Financial Management

16Dashboards and Key Performance Indicators

The use of performance measures and dashboards has exploded over the past 30 years. The effective use of key performance indicators (KPIs) and dashboards is illustrated throughout this book. This chapter will deal with some specific techniques in selecting and developing measures and dashboards.

OBJECTIVES OF DASHBOARDS AND KPIS

Organizations that effectively use performance measures and dashboards spend a great deal of time thoughtfully selecting appropriate measures and developing dashboards that are relevant to the organization's objectives and challenges.

Too often, organizations adopt measures or start using so-called canned dashboards without properly vetting what should be measured. Before jumping into KPIs and dashboards, it is very important to develop a context and framework as was explained in the previous chapter, an introduction to enterprise performance management (EPM).

As a potentially very useful part of EPM, we must start by focusing on the objective of EPM. We want to provide executives and managers with the information they need to run the business and achieve strategic goals. The cockpit of an aircraft provides us with a very useful visual to guide us in the selection of measures and the development of dashboards (Figure 16.1). I reflect on this image frequently during any EPM project.

Photo used with ...