QPR ScoreCard. White Paper. QPR ScoreCard - Balanced Scorecard with Commitment. Copyright 2002 QPR Software Oyj Plc All Rights Reserved

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1 QPR ScoreCard White Paper QPR ScoreCard - Balanced Scorecard with Commitment

2 QPR Management Software 2/25 Table of Contents 1 Executive Overview Implementing Balanced Scorecard with QPR ScoreCard Benefits and Features Communication Navigation and Analysis Visualization Graphical Scorecard View Strategy Map Measure details Textual Information Effective Collaboration Commenting and action planning integration Alarming Developing the performance measurement framework Customizable Measurement Framework Defining Organizational Structure Scorecard Structure Efficient Calculation Engine Integrating data with the existing systems Organizational Integration Scalability...20 Appendix A: Technical Information...22 Appendix B: References...25

3 QPR Management Software 3/25 1 Executive Overview The Balanced Scorecard (BSC) is a management system that enables organizations to clarify their vision and strategy and put them into action. When fully deployed, the Balanced Scorecard transforms strategic planning from an academic exercise into the nervous center of an enterprise. Many Balanced Scorecard applications have been paper- or spreadsheet- based. While relatively easy to implement, they are labor-intensive causing hidden costs. Also, as more information is added into a large corporate wide system, such manual or semi-automatic systems will eventually collapse. QPR ScoreCard is an automated software solution for implementing Balanced Scorecard and strategic performance measurement and management. It is an optimal tool for organizations to successfully plan, implement, communicate and commit people on organizational strategies and objectives. Fast implementation and effective communication of strategy QPR ScoreCard provides you with an incredibly quick and easy way of implementing a Balanced Scorecard or any other performance management system. Efficient and automatic web publishing brings personalized strategic objectives to every employee s desktop. You will achieve concrete results from the very beginning of your implementation process. Easy-to-use, scalable solution One of the design goals of QPR ScoreCard was to deliver an application that is easy to use and still scalable from standalone to corporate-level system. This goal has been achieved by combining the power of visual scorecarding and the ease of web-based utilization and selecting the latest proven technology for scalability. Seamless integration with other systems QPR ScoreCard can be seamlessly embedded to your corporate look and feel. It can be integrated to your existing IT-infrastructure and data to enable automated updating of scorecards. Low total cost of ownership and high return on investment With minimal IT-administration required, there are virtually no running costs for keeping the system up and running. By implementing QPR ScoreCard you will have less meetings and less time spent in information gathering and delivery and more time for analyzing and thinking. Is your strategy crystal-clear to everyone in your organization? Has your strategy really been turned into action? Is everyone in your organization committed to implementing your strategy? This document will outline what QPR ScoreCard can do for you. QPR ScoreCard Balanced Scorecard with Commitment

4 QPR Management Software 4/25 2 Implementing Balanced Scorecard with QPR ScoreCard The implementation of a BSC should always be organized as a separate management development project. The project should be planned in the same detail as any other project in the organization and standard project management procedures should be followed. The actual implementation of a Balanced Scorecard can be divided into four phases: Model Synthesis, Technical Implementation, Organizational Integration, and Technical Integration. Many of the above phases can be performed parallel. This will shorten the total lead time of the project significantly. Balanced Scorecard Implementation Model Synthesis Organizational Integration Project Planning Technical Implementation Technical Integration During the Model Synthesis phase the organization seeks consensus about their vision and strategy and derives the needed measures. Furthermore the strategy of the organization is quantified into measures or Key Performance Indicators (KPI's). The measures can be derived from the strategy using Critical Success factors (CSF's) or alternatively using Strategy maps. The key properties, such as unit and frequency of measuring, of each of the measures in a Balanced Scorecard are also defined. In the Technical Implementation phase, the visions, strategies, critical success factors, measures etc., are entered into the automated BSC system. The technical implementation steps include installation of the software, training, building of the scorecards, setting target and alarm levels and setting data consolidation rules as well as defining graphs and views to the BSC information. For fast implementation and high-quality results, Model Synthesis and Technical Implementation should be done simultaneously to build the Balanced Scorecard incrementally. The objective of the Organizational Integration of the Balanced Scorecard is to integrate it with the management and reporting processes of the organization and communicate the BSC to all the members of the organization.

