Advancements in CPM technology and software solutions have resulted in the rise of KPI dashboards amongst decision-makers. The use of visual displays is a captivating and easy way to communicate critical details about a business’s performance. As KPI dashboards have become more widespread, they have also become more sophisticated in how they source, manage, and present data. 

Implementing KPI dashboards can be an extremely effective way to get the most out of your CPM processes. In this FAQ we will discuss what a KPI dashboard is, why it is important, and how to build a KPI dashboard. 

What Is A KPI Dashboard?

A KPI dashboard is a visual display of various key performance indicators, metrics, and other important points of information that managers need to assist them in the decision-making process. You can think of a KPI dashboard in much the same way that you view a car dashboard. In a car, your speed, RPMs, and other important information relating to the performance of the vehicle is displayed in an easy-to-interpret way. 

The need for KPI dashboards has increased over the years as transactions have become more complex and have increased in volume. In addition, developments in inventory management and supply chain management have created a need for organizations to operate as efficiently as possible, forcing decision-makers to rely on tools like KPI dashboards more heavily.

Traditionally, KPI dashboards have been used to monitor corporate strategy and how well the business is responding to the strategy being implemented, or how effectively the strategy is being executed by the organization. Modern applications of KPI dashboards are used heavily to monitor operational performance and processes.

Why Are KPI Dashboards Important?

There is an obvious benefit to having relevant and critical information at your fingertips. Decision-making can be done quicker with more certainty as the access to quality information is instantaneous and requires little interpretation. This is because KPI dashboards should only be presenting the most pertinent indicators of performance. 

The benefits of KPI dashboards extend beyond senior leadership as they can be used throughout the corporate structure to ensure that operations are moving in the correct direction. Even on the ground floor, staff can utilize KPI dashboards to effectively manage the day-to-day tasks they are responsible for.

This helps create a mechanism for accountability throughout the organization as each individual who relies on a KPI dashboard can be measured against their ability to manage the metrics that are presented in it.

Finally, KPI dashboards give meaning to the vast volume of raw data collected throughout the transaction processes of the business. KPI dashboards aggregate all of this information and autonomously categorize, group, calculate, and in some cases forecast it to represent key indicators of performance in real-time. 

5 Best Practices When Designing A KPI Dashboard

Before getting into the best practices of designing KPI dashboards, it is important to note that too much information can be a made thing. Remember, that KPI dashboards are visual and therefore can lose effectiveness if form takes precedence over function. 

Information overload can lead to poor decision-making or even slow down the decision-making process by inundating users with redundant or hard to interpret information. Keep in mind that when designing a dashboard, the ability for users to easily interpret what is being presented is absolutely critical. 

Here are five best practices when building a KPI dashboard: 

Limit The Size Of Your Dashboard To One Screen

Extending the size of your dashboard to require dual monitors or odd resolutions will only diminish the effectiveness of the information being presented. Limit your dashboard to one screen or page to ensure information can be gathered quickly and presented concisely. 

Only Include The Most Important Information

As its name suggests, the information presented in a KPI dashboard should only be the most critical or necessary to the decision-making process. In order to minimize its visual footprint, this will be mandatory.

Ensure The Dashboard Is Accessible

This might seem obvious, but once you have determined who should have access to the KPI dashboard it is important to provide the tools for them to have it. Certain software applications have hardware requirements and it is important to hash out all of the infrastructure demands that exist. Be sure all those who will be relying on the dashboard have appropriate technology and the means to utilize it effectively.

Avoid Excessive Design

KPI dashboards should be easy to read and you should avoid unnecessary design elements that might reduce the ability of the dashboard to provide clear, concise, and relevant information. 

Make The Dashboard Intuitive

Design the dashboard to be intuitive and easy to understand. It is important that users can navigate it easily. 

Using Datarails, a Budgeting and Forecasting Solution

Datarails’ FP&A software replaces spreadsheets with real-time data and integrates fragmented workbooks and data sources into one centralized location. This allows users to work in the comfort of Microsoft Excel with the support of a much more sophisticated data management system at their disposal. 

Every finance department knows how tedious building a budget and forecast can be. Integrating cash flow forecasts with real-time data and up-to-date budgets is a powerful tool that makes forecasting cash easier, more efficient, and shifts the focus to cash analytics. 

Regardless of the budgeting approach your organization adopts, it requires big data to ensure accuracy, timely execution, and of course, monitoring.

Datarails is an enhanced data management tool that can help your team create and monitor cash flow against budgets faster and more accurately than ever before.