BI dashboards must dish up killer KPIs

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BI dashboards must dish up killer KPIs

In today's lightning-paced business world, executives frequently demand up-to-the-minute information on organisational performance. If issues emerge, they want to take corrective action, rather than have problems fester. 

For the past two decades, business intelligence (BI) dashboards have been regarded as the key to navigating this fast-changing environment adeptly.

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But how do firms ensure their dashboards are presenting them with the most important information?

Given that much of today's business-critical data will likely be found somewhere within the enterprise resource planning (ERP) system, doesn't it make most sense to just pick the BI scorecard and dashboarding tools made by whoever makes your business applications?

Certainly, the big ERP players have in recent years spent billions hoovering up independent business intelligence suppliers, so there is a strong chance that your firm's ERP supplier will have dashboard technology that is up to scratch.

BI dashboards beyond ERP functionality

But picking the right dashboard for your business is about more than just finding technology that fits the bill, said Madan Sheina, lead analyst in Ovum's information management software group. 

“For a dashboard to be really useful, it has to display maybe six to eight items that are pertinent to an individual's role,” he says. “And that means drawing information from all sorts of sources, not just ERP.”

There are other good reasons for not getting dashboards from full-stack suppliers such as IBM, Oracle, Microsoft and SAP, said Boris Evelson, an analyst with Forrester Research. While there is no question that the big four have skewered the best-of-breed versus packaged application debate by providing state-of-the-art BI tools, not everyone wants to increase their dependency on single suppliers. 

Some firms also want flexible and highly visual BI tools, so might choose ones from the likes of Tableau Software, QlikTech or TibcoSpotfire.

“If your other IT initiatives are taking you in the direction of open source software, put Actuate’s Eclipse BIRT, Jaspersoft, Pentaho, and SpagoBI on your list,” said Evelson.

For organisations to gain a competitive edge from their dashboards, they need to understand who will be using them and what sort of data sources are needed. Some firms are taking the relentless flood of messages on Twitter to heart: those in the marketing department might reasonably expect their dashboard to be the canary in the micro-blogging mineshaft.

Nevertheless, whichever supplier technology firms choose to provide their dashboards, there remain some fundamental questions over how that can be harnessed to deliver business value.

At its most simplistic, populating an enterprise dashboard is supposed to a cinch – identify key performance indicators, work out where the data resides, integrate that information and, hey presto, a role-specific window on what's going on. Spot a problem? Simply drill down through the dashboard, and identify what's gone wrong and where, and make an informed improvement.

But while the theory sounds simple, the devil is, of course, in the detail. How should firms identify which KPIs are being measured and displayed?

One of the big criticisms leveled at dashboards is that too often those businesses building them confuse key performance indicators with metrics. So while the users may get near real time updates on revenues, sales or first-call resolution figures, they don't get an insight into business goals.

Dashboards are supposed to encourage their users to take actions that will help improve business performance. For a first-call resolution statistic to be useful, the user may need to know what the target should be and have the ability to drill down from their dashboard to understand the causes of any variance to that target – and then be guided towards actions that will address the problem.

In the first-call resolution example, the call centre manager may have a KPI achieving 95% customer satisfaction. The number of customer problems that are resolved in one call may be one of the metrics that feed into their dashboard view on that satisfaction, and from there the manager should be able to delve in to any issues that arise on call resolution.

The trick to defining the KPIs that should populate a dashboard is typically solved through the use of scorecards. These help business leaders crystallise their goals and break them down into a series of objectives that will help meet those goals and, furthermore, into the metrics they need to survey to analyse performance against those objectives.

"A good dashboard empowers employees to take actions," said Ovum's Sheina. So how do you know if your dashboard is a good one? 

“Staff use the ones that are good,” he said. If employees are still working off spreadsheets, it might be time to go back to the drawing board.


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This was first published in September 2012

 

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