After 20+ years in finance and partnering with business leaders to help improve business results I think I have a pretty good perspective on using metrics and dashboards to drive the business.
Everyone seems to have a dashboard. Smart people whip out their dashboard to show you how great they are. Doesn't it make you sick!!
They try and show you what's working well and many times gloss over the ahem- terrible metrics.
Here are my top ten learnings.
1. Less is more.
Too many metrics and you get confused. Dig deep to figure out what's really important vs. a nice to know.
2. If the metrics are not tied to your MBO process, performance evaluation and incentives then who cares?
3. Do you have an exec/company dashboard ( a summary of the functional metrics) and also functional dashboard for Sales, HR, Finance, Marketing, Tech and Product? Maybe sales is missing it’s quota due to the many open reqs for sales reps?
4. Are the metrics well understood (defined) by all or are they just relevant to one function? Too many metrics on finance means you talk all day long about a P&L or balance sheet vs. customer satisfaction or employee attrition.
5. What happens when there's a bad week for your company dashboard?
If nothing then you should stop distributing that dashboard. Add it to the things you've done to save time. No response means they don’t matter. Re-think your metrics and start over.
6. Does the CEO or other exec call you when your dashboard is late?
If not then you are in trouble- you may have irrelevant metrics OR even worse nobody is accountable for the metrics and they are not tied to incentives so no one cares.
7. Does it take half the week to produce your dashboard?
If so you may be spending too much time in production and not enough trying to get more insights. Get IT to help develop some automation and do not give up until most of the dashboards are automated.
A note of caution: when starting out don’t go for automated dashboards as you may have the wrong metrics. Just capture them in excel and get them out so you can have meaningful discussions.
8. Does your dashboard come with some red-yellow-green call-outs? These point the reader to the trouble spots. Execs are just over-whelmed with information, do not have much time and want to get to the problems fast.
9. Does the monthly operating meeting or board meetings start with the company dashboards? If not then you have the wrong dashboard and metrics.
10. Ask a different exec to present the monthly company dashboard each month. That way they will make sure they will understand the metrics and more importantly give feedback fast if you are measuring the wrong things!
Dashboards are a great way to see at a glance what’s going well and not so well. Used properly they are a wonderful business tool that improve execution, enhance communication and help businesses achieve their potential.