5 QPR Management Software 5/25 Technical Integration is performed to reduce the effort needed to collect measure data. The Balanced Scorecard system is integrated to operational IT systems, databases and/or data warehouses such as financial reporting systems, Enterprise Resource Planning (ERP) systems or Customer Relationship Management (CRM) systems. How to benefit? The benefits of Balanced Scorecard are fully realized when it is used in everyday operations. Data update, analysis and reporting are performed regularly within the management and reporting processes. From time to time it is also necessary to revise and validate the structure of BSC. QPR ScoreCard is designed for being used as a standard everyday tool used by the management team in designing and implementing the strategy. Balanced Scorecard Utilization Set Targets Operate Update Revise and Validate Communicate Analyze and Review

6 QPR Management Software 6/25 3 Benefits and Features This chapter gives you an insight to the benefits and features of QPR ScoreCard. In the chapters , you will see how to benefit from utilizing Balanced Scorecard or any other performance management framework with QPR ScoreCard. Chapter 3.5 will show you how to do the implementation. In Appendix A, you will find the technical information on architecture and requirements. 3.1 Communication QPR Portal provides you with an instant up-to-date delivery of management information. QPR Portal combines business process management (QPR ProcessGuide) uniquely with Balanced Scorecard (QPR ScoreCard) into a simple and personalized web interface. QPR Portal contains quickly selectable viewpoints to information relevant to you. Home Page - The opening page shows corporate information common to all users. What s New - Shows the changes in the scorecard after your last login to the portal My Elements - Shows your own measures, the action plans allocated to you and comments to your measures as well as the comments you have added. My Views Shows you a list of different views you have bookmarked. Adding bookmarks helps you to get easily into the information that you have the most interest in. My Links Add any type of bookmarks here, also to external sources like your intranet or web. Reports Shows folders of up-to-date reports of QPR ScoreCard information, or any other data you might think of such as financial statements.

7 QPR Management Software 7/25 Search Use the search option when you want quick results for some keyword from your Balanced Scorecard or processes. 3.2 Navigation and Analysis To fully utilize the different viewpoints of QPR Portal, QPR ScoreCard offers a navigator view that you can use to explore the information and then add link to your favorites. This view offers also the drill-down and analyzing capabilities to all kinds of information in your performance measurement model. In the navigator view you have the whole scorecard hierarchy on the left side of the screen and element hierarchy of one scorecard on the right side. To the elements in a single scorecard, you have multiple options to show different kind of information from the dropdown lists. This is a perfect view for comparing the status of different measures with the color codes provided. As you find a suitable view (configuration with the dropdown lists), you can bookmark that to your views in the portal. From the navigator view, you will also be able to drill down to individual measures, strategy map and graphical scorecard view as well as various views listing the different kinds of elements. The organization hierarchy with dynamic drill-down capabilities. Perspectives, KPI s and measures in a hierarchical view of a single scorecard. The hierarchical view allows dynamic drilldown from top to bottom, providing you with analysis of values with symbols, colors and a trend arrow. In addition, from the drop-down lists you can select the period you wish to analyze and many kinds of information, i.e. vision, strategy, comments and action plans attached to elements in the hierarchy.

8 QPR Management Software 8/ Visualization Graphical Scorecard View Graphical scorecard view offers the simplest representation of a scorecard status. This view is very easy to understand you have the traffic lights, gauges, or a desired symbol (like happy or sad face) indicating the status of a measure. Scorecard view offers many different kinds of value indicators and graphical representations Strategy Map Strategy map view offers the definition of cause and effect between different elements in a scorecard. This helps people to understand the strategy - how focusing on some area affects other areas and more, the software actually calculates the correlation factors between the elements showing you how well your strategy is succeeding.

