A “business dashboard” is really not much more than a list of business metrics, generally with a simple indication, such as color coding, that indicates whether the particular metric is in line with expectations, performing at less than expected levels or if the metric seems to indicate a problem and needs to be researched and addressed in some way.
I’m a strong advocate for every company maintaining a simple dashboard that is updated with a few key measures. I believe that this is especially important for smaller companies, simply because larger companies have CEO’s and often shareholders and along with those come certain reporting responsibilities or expectations. The problem for many smaller businesses is that it’s easy to fly a small business by the seat of your pants and assume that everything is okay if the bottom line is where it should be.
Depending upon your business, and your competitive position, there are a number of possible business metrics that you could chose to track – here are some examples:
1. Industry Overview (ex: Product category growth or decline, Adjacent category development, Maturing product categories)
2. Company Performance (ex: Company Revenue, Profit Margins, Cost per widget produced)
3. Customer Acquisition and Retention (ex: Major Account retention, New customer acquisitions or trials)
4. Competitive Factors (ex: Number of competitors - maybe in a certain customer segment, or within a certain radius, Competitor’s positioning - or key selling points)
5. Employee Satisfaction (ex: Consider this an excellent place to work, Would gladly recommend this company to a friend as a good place to work)
Initially a dashboard simply forces management to identify a few key metrics and provides an assessment for a single period of time. However, over time, a dashboard provides a longer term look that may help to identify important trends, or opportunities and even threats. It will also help to focus your company on the an identified subset of broad indicators that will helpfully reflect the overall health of your business, and the progress you are making towards your businesses goals.
What metrics would you include for your business?
Chris
