programs, all of these would not garner that much profit and success without the efforts exerted by your employees. Thus, there is a need to monitor the performance of your employees. And if you want to employ a systematic approach to measuring performance, then you should develop and implement the use of a balanced performance scorecard. With this systematized tool, performance can be accurately measured and this, in turn, can then be used to deal with whatever issues that need to be remedied in the process.

For the scorecard to be as effective as it should be, it has to contain key performance indicators and metrics, which are quantifiable measures that you can use to gauge performance accurately. To do this, your company has to set all standards pertaining to the things that need to be done to achieve corporate goals and objectives. These standards would then be translated to KPIs or key performance indicators. For the most part, companies measure the performance of their employees every end of the month and this is done through the documentation of achievements and errors as well as coaching and training programs that the employees have undergone.

If you are not too sure what particular KPIs to use for your performance scorecard, do not panic just yet. There are so many sources that you can get over the net or even from business magazines and books that you can find in your local library. All you really need to do is find the ones that are relevant to the goals and objectives that your company wants to achieve. Just a chosen few would do because having too many KPIs would just complicate the process. To get you on the right track, here are some of the KPIs that are commonly used to measure performance: attendance, productivity, behavior, and core values.

It is also very common to find companies that make use of 5-point scales in measuring performance. Usually, 1 would be the lowest score while 5 is the highest. Let us take attendance into consideration for this scenario. If an employee has one absence in a month, then this would give him or her a rating of 4. If the employee has two absences, then the rating would drop to 3. When you already have the rating, you then multiply it by its percentage equivalent using performance metrics. Let us suppose attendance comprises 30% of an employee's total performance. The rating of 3 would then be multiplied by 30%, thereby giving you the percentage equivalent of 0.9. This figure would then be added to other KPIs plotted on your performance scorecard. In general, the ideal summed up equivalent would be a score of higher than 5. The usual passing score would be either 2.5 or 3.

These are just some of the aspects you should consider when plotting out your balanced performance scorecard. Now that you know the basics, it should not be too difficult for you to develop one of your own.