Executive dashboard is like instrumentation panel of your business, where various gauges indicate the health of the business in terms of parameters which are critical for success of business strategy. A real time executive dashboard is the culmination of well planned business process integration across the company. The data captured through bread and butter processes of the company is analysed and information in meaningful terms is extracted at various levels in the company. In other words the operational data in a company is transformed into strategic information through analysis against important business criteria and presented in terms of a few strategic measures, which the top management should typically concentrate and base its decisions on.
Business knowledge – the key factor
The first step in designing a dashboard is accurate identification of critical success factors for an organization and measures of performance (also known as Key Performance Indicators – KPIs) that drive the achievement of desired results. An organization should realize that KPIs of companies competing in the same industry may not be similar and generally they are not. KPIs typically depend on the growth objectives of the company and strategy that it adopts to achieve the growth. Even for competitors who are pursuing similar strategy the KPIs may differ depending upon its inherent strengths and weaknesses, its competitive advantages and resource availability, and crucial bottlenecks that it faces along its value chain.
The first step in designing a dashboard is accurate identification of critical success factors for an organization and measures of performance (also known as Key Performance Indicators – KPIs) that drive the achievement of desired results. An organization should realize that KPIs of companies competing in the same industry may not be similar and generally they are not. KPIs typically depend on the growth objectives of the company and strategy that it adopts to achieve the growth. Even for competitors who are pursuing similar strategy the KPIs may differ depending upon its inherent strengths and weaknesses, its competitive advantages and resource availability, and crucial bottlenecks that it faces along its value chain.
Strong support of top management team is very crucial as design of appropriate KPIs to measure a company’s strategy means agreement on measures by all concerned. Especially so, because the measurements may have to be derived through performance data of key business processes that typically cross functional boundaries. For example a measure like average time taken to introduce a new product may depend upon the performance data of various functions like Design, Manufacturing and Marketing.
Ultimate visual communication tool
One feature that is seen as part of all business performance management tools is that the executive dashboards are represented by graphics that communicate the visual message very strongly and effectively – like measurements such as share of customers total purchase can be shown through pie charts, saturation of market segments can be shown through stacked column or bar charts, financial growth can be shown as line plots, compared with projected figures and measures pertaining to operational efficiency (such as energy efficiency, capacity utilization etc.) can be depicted suitably as a dial type gauge. By the purpose that they serve and by the look that they are designed to have the executive dashboards truly resemble the instrument desk or the cockpit dashboard – incidentally the name this tool for business performance management derives is from the cockpit dashboard which not only enables pilots to monitor the flight but also manoeuvre it. This is the exact purpose that an executive dashboard serves for a business. It enables executives at the top to make strategically important decisions based on the predictive insights provided by KPIs.
One feature that is seen as part of all business performance management tools is that the executive dashboards are represented by graphics that communicate the visual message very strongly and effectively – like measurements such as share of customers total purchase can be shown through pie charts, saturation of market segments can be shown through stacked column or bar charts, financial growth can be shown as line plots, compared with projected figures and measures pertaining to operational efficiency (such as energy efficiency, capacity utilization etc.) can be depicted suitably as a dial type gauge. By the purpose that they serve and by the look that they are designed to have the executive dashboards truly resemble the instrument desk or the cockpit dashboard – incidentally the name this tool for business performance management derives is from the cockpit dashboard which not only enables pilots to monitor the flight but also manoeuvre it. This is the exact purpose that an executive dashboard serves for a business. It enables executives at the top to make strategically important decisions based on the predictive insights provided by KPIs.
This concept has been commercialized by software vendors by designing dashboards for executives at different levels to monitor KPIs relevant for the business. Dashboards are supported by underlying information management infrastructure by gathering relevant data and integrating applications at different levels in the organization. KPIs are presented in a manner that gives executives enhanced analytical insights. Executive dashboards not only show the current levels of performance against each KPI, but in fact have processing power required to create “what-if” scenarios and exception reports which are of immense help in giving vital information to executives to initiate necessary corrective actions.
In short critical to the success of any dashboard project in an organization are top management support, identification of right and actionable factors to measure the company’s strategy and seamless integration with underlying applications and processes.
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