Should organizations try to achieve results which balance the interests of its various stakeholders? Should the dashboard metrics, or report cards, for an organization reflect that?
I am obviously a true believer of a balanced scorecard of measurements or metrics that an organization needs to focus on. From a Six Sigma perspective, we typically call this the phenomenon of “ y = f(x),” or y as function of x. “y” is the performance measurements that organizations like to focus on, but what are the critical “x’s” that drive those performance behaviors? It’s akin to an organization that’s in the business of selling lemonade. If you want to change the taste of lemonade, the “y,” the only factors you can influence [are] the type of lemons, the amount of lemons, the amount of sugar, the amount of water. So understanding what those drivers are from a balanced perspective is what organizations need to figure out. I call that somewhat of a balanced scorecard approach. As I referred to earlier, if you have pockets of high employee turnover, obviously it’s going to have an adverse impact on the financial performance of the organization. So an organization can’t just focus on financial performance alone.