1 February 2016

Hints and Tips To Build a Metrics Project With IBM Cognos Metrics Studio 10

What is a Balanced Scorecard?

A Balanced Scorecard (BSC) is a strategic planning and management system that shows the organization performance against its strategic goals.

These goals are organize in four different perspectives: Financial, Clients, Internal process, “Learning and growth”. These indicators should be linked to communicate a small number of broad strategic themes, such as the company's growth, risk reduction and increased productivity.

This methodology was created by Robert Kaplan e David Norton, in 1992, Professors at Harvard Business School (HBS).

IBM Metrics Studio supports the creation of Balanced Scorecards project with metrics and strategies. This way the company can verify if its goals are being met.

IBM Cognos Metrics Studio

IBM Cognos Metric Studio is used to create a Scorecard application and monitor the metrics within the applications. A metric is a key performance indicator (KPI) related to time. A Scorecard graphically shows how a metric is performing. This is typically done by using red, orange and green status notations.

How to Create a Balanced Scorecard

In the tab Scorecards we have the option to a “new Scorecard” by clicking the icon highlighted below:

The previous action will take us to a new screen:

This screen has important features like:

  • Specify the name of the Scorecard, select the language (this will affect the names and descriptions);
  • Write a description or technical description;
  • Select the Owner of the Scorecard. This is important part of the process due to the future management of the Scorecard permissions and data in the future;
  • Default grouping. Shows the strategy that the Scorecard belongs;
  • And to write the identification Code, because each Scorecard has the unique identification code. If you don’t put any code this be automatic.

Metric Type

The Scorecard, among the different structures, has two important concepts: the metrics and metrics types. It’s mandatory that you create a metric type before the creation of a new metric. This means that any metric needs to be linked to a metric type, and one metric type can have more that one metric.

The Metric Type can be created in the tab “Metric Types” by selecting the “New Metric Type” option.

This redirect us to a new screen which has many different options, like:

  • Name: Metric Type Name;
  • Owner of the Metric;
  • Identification Code: the Metric Type has a unique identification Code;
  • Calendar details:
    • Business calendar level and Business calendar level for most recent values view: The developer can define the granularity of the metric Type for example to month, quarter or year. This will define the periodicity of the introduction of data.
  • Number Format:
    •  Unit of measurement for metrics of this type, can be:
      • Currency;
      • Geral;
      • Percent.
    • Unit Symbol: to choose the unit symbol;
    • Decimal Places: Number of decimal places to display for metrics of this type
    • Status Indicator: Specify the status indicator settings for metrics of this type;
  • Performance pattern:
    • Specify the performance pattern to use when calculating score and status indicators for this metric type. It can be:
      • Above target is positive, this means the indicator turns green if the actual value is above actual value;
      • Below target is positive, this means the indicator turns green if the actual value is below actual value;
      • On target is positive, this means the indicator turns green if the actual value is to close in actual value.

Strategies

In the BSC is important to define the business strategies.

Each strategy can have many strategic elements to achieve, and each BSC has a strategy associated.

The strategy is created in the tab “Strategies” and by clicking in “New Strategy”. The strategy has associated strategical elements, first the developer creates the main strategy and then the strategy elements.

Each strategy and element strategy has a unique code associated.

The BSC can be associated to one or more strategy elements. These can be defined in the tab “Scorecards and Metric Types” and it is important to select the “Descendants” option because the Scorecard can have many BSC associated.

The Final step the developer goes to the Scorecard and change the “Default Grouping” to the strategy name that it belongs.

Metrics

After creating the BSC, Metric Types and Strategies the developer can create the Metric or KPI.

The Metric is created in the ScoreCard by selecting “New Metric”. This Metric has important features like:

  • Choose a metric type;
  • Owner of the Metric;
  • Each Metric has a unique code identification.

After that we can add values in the Metric, in the first click on the metric name and the next step click on the Pencil, like:

After you we can add elements, with simple click in “Enter Values”.

The introduction of values are:

  • Actual: actual value;
  • Target: target to hit;
  • Tolerance: defines an interval unrelated to set target. It can be defined with absolute and perceptual

After all this, we now can see the metric in the scorecard. It appears with a status icon (left one) indicates the performance pattern, if it is positive or negative, and also a trend icon (right one) which show if the metric has grown or stalled:

In the Metric it is possible to create Impact Diagrams that show us the impact of metrics that have impact other metrics.

Files

We can create a project by files in Metrics Studio.

The best practices recommend the creation of a separate file for each metric’s element. This means that if the developer can create a Balanced Score Card by file, so he creates a unique file for Balanced Score Card, this applies to create the Metric Type, Strategies and diagrams.

Another best practice is the creation of unique codes for each BSC, Metric type and Strategies. It’s important that during the construction of the input files.

And finally the files can be imported on Metrics Studio in two Steps:

1st Step: “Tools” - “Metric Maintenance” - Import data from files into staging area;

2nd Step: “Tools” - “Metric Maintenance” - Import and transfer data from files into metric store.

Database

All elements of the Metrics Project are inserted in a Database. This means that when we create a Metric project we first need to have a database that will be used by the project. The database can be created in several different technologies. Once we have it implemented, we can create objects or import files, using the Metrics functionalities, and inserted them into the database.

Others

When the developer wants to eliminate a ScoreCard, or Metric Type or a Strategy he needs to be careful because when it selects the below option:

It can delete other elements that the developer was not expecting. For example, if he eliminates a ScoreCard and we have associated objects like a Metric Type or Strategy, this elements will also be deleted.

 

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      Ana Ventura
       Consultant
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