As a very strict rule, I am against any form of management speak or tortuous metaphor in the workplace. This, however, is different. This is not a metaphor in that what I am talking about here is actually a dashboard.
Think of the dashboard in your car for a second – what does it give you?
It includes a few key measures about the running of the car and it includes warning lights for some of the measures that are not constantly displayed. It is constantly in your field of vision, it is real time, and it is easy to read. In some of the latest models it is even customisable.
It is something so common that it’s easy to underestimate its importance.
I am reminded of a story of an ex-colleague, who, on arriving at an overseas airport, opted to get in to a “taxi” only to discover that none of the dashboard instruments were working. He immediately wanted to leave the vehicle as he felt unsafe – but of course his journey was already underway so he just had to hope for the best. As if that wasn’t bad enough, roughly halfway through the journey the bonnet flew open and jammed in an upright position in front of the windscreen. And as if that wasn’t enough, rather than pull over and fix the problem the driver opted to finish the entire journey with just a small gap under the bonnet to see through.
I tell this story as it highlights two important things: firstly, as soon as the dashboard is not there you realise how important it is; and secondly, the sort of person who is happy to proceed without a dashboard is also happy to proceed with a fraction of the view of the road ahead.
Extreme maybe, but you don’t want your business to be that guy.
Not surprisingly, given that it is Corner Finance’s most powerful business tool, I have a huge list of dashboard benefits. Below are just the top 10, just in case you needed any more convincing.
1. Maintain control of your larger business
As a business grows, it can become impossible to manage in the way it has been managed previously. It becomes too big and unwieldy to stay across it at all times. A dashboard enables you to see the headlines from across the whole business at a glance while not having to be in the detail all the time.
The dashboard is your one reference point, your single version of the truth – guaranteeing consistent information at all times.
Not only does this give you the freedom to rise above the detail, but it also enables effective delegation. You can be sure to be close enough to the key elements to be able to react when necessary. See also “Peace of mind” below.
2. Manage your risks
Risks can appear from anywhere and at any time. The trick is to be able to spot them and spot them early. With the right measures on your dashboard, you can be sure that the risk red light will appear whenever there is something requiring your attention. By managing risks by exception it means you don’t have to worry constantly and divert your attention away from what is important.
3. Optimise your decisions and investments
Good decisions need good data and they need up-to-date data. Good dashboards provide both.
With current information and innovative measures, you can be sure of making the best possible decision at any point.
The best example of this is deciding when, how and if you should invest – particularly in an uncertain environment. A dashboard helps you evaluate the options to make the decision. It also helps you to monitor the effect of that investment to determine if it was a success or if you need to try something different. Constant monitoring and feedback ensures ever smarter decisions and compounded success.
4. Set your course and maintain it
Setting the course for your business can be a challenge – a dashboard can help not only with the initial decision but with the ongoing monitoring.
By having a selection of measures that focus on the slightly longer-term, you can make simple changes to your current decisions to ensure you are still heading towards your ultimate goal.
5. Pounce on opportunities
All businesses need to evolve to survive, and in a competitive market-place they are all chasing the same opportunities. By ensuring your dashboard displays innovative trends and insights you can give yourself the best chance of unearthing the next opportunity first – regardless of which area of the business it originates in.
What is more, by including non-financial data, financial data, and data from the wider industry too – as is the case with Little Big Data® – you can maximise your chances of getting there first.
6. Achieve peace of mind
This is largely a function of everything that has gone before, but don’t underestimate its importance. By taking the pressure off having to individually monitor every department, every transaction, every industry update, and every potential risk, you can achieve a level of confidence that feeds peace of mind. Removing some of these stresses means you can think more clearly and function better – meaning better decisions, and a virtuous circle.
7. Free yourself
Managing a business is time consuming – there is no getting away from that – and your time is a finite resource. By reducing the physical time it takes to monitor your key financials, you free up more time to focus on the day-to-day business.
Not only that, but combine more time with less worry and you find yourself being more productive and having more time to stop and think. These are the moments when you are at your most creative and likely to come up with your best ideas. Another virtuous circle.
8. Enforce prioritisation
Faced with a practically limitless set of choices for your business, but limited resources and attention span, you are forced to prioritise.
The first step in establishing any good dashboard is to think long and hard about what is really important to your business and what you want to achieve. A good dashboard should fit on to one page so that you can see everything at a glance. This constraint gives you the discipline you need to only include what is most important to you.
Comparing your business with other businesses in your industry, or with similar businesses in other industries, is a healthy practice that can point you towards continuous improvement.
A good dashboard will include a set of metrics that help you to easily monitor your performance against suitable comparisons. This means you can constantly adjust without embarking on big standalone benchmarking exercises.
As a rolling measure rather than a periodic update, it will also ensure you are not caught out by sudden changes in the industry that you should be aware of.
10. Keep score
Finally, the fundamental principle of the dashboard – if you are not keeping score then you are just practicing.
This doesn’t need to be as ruthless as it sounds – how you use and react to those scores will of course reflect what is important to you and your own business culture, but without knowing the facts how can you ever expect to improve and grow?
So there it is. Think it through carefully, set it up correctly, adjust it as you go, and make sure it uses your data in a smart way and a dashboard will be the best business tool you could hope for.
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