The final formula for the total performance index of the scorecard will be: To calculate the total performance within all categories, it’s necessary to summarize performance values for all levels: Where N i is the number of metrics on i-level NW i,j – is a normalized weight of j-metric on i-level NS i,j – is a performance of j-metric on i-level. The total performance value for the selected category is to be calculated as: We had our weight on a scale 1.10, so before moving ahead, we need to calculate a normalized weight:
Let’s convert this into a different notation: Metric-i,j are our indicators together with their weight and performance values: Here we have the structure of the scorecard where C1.4 – are containers. Now, let me show the math that stands behind the calculation of the total performance. How the Scorecard Performance is Calculated It might be hard to find the business meaning of the total scorecard index, but for sure, it makes sense to calculate the performance of specific containers.Īs in the example above, the performance level of the “Customer support” container has two weighted indicators: “Average email response time” and “First contact resolution rate” that will actually show if customer support does a good job balancing response quality and response time.
An opposite argument is that this aggregated index will be too complex to possibly give any meaningful information.Some say that they need to have “a number” that is supposed to reflect the current performance of the company.
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