The purpose of visualization is insight, not pictures!
Updated: May 25
The first thing you have to understand is what a dashboard is. When I'm asked what a dashboard is, the perfect example, to me, is a car's control panel.
In business, they have the same function because in a company there are so many events that impact in business performance and a dashboard summarizes these important events in an easy-way-to-understand format, and on real-time data visuals.
Do you remember when the car dashboard had no warnings? When people had problems with cars, they didn't know why or where. Nowadays, our cars have many warnings that alert us to situations like changing oil, adding gas, putting water, etc.
And you need to be able to quickly detect what is happening with your car while driving. If you need more gas? If you have an open door? Right?
What interests me, to know how much water I have in the car, if I have to calculate how much have concerning what should have?
Have you ever thought about having to check the oil level all the time, if there was no red light warning that is time to change? Or worst, have you ever thought if the engine was in trouble, and there was no red light warning that it is to stop immediately?
You will take more time calculating the current state instead of taking time thinking how to change or improve the situation. And worst, you may not be able to act on time and cause greater damage.
With just an image or a red light, while driving, we can detect if something is wrong. Now, can you see the value behind the images available on a dashboard? I think yes. In business, dashboard do the same thing, in a simplifies view of data in manageable chunks of visual information, they help people to act faster, and gives managers the ability to access information that they need, at any time or place, about company performance. Providing warnings about things (indicators) that managers are not even looking at that moment but that are going wrong.
Companies spend a lot of time collecting data and sometimes they don't know what to do with that. Other times the data only serves to calculate the final state without also monitoring the whole process.
Dave Lavinsky In Forbes, describe 5 Key Benefits of Dashboards:
1. Visibility When you have a good dashboard in your hands you know exactly what’s going on in all aspects of your business.
2. Ongoing Improvements The dashboards can monitor all the KPI’s that the managers consider relevant to their management, and thus support them for better management.
3. Time Savings If there is information that a manager prioritizes and access daily or monthly, why make him calculate, whether this information is within the state he wants? Dashboards provide this information quickly without the manager having to waste so much time to obtain it.
4. Judge Performance Against Your Plan Most of the managers, and like it should be, spend much time setting goals for the management of the company. However, they don’t always know if the remaining employees are fulfilling it. With a dashboard, the manager can monitor all the different elements or business areas and understand if they are complying with the defined plan, or even change the strategy initially defined, or realizing that the defined strategy is not having the desired results.
5. Employee Performance Improvements When employees know that their performance is being evaluated and compared to other elements, they intuitively improve their performance.
In summary, dashboards aren't pictures but insights that can help a manager using his time to improve the company's performance and even support him more effectively in his decisions. But, you need to be careful with the dashboards and mainly with the quality and type of data you have there.
But this will provide a topic for future conversations.
by Daniela Teixeira Business Intelligence Consultant @Passio Consulting