What is KPI Dashboard
About KPI Dashboards
The dashboard is a revolutionary business data reporting and management tool. Typically, they come full of important business metrics and key performance indicators (KPIs), which they track, analyze and provide visual feedback of, to be used in aligning the execution of one or a collection of business processes with the business strategies towards achieving laid out operational goals. In other words, the dashboard is efficient for keeping track of where the company stands as compared to targeted performance and ultimately for making informed decisions quickly.
Business dashboards are customizable in many different ways, but regardless of how complex they can get, they are usually made up of simple visual indicators, tables, line and bar charts, used to exhibit KPIs for real-time monitoring on the computer screen, or printed to a business report and a business scorecard.
What Are The Benefits Of KPI Dashboards?
When well organized and focused, a business analysis and reporting system such as the performance dashboards, offers users, business managers and analysts, many benefits. The following are some of the benefits to any organization regardless of size, location and industry:
KPIs are important tools that bring about organization-wide success. Here are some of the benefits of KPI software to manage Key performance indicators:
- Automation of Data Collection: Operational dashboards are fast becoming core business performance monitors for front-line workers and department managers. So-called because they enable users to choose a time to track operational data.
- Real-Time Monitoring: The dashboard allows monitoring of multiple key metrics and result indicators simultaneously, as they happen in any aspect of the business, be it at marketing, sales, finance, or support. Identifying operational issues or potential opportunities in real time will inarguably go a long way in averting damages or taking advantages thereof.
- Easy to Read: The performance dashboard presents metrics and KPIs as infographic tables, charts, and graphs, utilizing colors, symbols and other visualizations to clearly highlight important data points and give great insights at a glance.
- Cloud Accessibility: Dashboards can be used to put the business' data to the cloud, making KPI results accessible, anytime, anywhere, on the computer monitors, tablets or mobile phone. This keeps every member of the business on the same page. A common practice of the workplace, which is becoming increasingly popular, is to have a display of the business’ operational dashboard on TVs, to keep everyone abreast of the company’s performance and objectives at every point in time.
- Efficient Reporting: Dashboard reporting is a time saver. As compared to traditional analysis and reporting, rather than spending countless hours to track and collect data from multiple disconnected business systems for analysis, an operational dashboard can be automated for data collection and analysis to provide the information at a glance, whenever they are needed. Time-saving translates into productivity.
Setting up a KPI Dashboard
It is important to note that a KPI dashboard, rather than just being an online visual report, is setup to influence actionable business decisions and outcomes. That being said, they should only showcase ‘key performance indicators’; not every single metric or performance indicator that exists. For the dashboard to be friendly and without distractions to its observers, there are certain requisites that may need to be met.
Metrics to be tracked
Prioritizing performance results and metrics on the business dashboard is an important part in getting your dashboard project moving. Dashboards must be setup to closely align with the business goals and as a direct response to business needs.
Because of their versatility, the same dashboard software may be applicable to a whole range of companies and industries. Clearly, there are universal KPIs, which tend to be easy to interpret and applicable to various companies. Some of these are, Operating Costs, Revenue, and Gross Profit. Also, attention may need to be given to certain other KPIs known to directly or indirectly influence the universal KPIs.
Aside from providing an overall picture of the business’ performance, the dashboard also allows one to go into details at various levels. For instance, from the universal KPI, Revenue, Sales Revenue could be previewed, proceeding to specific Product Sales and then to the individual Product Cost of Sales. These related to time periods will be useful in deducing seasonal variation.
Things to avoid
With the performance dashboards becoming easier and faster to setup, one might be tempted to want to load up the dashboard with as much metrics are supported on the visualization software. It is even possible, to have different renderings of the same metric, cluttering up the dashboard with little room for other indicators. Just because an indicator is there, doesn't mean you must use it. Keeping in mind that the more precise you are about your KPIs, the better your chance at achieving your goals with the dashboard.
An efficient test to decide which metrics to display is to go through each item on the board and ask oneself:
- Do I need to see this every time I look at the board?
- Is this the best indicator to relay this information?
- Does this show me an outcome of different metrics put together?
- Does this repeat information that already could be inferred on the board?
