Why are dashboards important? Dashboards allow you to present data from across your business in a way that’s easy to digest. With a consolidated view of data and insights, they also play a key role in helping to derive actionable insights and tell the right stories to the right stakeholders to propel business performance.
There’s no shortage of ways to use dashboards. For example, if you work in a finance department, dashboards can help you provide real-time data to your stakeholders on things such as sales performance, operating expenses, profit and more to help them make informed decisions around where to invest in the business.
Let’s dive deeper with a more detailed look at how and why you should leverage dashboards.
Why Use Dashboards?
Understanding the purpose of a dashboard—as it relates to your particular company, department and position—can help you determine where it fits into your day-to-day responsibilities.
The more you use business dashboards, the more benefits you’ll come to realise. Here are five of the top reasons to use dashboards:
1. Time Savings (and Less Stress)
Without a business dashboard, you (and others on your team) will spend countless hours manually chasing data and running individual reports. Not to mention the fact that you’ll have to wait on co-workers to provide you with some of the information you’re seeking.
The more time you spend on these tasks, the less time you spend on your core job responsibilities. And that will quickly take a toll on your performance.
A dashboard pulls together all the data you need and allows you to review it in real time. Not only does that save you time, it also reduces your stress level.
2. Real-Time Analytics
Do you often spend hours on end searching for data (see above)? Do you wait until the end of the month to review reports and make the necessary changes?
Real-time analytics can save you from these types of problems. There’s no more searching or waiting. Instead, when you need access to real-time analytics, it’s available with a click of your mouse.
Adding to this, dashboards share data in a visually pleasing and easy-to-interpret environment. This makes it easier to review data, pinpoint the good and the bad and take action as necessary.
3. Efficient Sharing
When was the last time you shared complex, in-depth data without the use of a business dashboard? Even if it was a long time ago, the memories of your frustrations are probably fresh in your mind.
The more data you need to share and the more people who need to see it, the more complicated it becomes. You’re sending and receiving emails and Slack messages. You’re texting co-workers for updates. You’re scheduling meetings that take you away from other projects.
A business dashboard eliminates all these potential problems. There are many ways to share, such as:
- A link to a report
- Downloadable PDF
- By adding others as a user or admin
With more efficient sharing, every team member has access to the same real-time analytics and reports.
4. Detect Problems With Performance
Imagine a situation in which you rely heavily on month-end performance reporting. With this approach, a problem could slip through the cracks for up to 30 days. By the time you realise something is wrong, it’s snowballed into an even bigger problem.
A data dashboard ensures that you don’t have to wait days, weeks or months to review key performance indicators to detect performance issues among your team.
Also, when your team knows that you’re actively monitoring data in real time, they’re more likely to maintain a high level of performance.
5. Improved Decision Making
According to Harvard Business School Online, “today’s largest and most successful organizations use data to their advantage when making high-impact business decisions.”
But it’s not just large organisations that can benefit from using data to make better decisions. From solopreneurs to the Googles and Microsofts of the world, access to accurate and timely data improves the decision-making process.
The same Harvard Business School article shares the following:
The collection and analysis of data have long played an important role in enterprise-level corporations and organizations. But as humanity generates more than 2.5 quintillion bytes of data each day, it's never been easier for businesses of all sizes to collect, analyze, and interpret data into real, actionable insights. Though data-driven decision-making has existed in business in one form or another for centuries, it’s a truly modern phenomenon.
If you don’t take advantage of this “modern phenomenon,” you’re missing the boat in regards to a tool that can improve decision making from the top down.
Define the Purpose of Dashboards in Your Department
It’s one thing to understand the benefits of data dashboards, but that doesn’t answer another key question: what is the purpose of dashboards in your company or department?
For instance, dashboards can help improve financial reporting. Categories include, but are not limited to:
- Business health dashboard: Examples include net profit margin, revenue and LTV:CAC
- Customer health dashboard: Examples include net revenue retention, time to value and the number of active customers
- Employee health dashboard: Examples include revenue per employee, employee retention and employee survey data.
Define the purpose of a dashboard upfront so that you can get every last bit of value out of it.
Integrating Dashboards Into Your Processes
Now that you’ve answered the question “why are dashboards important to performance,” you can turn your attention to the following:
- Deciding which type(s) of dashboards you need
- Creating a plan for reviewing data
- Creating a strategy for using the data to chart performance and make better business decisions
If you’re ready to take the next step, our article on how to build a KPI dashboard is a great place to start.