Measuring the right activities today can tell you where your business is going tomorrow
Being in the right place at the right time isn’t always a matter of luck. Organizations that adhere to the principles of the Entrepreneurial Operating System (EOS) use a powerful tool which allows them to take the pulse of their business and know exactly what’s going on right now, in order to make validated and proactive actions for the future.
The EOS data scorecard tracks the activity of five to 15 areas of your business. A single person reports on each area of activity, which creates considerable focus and accountability. It’s a one-page sheet that reports the health of your business.
Weekly tracking of this activity creates a record of what his happening right now. You can use it to gain insight into what is about to happen based on the current activities of your business. With this data scorecard, you can engage in predictive analytics.
CIO defines predictive analytics as looking at current and historical data to detect trends and forecast what should occur. The data allows organizations to exploit the patterns and use them to detect both risks and opportunities. Your data scorecard allows you to move past analyzing what’s actually happening and detect future trends or upcoming behaviors.
Business reporting software creator Malartu points out that detecting patterns can only happen when you place a deep focus on this information. The purpose of your scorecard isn’t to collect the data, but to retain what it teaches you and act on it. They use the term “data disfluency” from author Charles Duhigg’s book Smarter, Better, Faster. Understanding data, Duhigg writes, requires us to transform it into experiments to
Gino Wickman’s seven basic truths about the data scorecard
EOS Worldwide founder Gino Wickman observes that the data scorecard’s value as a tool works only if you put the effort into creating and maintaining it. Making it work, he says requires you to subscribe to seven basic truths:
- What gets measured gets done.
- Managing metrics saves time.
- A scorecard gives you a pulse and the ability to predict.
- You must inspect what you expect.
- You can have accountability in a culture that
ishigh-trust and healthy.
- A scorecard requires hard work, discipline,
andconsistencyto manage, but it’s worth it.
- One person must own it.
Wickman offers explanations for each basic truth in his post, with the preface that you’ll find it difficult to manage your data scorecard if you don’t believe in all of them.
Less is more
Blogger and EOS practitioner Brent Weaver
Too much data, Weaver says, can be a disservice because it’s difficult to influence. He recommends that your scorecard feature what he calls “the essential few that if improved – could dramatically change your business for the better.”
Many organizations, observes ArrayFire CEO and co-founder John Melonakos, measure only things that tell you the trailing
Melonakos recommends undertaking an exercise where you imagine you are cut off from all knowledge of your business except for the five to 15 numbers you select. What would you want those numbers to measure? Brent Weaver agrees, saying that your scorecard will be unique. He admits to discarding numbers he’s tracked, calling the selection an “evolutionary process.”
Dallas-based consultants Whittle & Partners moves it past selecting what to measure, saying that these numbers should answer a simple question: “Did my team have a damn good week last week?” An effective scorecard evaluates whether your organization actually did those critical few things you’ve all
Your data scorecard will require regular effort to maintain it. One person will own it, but everyone will contribute to it. And believe in it. As Gino Wickman puts it, the tenacity your data scorecard requires enables it to evolve over time into an incredibly valuable management tool.