David Wilsey David Wilsey

David Wilsey is the Chief Operating Officer with the Balanced Scorecard Institute and co-author of The Institute Way: Simplify Strategic Planning and Management with the Balanced Scorecard.

4 Reasons Business Intelligence Systems are Like an (Unused) Gym Membership

By: David Wilsey

May 23, 2014 10924 Views 0 Comments FacebookTwitterLinkedInGoogle Plus
My business intelligence (BI) and analytics software salesman friend said something interesting to me the other day over lunch. He said, “I don't sell software, I sell gym memberships. When someone joins a gym they are not really buying the membership. They are buying the dream of improved health and a better physique. Their intention is to work out every day and fulfill that dream, despite the fact that few people ever actually follow up. Selling BI software is the same way. I'm not selling the software; I’m selling the dream of improved insight and competitive advantage.”

The unspoken implication was that few people ever get significant benefit from their software system, a conclusion I have also observed over my years in strategic performance management.

There are many common reasons that your strategic performance management software system might be getting less use than the gym membership you bought last January.  Below are the top 4 that I’ve seen as well as some tips for avoiding them.  

Reason 1: You bought into the hype but not the skills
I overheard a CEO recently saying that he needed to buy into the big data craze.  It was clear that this person had no idea what big data or predictive analytics meant, but he definitely needed to buy some.  Many people seem to think if they just buy some software, within weeks a “number cruncher” will magically come down from a mountain with answers to all of their problems. That is like thinking that if I buy a shovel, a garden will magically appear in my back yard. Performance management and statistical analysis skills are critical to creating value in this field.
 
Reason 2: You keep the results a secret
The first question some people ask when considering a performance system is, “how do I keep everyone out of my data?”  Security around private customer, employee, or some financial information is an absolute must, but a surprising amount of strategic organizational performance information can be shared with leaders and managers.  Leaders need information to make decisions and limiting access can communicate that strategy management is something to be left to only a select few.  Analyzing data is only the first step.  The dialog around why the results occurred and what should happen next are just as critical.
 
Reason 3: You only use out-of-the-box performance report design
The standard templates provided by the software companies are almost always designed to make the software sell well, as opposed to informing YOUR strategic decision making. Good performance reports communicate three things clearly: 1) How is OUR organization currently performing, 2) Why are WE getting the results that we are getting?  And 3) What are WE doing to improve our results?

Reason 4: You count and report on everything that can be counted.
Just because the vendor promises that this tool can handle the volume doesn’t mean that this is a good idea. Strategic performance management is about focusing on the most critical things first. I would recommend selecting a handful of critical performance gaps and focus your data collection, analysis, and improvement efforts on those.  Teach everyone in your organization how to do this effectively before you expand to other areas.

There are many more common mistakes, but these four are top of mind for me.  Please share other mistakes you’ve seen in the comments section below.

For more about how to improve your performance analysis, see the Performance Analysis chapter of The Institute Way: Simplify Strategic Planning and Management with the Balanced Scorecard.
David Wilsey David Wilsey

David Wilsey is the Chief Operating Officer with the Balanced Scorecard Institute and co-author of The Institute Way: Simplify Strategic Planning and Management with the Balanced Scorecard.

Navigating with the Fuel Indicator

By David Wilsey

Sep 26, 2013 4329 Views 0 Comments FacebookTwitterLinkedInGoogle Plus

Has it ever dawned on you that you think you are headed in the right direction only to discover that you are using the wrong measure to inform your decisions? It feels a bit like navigating a truck using the fuel gauge instead of the GPS.

It was a lesson that I observed again last week while presenting at the McLeod Software Users’ Conference in Scottsdale, AZ. Between a golf tournament in the 106 degree heat, a bus ride for 600 participants for a night at the Rawhide Western Town and Steakhouse, desert Jeep tours and lots of great food and speakers, the software company put on a great show. 

The part that was most exciting to me was the official launch of the new Navigator product, which is the new strategic performance management solution that McLeod has added to its portfolio of transportation management and trucking software solutions. 

The highlight of the conference was a presentation by Lee Camden, the IT Director at Earl Henderson Trucking. Henderson was the first client for which McLeod and the Institute partnered together to help with strategic planning and measurement development. I facilitated the Henderson team quickly through our planning process and the McLeod team modeled the software after the results. In his presentation, Lee demonstrated the value of the Navigator product as well as the practical benefits they have received over time from improved strategy focus. He demonstrated how they used their strategy map to visualize and align around strategy. 

He also noted how they had stopped focusing on only driver retention as their primary organizational capacity measure. A key takeaway from the planning dialog was the realization that their strategy wasn’t dependent on having just anyone driving their trucks. Simply having a driver turned out to be about as strategic as filling the gas tank.

Henderson’s strategy focused on adding specialized offerings and other premium services. In order to effectively deliver the services that they felt gave them a competitive advantage, it was critical that they have qualified “good” drivers. In order to improve on the Increase the Number of Good Drivers objective on their strategy map, McLeod has implemented an initiative around this qualification process and are now measuring their progress on this much more strategically important factor.

I look forward to catching the presentation video on the McLeod website and case study.  Both will be posted to the BSI website as soon as they are available.