9 QPR Management Software 9/25 Mapping the strategy helps people understand why we do something. Cause-effect relationships show the correlation between different key performance indicators

10 QPR Management Software 10/ Measure details From all of the views, you can drill down to measure details. In an element view you get the indicator and history chart of the element as well as other detailed information. You can set alerts to follow the measure, you can set targets or actual values to the measure, and you can comment and make action plans to it. Possibility to enter comments or action plans here You can set targets, alarms and actual values here Recent action plans and comments are available here History chart and indicator give you an overview of the current situation, historical data and the future targets

11 QPR Management Software 11/ Textual Information You will be able to attach textual information in multiple different ways each quantitative element may contain textual elements or information links to external data. In addition to this, you will be able to take advantage of the built-in file storing and web publishing system. These files are available in QPR Portal reports section. The textual elements are typically written descriptions of company vision or strategy. 3.4 Effective Collaboration In addition to just viewing the different data on the web, QPR ScoreCard offers many ways for efficient communication. support is fully enabled in terms of commenting and exception alarming. System supports also commenting with an opinion scale and action planning Commenting and action planning Comments and action plans are linked to quantitative (i.e. measures) and textual (i.e. vision description) elements. With comments you can, for example, organize opinion polls. Enter action plans directly on web client and get instant results by informing the responsible via

12 QPR Management Software 12/ Integration integration provides you with the possibility of sending directly to people responsible for their measures or actions. In addition, once you submit a comment or an action plan, you can notify the persons in charge instantly via to get their interest without having to log into the system Alarming QPR ScoreCard includes a flexible notification system. You can get an alert when a measure goes to a certain range, or to notify when to enter values manually. Different alarming options Recipients for the notification users or even whole groups

13 QPR Management Software 13/ Developing the Performance Measurement Framework An easy-to-use Windows application, QPR ScoreCard Development Client is used to build the performance measurement framework. In performance measurement framework, the modeling procedure does not require any additional IT-skills or excess consultancy. With the Development Client, doing this is a fairly intuitive and easy task for anybody who can use Windows applications Customizable Measurement Framework The measurement framework in QPR ScoreCard is fully customizable to your needs. The foundation for the model is done with few key concepts on the meta-level. These concepts include element types (what to measure), value settings (how to measure) and period settings (when to measure). What to measure? Framework consists of certain meta-elements like element types in addition to standard element types like Strategic Objective that you find in the various model templates provided with the installation, you are able to define your own types. Characteristics of these types can be defined individually such as types of icons in the end-user interface. How to measure? The value settings concept defines how to transform the numeric data into color indicators. Also, with the value settings you can define what kind of series (like actual values, forecast and trend) you will be utilizing. With the range definitions (in the image below, the color indicators) you can define what color or numeric value a measure gets once it has a certain

14 QPR Management Software 14/25 value relative to target or alarm. Also, the ranges are powerful tools when consolidating and normalizing information from many different types of measures when used in calculation. When to measure? The period system can be fully configured to your needs even from yearly measures down to daily measurement. All of these period levels (quarter, year etc.) can be fully taken into account in calculations and users can evaluate the results of measurements in any level.

15 QPR Management Software 15/ Defining Organizational Structure Typically, defining the model starts from defining the organizational structure. In the model navigator, you can create an unlimited number of scorecards. Scorecards are containers for quantitative elements. There can even be scorecards down to individual level. The measurement information in each scorecard can be consolidated upwards by enabling this the changes in bottom level scorecards have a cause-effect relationship with the corporate level scorecards Scorecard Structure All the measurable elements in each scorecard (i.e. key performance indicators, measures) are built on a hierarchical model. The hierarchy reflects the lowest level consolidation of measurement information.

16 QPR Management Software 16/ Efficient Calculation Engine The calculation engine in QPR ScoreCard gives you the freedom of setting up various types of consolidations between the measures and an ability to create different types of statistical series for single measures based on the actual values. In addition to the standard arithmetic operations, the calculation engine has over 40 built-in functions (including various types of mathematical and logical functions).

17 QPR Management Software 17/ Integrating data with the existing systems QPR ScoreCard can be effectively integrated with existing systems. This means that QPR ScoreCard can be incorporated into an organization seamlessly and gradually. Furthermore, integration has the additional benefit of keeping historical data available for immediate use. QPR ScoreCard supports data imports from files, excel sheets, SQL databases and OLAP databases.

18 QPR Management Software 18/ Organizational Integration User interface customization By customizing the end-user interface to look exactly like your corporate intranet, you will easily achieve organizational buy-in for the balanced scorecard. In addition, if you wish to use some other portal solution, it is possible to get bits n pieces from QPR ScoreCard web client individually.

