The hierarchical classification of indicators is viewed using a tree-like layout, in the same way as folders and files are seen through a file system explorer. Each group can be expanded or collapsed to modify the visibility of the different levels.
The following types of elements must be defined in such a tree:
- Root Element
- Groups
- Indicators
- Data Sources
Every hierarchy of indicators has a root element that identifies the scorecard (it is the first element in the hierarchy). This element must always exist and is predefined in the definition of each new scorecard. The person defining the scorecard must add all the other elements in the hierarchy below the root element.
Groups let you classify the different indicators according to company areas, or in the case of implementing the Balanced Scorecard methodology, groups let you define perspectives and strategic objectives. In the end, these groups contain one or several indicators through which the corresponding measurements are made.
The elements in the lowest levels in the hierarchy in the definition tree correspond to the data sources providing the real values based on which the status of indicators is calculated.