How to use strategic dashboards
Dashboards make up the core of most businesses’ BI strategy. They’re the main way that employees interact with the tool and provide a valuable bridge between the complex analytical operations of the BI solution and the real-world decision-makers who have to interpret those operations and turn them into insight.
They’re an extremely flexible tool, and since they’re so flexible, they can be used in many different ways depending on the needs of the business. Dashboards can be designed to help monitor business operations, give a strategic view of business goals, or delve deep into data analytics to find new insights.
There are three main types of dashboard—strategic, operational, and analytical. Each of these dashboard types helps to fill a different business need, and a well-rounded data strategy will involve all three types.
Strategic dashboards make up the basis of a business’s decision-making data suite. They provide a strategic view into a business’s progress towards its goals. With strategic dashboards, decision-makers get a strategic view of their operations. They get a sense of what’s working, what’s not working, and what to do about it.
Any business that wants to use data to accomplish its goals needs to learn how to effectively use strategic dashboards. Other dashboards are ill-suited for this specific purpose, and businesses that can’t build effective strategic dashboards won’t be able to use data to drive decisions as effectively.
Businesses need to know how strategic dashboards are different from other types of dashboards, when to use strategic dashboards, and how to build them to be intuitive and effective.
How are strategic dashboards different?
What makes a strategic dashboard different from the other types of dashboards? What sort of insight does a strategic dashboard provide that other types of dashboards can’t? What sort of elements make a strategic dashboard a strategic dashboard?
A strategic dashboard provides a high-level view into some broad aspects of business operations. Generally, this is to help businesses meet some broad strategic goal, but strategic dashboards can also help to monitor progress through projects or compare current trends to past or projected future trends.
One key element that sets strategic dashboards apart is benchmarking. With benchmarking, current trends are compared to past trends so that decision-makers can get a clear view of to what degree they’re succeeding or failing.
For example, a manager might want to see how their branch’s current sales performance compares to last month’s performance. They might create a simple line chart that shows how performance has trended month-over-month. With this visualization, they can see exactly how their current performance measures up to their past performance.
This simple visualization could easily make up the core of an effective strategic dashboard. From there, the manager could add additional metrics that gauge current sales success, like total revenue, profit margin, and so on.
What makes this dashboard a strategic dashboard rather than an operational or analytical dashboard is how broad of a category it covers. Strategic dashboards are intended to give viewers a quick, somewhat surface-level view into the attainment of current business goals.
An operational dashboard might offer more granularity into things like sales by product and sales by employee, and would be more focused on current, real-time action. It wouldn’t provide the sort of insight into past performance that a strategic dashboard offers.
An analytical dashboard, on the other hand, would allow viewers to drill down, filter their data, and combine it in new ways, so that they could discover trends within the data set. Those sorts of dashboards are much more useful for data discovery and ad hoc analytics than for actually measuring business success.
The key things that set strategic dashboards apart from other types of dashboards are a broad view of a business topic, comparisons to past data sets to gauge performance, and a broad range of metrics that help to provide a wide range of insight.
When are strategic dashboards useful?
Strategic dashboards are most useful in situations where a broad, high-level view of some aspect of business operations is valuable. There are many situations across an organization where this sort of information is very valuable.
Executive dashboards are often more strategic than anything else. Executives generally value this sort of strategic, high-level information because they rarely make decisions about a specific business operation.
Senior managers and executives are far more likely to set broad, generalized strategic goals than specific, narrow goals. For example, a CMO is more likely to want to boost conversion rates by 15% across the board than they are to boost one specific campaign’s conversion rates in one specific marketing channel.
The average executive just doesn’t care that much about the specifics of business operations. They want a strategic view of the business operations that they care about, and they don’t want to have to sift through more specific data to find it.
Both operational and analytical dashboards present a level of information that executives and senior managers generally have no interest in seeing. Operational dashboards are too granular and specific for executives, and analytical dashboards require a large amount of user input to get valuable insight.
It makes sense that strategic dashboards would be the most useful for providing a strategic view of a given aspect of a business. Since they provide valuable, simplified insight, they’re the best choice for executive dashboards and dashboards for other high-level employees.
Other, lower-level employees can also make use of strategic dashboards. Often, it’s a good idea to make the information from a strategic dashboard available to everyone whose job is affected by the insight from the dashboard. This way, everyone’s on the same page and can understand the justification behind high-level strategic moves.
How to build effective strategic dashboards
It takes intent and know-how to build an effective strategic dashboard. BI users without much data visualization experience might end up putting together a dashboard that’s not focused enough to be strategic, or isn’t high-level enough, or just isn’t clear enough to be easily used for insight.
There are a few key data visualization choices that are key to building an effective strategic dashboard. These data visualizations help to focus a dashboard’s intent, allowing it to better communicate its insight.
Most strategic dashboards have some sort of benchmarking metric. These metrics compare current performance to past data, which allows for a clearer picture of how performance is trending overall.
Benchmarking metrics are best presented in a way where past performance trends can easily be compared to current performance. Often, these metrics are placed on the same graph or chart, so that users can easily visually compare the metrics. This sort of visualization works best with simple charts like bar or line graphs.
Strategic dashboards often have aggregated data rather than data that’s separated out into different categories. Sometimes, there might be an ability to drill down into aggregated data to get more specific insight, but this ability is generally more analytical than strategic.
For example, a strategic dashboard that’s tracking sales will probably have an aggregated ‘Total Sales Revenue’ metric somewhere on the dashboard. It won’t usually have that total sales revenue split up by region, sales team, or product. Those sorts of metrics are more useful on analytical dashboards.
Strategic metrics should also be easy to understand. Since these dashboards are intended to provide simple, quick insight, users shouldn’t have to spend much time with the dashboard to draw valuable data inferences from it. That means simple visualizations like line charts, bar graphs, and scorecards are the most effective.
In general, strategic dashboards blend benchmarked visualizations like line graphs and bar charts with simple, company-wide metrics presented on scorecards or through gauges. This way, dashboard users can easily draw high-level insights from the dashboard without interacting with it too much.
Tactical dashboards
In some cases, BI users want a dashboard that provides the sort of strategic view on a topic that a strategic dashboard provides, but they want the dashboard to cover a much narrower topic than a regular, high-level strategic dashboard.
When a dashboard builder wants to provide a strategic view of a topic that’s too narrow to build a regular strategic dashboard with, they can build a tactical dashboard, which can provide exactly that.
Tactical dashboards are a subcategory of strategic dashboards that use the techniques of strategic dashboards to provide a high-level view of a narrow business topic. This way, lower-level managers and employees can access the value of strategic metrics while still focusing on the aspects of the topic that actually matter to them.
One use case for tactical dashboards is in businesses with smaller local branches. A company-wide sales dashboard might provide valuable company-wide metrics, but it might not accurately represent the data of each individual branch. Each branch needs their own smaller tactical dashboard, so they can get a high-level view of their own operations.
This isn’t the only situation where tactical dashboards have utility that broader strategic dashboards lack. Tactical dashboards are also useful for monitoring progress on tasks that are limited in scope or that don’t have past data to compare to, like ad hoc projects.
Strategic dashboards—valuable executive insight
Strategic dashboards are some of the most valuable dashboards that a business can create and share with their BI tool. While they’re most useful for making high-level, strategic decisions, the sorts of decisions that executives and senior staff might make, strategic dashboards can be useful at all levels of a business.
Whether it’s executives using a strategic sales dashboard to track revenue and make important financial decisions, or lower-level managers using a tactical dashboard to make decisions about things important to them, strategic dashboards are especially important for any business’s data strategy.