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Customer Perspective

By Stephen Lipka  |  Posted 11-06-2009 Print

Customer Perspective

The second perspective for profit-making organizations in the balanced scorecard approach is customer benefits. The kind of metrics you'll find here are concerned with services you brought to your business partners, users, end customers, distributors, etc., measured by their success metrics or their satisfaction levels. Examples include:

• Increased satisfaction with the features in your applications.

• Increased satisfaction with response time

• Increased satisfaction with technical support

• Increased sales or retention of customers arising from any of the above

• Increased barriers to distributor or customer departure because of their increased dependence on your technology

• Reduced time to execute a business process

Note the similarity between this last point and process cost reduction above in the financial perspective. Process cost reduction, as the phrase suggests, measures cost. Reducing time to execute business processes, however, is more closely tied to your business partner's process metrics.

This highlights the relationship between financial perspective and customer perspective objectives, metrics, and achievements. Customer perspective objectives are second-tier; they should be designed to contribute to financial (first-tier) objectives and achievements--IT's or the company's. There may not be a direct tie, because we all understand that sometimes there's a long-term indirect effect that just can't be quantified in dollars and cents.

What you did for your company--in this category--has indirect effects on the company's performance. These achievements are appreciated by anyone affected by your services, but because there's not always a tie to money and because your accomplishments aren't expressed in financial terms, you can likely guess which audience might not perceive your achievements as contributions to the company:

However--and this is a critical point--these are leading indicators, unlike the financial tier achievements. If you succeed in these areas, you are likely to see improvements in your financial achievements or the company's financial achievements. If you fail to achieve anything in this category, your achievements in the top tier probably won't be so good in the next reporting period. Consider: If your users aren't happy because that new release was flawed, don't expect your support costs to drop.


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