For the same reason that car companies build cars with fuel gauges and speedometers, companies deploy dashboards to give their employees an easy-to-understand view of the numbers that matter most, so they can make decisions to keep their businesses running smoothly and at peak performance.
In the automotive industry, dashboarding has always been a simple and necessary component: low fuel = buy fuel; high speed = slow down or get speeding ticket. In business, however, dashboards have repeatedly fallen in and out of favor, their successes and failures attributable to immature technologies and uncertainties about the goals they were meant to achieve.
Recently, a shift in customer demand for greater information access and insight, along with advancements in dashboard performance and reliability created a new opportunity for dashboard technology to help customers unlock the value of their information.
There are three general categories of dashboards operational, tactical and strategic.
- Operational dashboards track core operational processes and often display real-time data. These dashboards emphasize monitoring more than analysis or management.
- Tactical dashboards track departmental processes and projects and emphasize analysis more than monitoring or management. They are often implemented using portals and run against data marts or data warehouses.
- Strategic dashboards (or scorecards) monitor the execution of corporate strategic objectives at each level of the organization and emphasize management more than monitoring or analysis. They are often implemented to support a balanced scorecard methodology.
Companies build each dashboard on a single data infrastructure and application platform to deliver consistent information to every user, but multiple versions of each type of dashboard should be deployed to account for various user needs.
Operational Dashboards: Focus on Monitoring
Operational dashboards enable front-line workers and supervisors to track core operational processes (see Figure 1). Monitoring is their key capability. These dashboards provide operational managers and staff immediate visibility into key performance indicator (KPI) performance, permitting quick decisions or immediate corrective action, and also generating alerts to notify users of exception conditions in the processes being monitored.
Operational dashboards can be delivered as a hardware appliance or through the software as a service (SaaS) model to provide continuous monitoring for business operations. They enable operations managers and/or teams to proactively respond to continually changing business conditions or processes with streaming technology that ensures continually up-to-date metrics.
Business users can build, modify and personalize dashboards to most effectively present the information they need without IT intervention. Charts and graphs can be customized, thresholds and alerts can be set, and new dashboards can be created using a simple point-and-click interface. Finally, Flash-based components provide rich visualization and interactivity.
With an operational dashboard, IT can provide users with unlimited access dashboards and data sources for a low total cost of ownership and minimal IT effort and resources. Role-based, data-level security ensures that users see only the data thats relevant to their tasks.
Tactical Dashboards: Emphasis on Analysis
Tactical dashboards help managers and analysts track and analyze departmental activities, processes and projects. Analysis is their key strength. They display at-a-glance results in a BI portal or professionally authored report format that contains charts and tables needed to monitor specific projects or processes. Users can drill down or through the data using multidimensional online application processing (OLAP) analysis and advanced reporting.
Tactical dashboards provide managers with daily, weekly or monthly performance updates. They are not updated as frequently as operational dashboards, nor do they need be; rather, they provide managers with access to the full complement of related performance management capabilities through interactive charts and tables.
With tactical dashboards, managers can drill into or through related reports and other data sources (for example, OLAP cubes), to explore and understand the trends and issues affecting performance at the operational level. If an operations team reports that quality is falling outside of an acceptable range, or if quarterly sales are higher than usual, managers can analyze the data to understand why. A key supplier may have missed its last few shipments to affect quality, for instance, or aggressive discounting could affect sales. In both cases, data from the operational dashboard feeds into the tactical dashboard, prompting a manager to explore a broader data set to make the needed adjustments.
With advances in mobile BI applications, managers can now also access tactical dashboards on their mobile devices, allowing access to the same reports managers would access through their browser. These dashboards can then be displayed in presentations.
Strategic Dashboards/Scorecards: Managing Strategy
Strategic dashboards/scorecards let executives and senior staff chart their progress against strategic objectives. A scorecard is a strategy management application that helps organizations measure and align the strategic and tactical aspects of their businesses, processes and individuals via goals and targets. Because of their role in executive decision-making, strategic dashboards and scorecards demand a more structured approach and framework than operational and tactical dashboards and, as such, often make use of a methodology such as the balanced scorecard, total quality management or Six Sigma.
A typical strategic dashboard (or scorecard) includes important metrics, each with an associated target, thresholds for good and poor performance and a clearly identified owner. A proper scorecard, however, must also provide more than red, green or yellow status indicators. To enable executives to manage strategy effectively, scorecards must reveal the relationships among and between each metric and the ways in which performance in one area (for example, R&D) affects outcomes in another (for example, sales). This is often done through a strategy map.
In addition, strategic dashboards must enable executives to drill into supporting details in related reports, or conduct multidimensional analysis to determine why a metric is performing a certain way. When executives change targets, forecasts or resource allocations, these changes must also be simultaneously reflected in the tactical and operational dashboards (as well as their related forecasts, HR and marketing plans, etc.) throughout the organization. In this way, dashboards perform a vital role in a performance management system.
High-performing organizations need information in an easy-to-understand, at-a-glance format that will improve their decision-making in a way that drives better performance. Increasingly, this format is the dashboard.Dashboards provide such critical information in a single display (often a single computer screen), often making them the front door to performance management initiatives.
Not all dashboards are created equal, however. Companies pursuing a dashboard strategy must ensure that each user receives information that is specific to their role and task, that enables them to drill down into results, and that refreshes according to the frequency of their decisions. Operational managers need information that moves as quickly as they receive orders from their Web site. Executives, on the other hand, may only need to see updated results monthly. Of utmost importance is that the data, metrics and thresholds are all integrated across the organization, share a common data source and are deployed within the context of a performance management strategy, with metrics, thresholds and targets all tied to commonly understood and shared business goals.
For example, if a manufacturer bases its competitive strategy on providing higher quality goods, the CEO can monitor overall quality as easily as can the plant managers and those on the assembly line or in the factory, with data feeding all three types of dashboards simultaneously, with each user seeing the data at the right level of granularity and refreshed at user-appropriate intervals.
The results of all this integration are simple: business users at every level receive precisely the information they need to make better decisions that improve business performance.
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