Bernard Marr is a world-renowned futurist, influencer and thought leader in the fields of business and technology, with a passion for using technology for the good of humanity. He is a best-selling author of 20 books, writes a regular column for Forbes and advises and coaches many of the world’s best-known organisations. He has over 2 million social media followers, 1 million newsletter subscribers and was ranked by LinkedIn as one of the top 5 business influencers in the world and the No 1 influencer in the UK.
Bernard’s latest book is ‘Business Trends in Practice: The 25+ Trends That Are Redefining Organisations’
How do you create the best KPI dashboard for your business?
2 July 2021
Don’t forget the most important step in developing KPIs—a KPI dashboard that communicates effectively and translates important insights to decision-makers.
Here we compare an effective KPI dashboard with curating a fine dining experience. Learn what you need to know to create the best KPI dashboard for your business.
The reality is that your effort developing the right key performance indicators (KPIs) and gathering data to measure those KPIs is lost if you don’t do one thing—communicate those insights in a meaningful way to decision-makers. You need the right people to get the information they need if you want to use KPIs effectively in your organization.
That’s why I want you to think about your KPI dashboard like a fine dining experience instead of a buffet.
What are Key Performance Indicators?
Key performance indicators (KPIs) provide a way to measure the performance of individuals, departments, projects or companies regarding progress to achieving objectives. While the term is often familiar to those in business, most don’t know how to use these vital navigation instruments properly. However, if they did, KPIs can really help companies succeed.
Much time and effort are spent by companies to define KPIs and then gather data to track them. Where many organizations drop the ball is to effectively communicate the insights subject matter experts glean from the KPIs to executives who can use those insights to make critical decisions. While they might report data to executives, they don’t do it in a way that helps executives understand the essential message.
Unfortunately, when this is the reality, tragedies and negative business outcomes—that could have been avoided—can occur as was the case when NASA’s space shuttle Challenger exploded after launch. When NASA was developing the Challenger, some of the engineers had identified a serious concern with the possible failure of the O-ring component. While this data was communicated to decision-makers, the reports shared with them didn’t make it abundantly clear the engineers believed the O-rings could fail. Therefore, the launch continued as scheduled and the result was catastrophic.
How do you make sure decision-makers are clear about the action the KPIs indicate should be taken?
It’s time to curate your KPI dashboard like a fine dining experience.
Effective KPI Dashboards Curate Insights for Decision-Makers
Do your KPI dashboards detail data but forgo reporting actual insights? The result is that the meaning of the data is lost because there is no meaningful translation. If there is no understanding of the data, action will not be taken.
To avoid this and allow KPIs to help decision-makers gauge and monitor how well the company is delivering on strategic goals, we need to declutter our KPI dashboards.
Too often, companies allow their execs to self-serve at the KPI buffet and give them all the data to sort through. This fails to drive company performance because the information is lost in translation. Also, the execs might not have the subject matter expertise to truly discern what the data is telling them.
When you sit down at a fine dining establishment, your entire experience is carefully curated. Much thought and effort have gone into what ingredients, entrees and sides are presented to you and how they are arranged on your plate.
Now, apply this thinking to your KPI dashboard.
What are the biggest strategic goals of your organization? Be sure to present those questions at the top of your KPI dashboard.
Then, what data do you need to give the executives so they can understand how they are doing against this question or strategic goal?
It is not necessary to provide all the data that has been gathered. You want to hone the decision-makers’ attention on the data that matters—what will help them understand how they are progressing toward their strategic objective.
If you present every option—a buffet of data—and executives can pick and choose what they want to focus on, it is much more likely they will miss the key message.
Effective KPI dashboards offer a visual display of the most important information. How can you best use words, numbers and visuals such as pie charts and bar graphs to help the message jump out to those that need to understand?
Remember: KPIs are only effective decision-making tools if they help to answer the most critical business questions. If there is confusion or clutter, chances are that KPIs won’t do their job even if your organization spent significant time and resources developing what KPIs should be tracked. Those organizations that meticulously curate KPI dashboards—like a fine dining chef curates a dining experience—have the power to make decision-makers understand the data to then act.
Where to go from here
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