The concepts of dashboards, KPIs and analytics can get blurred. They are related but distinct from one another. The following analogy might help keep things straight. When you’re driving, you have a dashboard that communicates various pieces of data about your trip. Your Key Performance Indicators (KPIs) might include things like your speed, miles-per-gallon and so forth. Analytics is more the “thinking” part of the drive, such as the “miles remaining in the tank” display that is now available in most cars. That figure comes from the car’s electronics looking at your speed and gas tank level and offering an analysis regarding how much farther you can go at that rate.
The data visualization dashboards we use in business are comparable. They offer a display of data about our business. We can track KPIs through the dashboards. The dashboard can also visualize data analytics. Each data visualization on the dashboard surfaces as a “widget,” a graphical element that contains a chart or graph of some kind, e.g. a pie chart. Data from underlying systems like Enterprise Resource Planning (ERP) feed into the widgets.
Role based dashboards
Not everyone needs to see the same dashboard in a business. Indeed, not everyone should be able to see the same dashboard. What senior managers see may be confidential, for example. The role-based dashboard lets users in a particular role see the data visualizations they need to get their jobs done. A HR person, for instance, might use a dashboard with visualizations about unfilled job openings. A customer service manager’s dashboard could show wait times for customer service phone lines and so forth.
Dashboards can also be configured on a departmental basis. Rather than defining the display by user role, it makes data visualizations available for everyone in a particular department. With accounting, the dashboard’s KPIs could align with departmental objectives like the current ratio. If the target current ratio is 1:1, the dashboard could indicate a deviation from that goal with a color-coded signal like a red light. This alerts department employees that they’re falling short of their current ratio goal.
KPIs and analytics for finance
Financial managers can make use of dashboards that leverage advanced analytics capabilities. For example, a financial dashboard could incorporate data from external sources to aid in financial planning, e.g. showing how interest rates on the company’s portfolio of loans compares to market rates. A financial dashboard could also visualize predictive calculations such as estimating cash flow shortfalls and revealing projected borrowing costs. The dashboard’s visualization capabilities allow financial managers to see trends that might be hard to articulate in purely numerical form.
Learn more in Getting Proactive With Data Analytics.
Dashboards for operations
Operational dashboards help managers see how a business is running, in practical terms. It can display visualizations of KPIs like orders shipped on time or overtime paid versus product produced. As is the case with finance, a dashboard in operations provides users with visualizations of trends that can be difficult to detect.
Setting up role-based and departmental dashboards is getting simpler with advances in Business Intelligence (BI) tools. The process does require some time and expertise, however. Determining the KPIs, for instance, can be challenging.