Advancing communications measurement and evaluation

A New Balanced Scorecard for Communications

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by Tim MarkleinToday’s marketers and communicators are awash in data, metrics, and research – and yet they frequently report they can’t measure the impact of communications efforts. Why the disconnect?

In many cases, it’s because they lack a measurement framework that unifies data from different channels, campaigns and disciplines. Most of the popular tools for measuring communications are limited to assessing a single channel, and many of the early frameworks offered up by measurement experts are biased toward a single marketing discipline or research methodology.

What’s needed is a cross-discipline, multi-channel approach to communications measurement that is easy to understand and use. One that helps an organization frame its metrics in meaningful terms – balancing short-term and long-term impact with a focus on organizational outcomes.

What makes the Balanced Scorecard so valuable is the integration of metrics across channels and disciplines into a unified framework.

To that end, we have spent the last 18 months developing and testing a “Balanced Scorecard” for measuring marketing and communications. The Balanced Scorecard is a popular approach to measuring and managing organizational performance that emerged in the late 1980s and early 1990s. The approach originated with a Silicon Valley company called Analog Devices and was later evangelized in a best-selling book by Harvard professor Robert S. Kaplan and consultant David Norton.

By the late 1990s, Fortune magazine found that 64 percent of companies were measuring organizational performance using approaches similar to the Balanced Scorecard. Why? Because it helps organizations translate strategic plans into the “marching orders” for the organization, unifying teams and individuals to achieve common goals that balance financial performance, operational efficiency, talent management, and customer/stakeholder satisfaction.

In just one slide, the Balanced Scorecard can help organizations better measure and manage their marketing and communications.

We believe the Balanced Scorecard can work equally well for today’s marketers and communicators, who have plenty of metrics and tools but are still limited by lack of insight, poorly defined goals, siloed research, and unclear impact.

What makes the Balanced Scorecard so valuable is the integration of metrics across channels and disciplines into a unified framework. This puts the metrics into organizational and functional context, while ensuring that teams have a top-of-mind focus on both process and outcomes. This balanced view not only helps improve measurement and performance of critical functions – it also plays an important role in strategic planning, team alignment, insight generation, and value creation.

So how does this work? First, we defined four quadrants that align and adapt the original Balanced Scorecard framework to reflect a logical grouping of marketing and communications goals. This wasn’t an easy exercise, and required plenty of debate, testing and refinement with multiple clients during the development phase. I’m sure we didn’t get everything perfect, and we look forward to additional input and expertise as we refine the approach.

Balanced-Scorecard-thumbUltimately, we landed on four quadrants that have become relatively “stable” in our test product. The quadrants reflect a mix of process and outcome measures (vertical axis) mapped against tangible and intangible measures (horizontal axis) as follows:

Reach & Engagement: These tangible process metrics demonstrate an organization’s reach and engagement with its audiences across channels, while evaluating internal and external communications efficiency. Data typically come from paid, earned, shared, and owned media tools and internal tracking systems.

Relevance & Alignment: These intangible process metrics demonstrate an organization’s internal alignment and external relevance, reflecting qualitative factors including audience understanding, market relevance, messaging consistency, and employee alignment. Data typically come from paid, earned, shared, and owned media tools and internal tracking systems.

Revenue & Financials: These tangible outcome metrics reflect financial and sales impact, including leads, lead value, revenue, profitability, market share, and other business data. Data typically come from company sales and finance teams and industry analysts.

Reputation & Brand: These intangible outcome metrics reflect longer-term stakeholder relationships, perceptions, reputation, brand advocacy, and brand equity, which may impact future revenues, brand premiums, and/or stock price. Data typically come from survey research, third-party reports, and internal tracking systems.

Within each quadrant, we recommend identifying 3-6 key performance indicators that reflect an organization’s marketing and communications work across channels, campaigns and disciplines. One single metric in each quadrant may be ideal, but we have found that it’s practically impossible to achieve. On the flip side, having more than six KPIs in a quadrant is too distracting – and usually means more work should be done to aggregate metrics or unify across disciplines.

Here are a few sample metrics that can fit into each quadrant:

  • Reach & Engagement: Total Reach (PESO); Total Engagement (PESO); Reach Efficiency (CPM); Site Visitors; Social Audience; Earned Reach; Paid Reach & Frequency; News Share; Social Share; Influencer Interactions
  • Relevance & Alignment: News & Social Sentiment; Online Opinions; Message Consistency; Message Pull-Through; Topic Share; Audience Understanding; Employee Alignment
  • Revenue & Financials: Revenue; Profit; Market Share; Donations; Leads; Lead Value; Average Deal Value; Sales Velocity; Return on Investment
  • Reputation & Brand: Brand Awareness; Brand Advocacy (WOM); Brand Equity; Customer Acquisition; Customer Retention; Customer Satisfaction; NetPromoter Score (NPS); Partner Satisfaction; Employee Engagement; Industry Award Wins

Many metrics above are already tracked by many organizations. Plugging them into the Balanced Scorecard enlivens them with organizational context and workflow – blending tangible and intangible, process and outcomes, short-term and long-term. In just one slide, the Balanced Scorecard can thus help organizations better measure and manage their marketing and communications – while unifying strategy, aligning teams, optimizing programs, and enabling more holistic decisions.

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Tim presented a version of this article at the recent IPR Measurement Summit in Durham, New Hampshire.

Tim Marklein

Tim Marklein

Tim Marklein is the founder and CEO of Big Valley Marketing, a data-driven consultancy that helps technology companies improve their marketing and communications. Tim has 20+ years experience helping clients launch businesses, create market categories, build reputations, win proxy fights, and grow revenues. Tim actively contributes to industry standards and best practices, and serves as a member of the Institute for PR Measurement Commission and the Social Media Measurement Standards Conclave.
Tim Marklein
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