Dashboard provides at-a-glance views of key performance indicators

Key performance indicators

A performance indicator or key performance indicator is an industry jargon for a type of performance measurement.. KPIs are commonly used by an organization to evaluate its success or the success of a particular activity in which it is engaged...

 (KPIs) relevant to a particular objective or business process (e.g. sales

Sales

A sale is the act of selling a product or service in return for money or other compensation. It is an act of completion of a commercial activity....

, marketing

Marketing

Marketing is the process used to determine what products or services may be of interest to customers, and the strategy to use in sales, communications and business development. It generates the strategy that underlies sales techniques, business communication, and business developments...

, human resources

Human resources

Human resources is a term used to describe the individuals who make up the workforce of an organization, although it is also applied in labor economics to, for example, business sectors or even whole nations...

, or production

Production (economics)

In economics, production is the act of creating 'use' value or 'utility' that can satisfy a want or need. The act may or may not include factors of production other than labor...

) . The term dashboard originates from the automobile

Automobile

An automobile, autocar, motor car or car is a wheeled motor vehicle used for transporting passengers, which also carries its own engine or motor...

 dashboard

Dashboard

A dashboard is a control panel placed in front of the driver of an automobile, housing instrumentation and controls for operation of the vehicle....

 where drivers can monitor the major functions at a glance for example, how fast you're going, how much fuel you have remaining and whether the engine is overheating. Dashboards take the guesswork out of your decision making. Also, dashboards give signs about your business letting you know something is wrong or something is right. The corporate world has tried for years to come up with a solution that would tell them if their business needed maintenance or if the temperature of their business was running above normal. Dashboards do not need to provide every piece of information and typically limited to show summaries, key trends

Trend estimation

Trend estimation is a statistical technique to aid interpretation of data. When a series of measurements of a process are treated as a time series, trend estimation can be used to make and justify statements about tendencies in the data...

, comparisons, and exceptions. Well designed business dashboards can provide a unique and powerful means to present and monitor business information. There are 5 Key elements to a good dashboard: .
1. Simple, communicates easily
2. Minimum distractions…it could cause confusion
3. Supports organize business with meaning and useful data
4. Applies human visual perception to visual presentation of information
5. Comforting to the eye

Reasoning

Before the internet, specific information wasn’t needed ‘on the spot’ like it is today. Business executives only needed to call a department head, a financial executive, or the CFO of the company to ask for specific information and wait to receive it in the next week or so. Needless to say, the information most likely had change by then and the figures were no longer current.

History

Early predecessors of the modern business dashboard were first developed in the 1980s in the form of Executive Information Systems (EISs). Due to problems primarily with data refreshing and handling, it was soon realized that the approach wasn’t practical as information was often incomplete, unreliable, and spread across too many disparate sources . Thus, EISs hibernated until the 1990s when the information age quickened pace and data warehousing, and online analytical processing (OLAP) allowed dashboards to function adequately. Despite the availability of enabling technologies, the rapid rise in dashboard use didn't become popular until later in that decade, primarily due to the rise of key performance indicators

Key performance indicators

A performance indicator or key performance indicator is an industry jargon for a type of performance measurement.. KPIs are commonly used by an organization to evaluate its success or the success of a particular activity in which it is engaged...

 (KPIs), introduced by Robert S. Kaplan and David P. Norton as the Balanced Scorecard

Balanced scorecard

The Balanced Scorecard is a strategic performance management tool - a semi-standard structured report, supported by proven design methods and automation tools, that can be used by managers to keep track of the execution of activities by the staff within their control and to monitor the...

 . Today, the use of dashboards forms an important part of Business Performance Management

Business performance management

Business performance management is a set of management and analytic processes that enable the management of an organization's performance to achieve one or more pre-selected goals...

 (BPM).

Classification

Dashboards can be broken down according to role and are either strategic, analytical, operational, or informational . Strategic dashboards support managers at any level in an organization, and provide the quick overview that decision makers need to monitor the health and opportunities of the business. Dashboards of this type focus on high level measures of performance, and forecasts. Strategic dashboards benefit from static snapshots of data (daily, weekly, monthly, and quarterly) that are not constantly changing from one moment to the next. Dashboards for analytical purposes often include more context, comparisons, and history, along with subtler performance evaluators. Analytical dashboards typically support interactions with the data, such as drilling down into the underlying details. Dashboards for monitoring operations are often designed differently from those that support strategic decision making or data analysis and often require monitoring of activities and events that are constantly changing and might require attention and response at a moment's notice.

Dashboards and scoreboards

Balanced Scoreboards and Dashboards have been linked together as if they were interchangeable. As if they were one and the same. However, this is not true. Both have become increasingly popular due to their ability to visually display critical information. The difference is in the format in which their information is presented. Scoreboards can open the quality of an operation while dashboards provide calculated direction.
A balanced scoreboard has what they called a “prescriptive” format. It should always contain these components (Active Strategy)…
• Perspectives – groupings of high level strategic areas
• Objectives – verb-noun phrases pulled from a strategy plan
• Measures – also called Metric or Key Performance Indicators (KPIs)
• Spotlight Indicators – red, yellow, or green symbols that provide an at-a-glance view of a measure’s performance
Each of these sections ensures that a Balanced Scorecard is essentially connected to the businesses critical strategic needs.
The design of a dashboard is more loosely defined. Dashboards are usually a series of graphics, charts, gauges and other visual indicators that can be monitored and interpreted. Even when there is a strategic link, on a dashboard, it may not be noticed as such since objectives are not normally present on dashboards. However, dashboards can be customized to link their graphs and charts to strategic objectives.

Commercial dashboards

Dashboards have been part of large-scale applications and with the rise of on demand software services that provide affordable complex applications for small to medium businesses the appearance of dashboards is now quite common. Many companies are offering products designed to give businesses an accurate snapshot of their operations. While each provider provides its own set of features, there are qualities to which all aspire—such as simplicity.

Design

Dashboards are unique. The design of each dashboard is driven by the business and their needs and culture. What may work for one business may not work for another. There are general guidelines that are available when initially developing the tool or when looking to improve current performance metrics. In either of these cases, no matter what type of dashboard you wish to develop, you must…

• Identify your requirements
• Supply end-users with details
• Provide information in a timely manner

Planning and researching a good design is crucial for dashboards. A good information design will clearly communicate key information to users and makes supporting information easily accessible. Setting up your business dashboard can also be fun and worthwhile if you take heed to the 7 dos and don’ts

Do...

• Have only a few metrics to begin with
• Use basic tools you already have
• Use effortless line charts
• Include Pareto charts
• Let form follow fashion
• Use your dashboard at least weekly
• It’s okay to get someone to help you

Don't...

• Don’t wait until you have all your business issues taken care of to get a dashboard
• Don’t buy flamboyant software before you know what you want from a dashboard
• Don’t compare previous month with current month
• Don’t use pie charts
• Don’t use a lot of colors
• Don’t stop regularly tracking, testing or fine tuning your business
• Don’t go nuts trying to do it alone