The purpose of the business dashboard becomes facilitated when the metrics paraded are logically related. That way, an onlooker can quickly comprehend the business’ KPIs and then make up a holistic picture of the company as a whole.3. KPIs that do not communicate customers` interests
Try not to be selfish when setting up your business’ dashboard by focusing only on factors that matter to the business regardless of whether they directly or indirectly communicate the customers’ satisfaction and needs. Failing to align the company’s key metric performance with the customer service experience may not go down too well with using KPI dashboards to work smarter and increasing productivity.4. Wrong visual presentations
Aside from selecting the right KPI data, how they are presented also counts. The most commonly recommended way to track performance changes over time is with the line chart, because of all visual aids used in data analysis, they tend to be the quickest to grasp. Stringent attention must be paid to the selection of visualizations to convey business data distribution, as this can make a difference when it comes to having an efficient dashboard.
KPIs are best functional when they are drawn up as frequencies, that is, against ‘optimal’ time periods. For example, it would be unnecessary to display the number of unique visitors to the website hourly when there are often fluctuations, however, by collecting over a month, better patterns and comparisons can be drawn of the data, which can then be displayed.
It is not enough to have selected the best set of KPIs and know just which visual aids are best to relay them, one must also consider the optimal frequency that the data would be displayed on the dashboard.6. Leaving out employees
Part of the dashboard creation process should involve input and feedback from members across the company. Also, for it to be most useful, the dashboard should be available to everyone.
Don’t assume that they know better; be sure to enlighten your employees on the purpose of the dashboard, and why the setup visuals have been chosen.
Needless to say, employees that know that their performance is being watched and noted, tend to take the opportunity to continually act right and improve their work.7. Underestimating the power of visual design
Remember the dashboard is not for decoration. Providing a clear and user-friendly business dashboard is prerequisite to a logical and usable presentation of data.
Be judicious in your use of colors, fonts and the other design components. Keep the dashboard features simple, complementary and pleasing to the eyes.8. Information gaps
Yes, less is more, but sometimes less can be way too less. Just as metric overload, insufficiency or poor data is as damaging to the dashboard. Truth is; a dashboard that gives incomplete data will be perceived as an unreliable one.
Being very pragmatic with the setup process will very well pay off and remember, reliability truly sets apart a simple KPI dashboard as a critical business performance improvement tool.
Ultimately, you must understand that nothing is fixed and unchangeable. Things change, companies and businesses evolve and so should dashboards. A forgotten dashboard soon starts to be inaccurate, misleading, and irrelevant. Regular reviews, and pruning away of metrics/KPIs, charts, graphs, etc. that no longer are relevant, keeps the dashboards more productive.
Features of a business dashboard
Enough said, here are some of the features and considerations to a beautifully-setup and functional dashboard:
- Graph types: No doubt, real-time charts, and graphs are the most conventional and fundamental components of any performance dashboard. The dashboard technology usually comes with numerous kinds of visualization elements, not to mention the endless derivatives available. The onus, therefore, is on the operator to select graphs and charts that express data in the most understandable way, one such that the questions being asked of the chosen KPIs are sufficiently answered.
- Clear dashboard communication: Clarity or the ability of the dashboard to communicate business performance – whether good, bad or indifferent, is a vital feature of a high-performance dashboard. The key to removing confusion from the dashboard's communication is to choose KPIs and their visualizations based on the questions being asked of company's performance.
- Analytics: The ideal KPI Dashboard provides the platform for the user to display surface data in a way that is clear and meaningful, and with provisions for accessing subsequent data to drill-down to further detail on performance when required.
- Grouping: Related objects can often be organized to build upon each other in the dashboard. For example, a chart with surface data as monthly unique visitors can show, at the subsequent level, top five origins of the visitors to offer insight on visitor segmentation and for target marketing. Grouping of KPI will help users easily grasp how performance data relate to one another.
- Concision: It is not enough to have selected the truly relevant and insightful metrics to embody business performance on the dashboard; their representation also matters. The concise dashboard removes frustration and rewards the audience with quick and proper interrogation of metrics.
- Responsiveness: The ideal dashboard is quick to respond to changes in KPIs and give feedback to users.
- Exporting And Sharing Results: A dashboard with flexibility in the replication and communication of it messages (through mediums such as image file, PDF files or Excel) that can be effortlessly shared among individuals, teams, and groups; tend to enjoy more preference.