19 QPR Management Software 19/25 Integrated reporting In addition, you can integrate your existing reporting system with QPR ScoreCard by using its web file publishing feature. Publish any reports or files through QPR Portal. User rights can be set for each report or folder. Flexible user management and security

20 QPR Management Software 20/25 All the users in QPR ScoreCard can be integrated with your existing LDAP or NT Domain compliant user management. These systems include such as Windows 2000 Active Directory, Windows NT, Lotus Notes and OpenLDAP. The user rights in QPR ScoreCard can be defined per user and per group basis down to object level and with four main categories: none, view, update and full rights Scalability A single QPR ScoreCard system supports up to thousands of end users depending on the hardware configuration. In large organizations, however, it is sometimes feasible to distribute the balanced scorecard perhaps to different continents. Sometimes it is good to have different server sites that serve only certain geographical region.

21 QPR Management Software 21/25 QPR ScoreCard system supports this distribution of server sites by having replication capabilities among different servers. This gives you true scalability from standalone system to global solution for performance measurement and management.

22 QPR Management Software 22/25 Appendix A: Technical Information System Architecture QPR ScoreCard is built on top of multi-tier architecture to enable maximum scalability with minimum IT-administration. The system components server, clients and database - can all exist in distributed locations. This architecture enables various workstation users to view and modify a data simultaneously. Changes made to the data are updated on each user s desktop in real-time. Following figure illustrates the relation of different modules in QPR ScoreCard system.

23 QPR Management Software 23/25 System Requirements and Recommendations Due to the choice of architecture, QPR ScoreCard requires a database system. To enable utilization of existing IT infrastructure, various industry standard database management systems are supported. Supported databases: Oracle Microsoft SQL Server IBM DB2 Microsoft Access (recommended only for standalone or evaluation usage) Supported operating systems for server components All major Microsoft Windows operating systems running on Intel platform For the web server, any operating system that has CGI-binary compliant web server software. CGI-binary is provided as a Windows executable or alternatively as a perlscript. Supported operating systems for clients Development Client can be used in all major Microsoft Windows operating systems running on Intel platform. Requires at least 56kbps connection to the server. Web Client can be used with Internet Explorer and Netscape on any major operating systems. Specific information can be found from QPR ScoreCard Administrator s Guide [1] Recommended Hardware Configurations Due to the nature of multi-tier software, exact hardware requirements for all configurations cannot be given as the systems can vary much and the same servers can be shared with many different applications. However, if a dedicated server is used for QPR ScoreCard, i.e. all components, including database system and web server are on the same server, following guidelines can be given. QPR ScoreCard System Hardware Requirements: Windows NT / 2000 / XP with 512MB of memory, 2GB disk space, 1-2 processors with at least 500MHz clock-speed

24 QPR Management Software 24/25 QPR ScoreCard Standalone Hardware Requirements: Windows Operating System with at least 64MB of memory and 200MHz processor. In hardware configuration, it is wise to keep in mind that BSC implementations often grow in terms of model size and user count. For this reason, servers that allow sophisticated capabilities for expansion, is always a good choice. For example, the standalone version can be easily run on a single laptop. Integration with Other Systems With SQL import, QPR ScoreCard can be integrated with any ODBC-compliant data source. Any Microsoft OLE DB for OLAP compliant data sources can be used for OLAP import. User management can be integrated with most of the NT Domain or LDAP-compliant systems, including NT authentication, Microsoft Active Directory, Lotus Notes and OpenLDAP.

25 QPR Management Software 25/25 Appendix B: References [1] QPR ScoreCard Administrator s Guide This document is included in installation CD and also available from All product names referenced herein are trademarks or registered trademarks of their respective companies. QPR Software Plc. disclaims proprietary interest in the marks and names of others. Although QPR Software Plc. makes every effort to ensure that this information is accurate, QPR Software Plc. will not be liable for any errors or omission of facts contained herein. QPR reserves the right to modify specifications cited in this document without prior notice. Companies, names, and data used in examples herein are fictitious unless otherwise noted. No part of this document may be reproduced or transmitted in any form or by any means, electronic or manual, for any purpose, without the express written permission of QPR Software Plc.