With the right implementation, nonprofits have a straightforward tool for measuring success at their fingertips.

By Joel Zimmerman

If you are up for the challenge, here are your basic steps:

1. Get your board of directors and managers educated on the basics and committed to the effort.
2. Appoint someone on staff to be in charge of creating and maintaining the balanced scorecard.
3. Depending on your organization’s size and the knowledge of the person you have placed in charge, you may need to hire a consultant to assist in this effort.
4. Build your scorecard categories to match what is in your strategic plan. Or build your strategic plan around the categories you will use for the scorecard. Or modify your existing strategic plan so it matches the scorecard categories.
5. Derive the balanced-scorecard measures, metrics and analytical techniques, and implement them in test mode for two or three months.
6. Use the test experience to improve the balanced-scorecard measures and processes.
7. Begin to collect, analyze, report and archive scorecard measures on a regular (e.g., monthly or quarterly) basis.