Data Rich, Information Poor? Why Scorecards Drive Action-Oriented Discussion

There are many buzzwords in tech covering data. You may have heard of "data warehouses", "big data" and "data lakes" . . . but with the emphasis on the amount of data, is that what you should focus on ? What does being "data rich" actually mean? Data richness is simply having large stockpiles of data with thousands, even millions of data points. As we hear more about businesses working closely with data, it is important to realize that simply having a lot of data may not be enough to make a business successful.

It’s great to have data in every aspect of your business, but if it’s not being used effectively to make decisions or create actionable insights, it can be a costly burden, not to mention incredibly overwhelming. Databases that hold massive amounts of information are expensive and often lack organization and tools to interpret the data, which makes it a waste of time, energy, effort, and dollars to manage and maintain.

Even less efficient is manually inputted data and/or manually generated reports. The time, the chance of errors, and the opportunity cost of your workforce managing your dataset has to be considered. If the data is not driving insights that are actionable to drive better outcomes for your business, why bother?

When large amounts of data are collected every day, every minute and every second — but there isn’t a clear way to sort through or analyze it, organizations are considered data rich and information poor.

Here are some strategies to deploy in an effort to achieve information richness that leads to better decision making and growth: “The Scorecard”.

Measurement vs. Scorekeeping

First, we must understand what the differences are between measurement and scorekeeping

Measurement:

• Catches people doing it wrong

• Externally imposed

• Presented after the fact

• Forces competition

• Maximizes excuses

• Discourages ownership

• Enforces Manager goals

Scorekeeping:

• Reinforces desirable behaviors

• Chosen by the individual

• Feedback during journey

• Allows competition

• Maximizes celebration

• Stimulates ownership

• Enables player goals
  

The Importance of the Scorecard

The scorecard purpose is to create positive, actionable insights into performance with your employees. It should be a positive experience for both you and your employee and incite feedback with collaboration and clear direction on next steps. A scorecard should be focused on your employee, not others. How are they trending? Are they exceeding expectations but seeing performance suffer? Is it a new hire that is not meeting benchmark KPI’s but is trending positive? The scorecard tells a story over time.

What a Scorecard Should Reflect

A scorecard must have a few elements to ensure effectiveness. KPI’s that directly drive an impact to your business is obvious, but the data must be included over time so you can assess trends. This is critical - a singular data point that is a snapshot in time does not tell a story. It’s like reading one chapter in the middle of the book and deciding if you like it or not. We cannot emphasize enough the importance of trends. Lastly, include benchmarks relative to your KPI. What is the baseline performance, the expectation? How are they trending against the benchmark? Again, including the trendline tells more of a story than simply if they are meeting expectation or not and creates action-oriented discussion.

Communication Surrounding the Scorecard

When reviewing the scorecard (we suggest weekly) - it should be a positive experience. Even if the data suggests improvement is needed, it is not a time to erode confidence and emphasize negative feedback. Make the conversation collaborative! Be a support to your employee and coach them. This is where coaching (think Ted Lasso) comes in. Provide guidance and ask the right questions that will help your employee discover the answers for themselves. You will find that this creates more confidence, more trust, and a more engaged workforce.

In order to move in an information rich direction, organizations should prioritize putting a scorekeeping system into place. While data is collected and scorecards are developed, insights should be shared among teammates to encourage knowledge sharing that everyone can benefit from. Increased information from scorecards will help your business grow in the right direction while paving a new path that encourages information-driven decision making and proactive insights.