BUS610: Business Intelligence and Analytics

7a. Explain the capabilities and limitations of dashboards for organizing and manipulating data and expressing analytic estimates 

• How do dashboards help humans understand and organize data?
• What kind of dashboards are there, and how does each support different levels of management?
  

BI uses computers to exploit data, but humans and computers understand data differently. Effective organizations ensure that their data is presented in ways that help their teams interact with it and use it to make decisions. BI Dashboards help make information accessible and useful for many purposes, such as monitoring and evaluation, personnel and activity management, procurement and inventory, pricing, and more. The visualization delivered through dashboards allows large, otherwise overwhelming amounts of data to be easily digestible and understandable. Identifying what the data means allows for more informed and relevant business decisions. Dashboards provide a place for interacting, evaluating, connecting, and visualizing data from multiple sources. While dashboards do provide greater visibility with information available, this does come with limitations, including but not limited to attempts to incorporate too much information without understanding constraints, coupled with no predetermined rules for how the metrics should be used. All of this can result in clunky, unusable data.
 
It is important to fit the correct type of dashboard to the requirements of a given managerial decision-maker. A dashboard is a tool used to manage information from a single access point. It helps managers and employees to keep track of the company's KPIs and utilizes business intelligence to help companies make data-driven decisions. Different dashboards are appropriate for different levels of the organization.
 
The types of dashboards include:

1. Operational Dashboard – Shows shorter time frames and detail on processes
2. Tactical Dashboard – Used by middle management to track performance
3. Strategic Dashboard – Focused on long-term objectives and high-level metrics
4. Analytic Dashboard – Contains large amounts of data to facilitate decision support and studies
   

Dashboards should be structured to report and communicate information to decision-makers. The idea is to rapidly convey the important KPIs efficiently. Any dashboard would provide information quickly. Dashboards should motivate managers to spend more time on the BI system by causing them to reflect thoughtfully on the data they are seeing. Better decisions often require more time spent on reflection and analysis.
 
To review, see Universal Dashboards.
 

7b. Compare various dashboard designs to evaluate how effectively they present key performance indicators (KPIs) from sales and customer retention to recruitment to company financials 

• Why do organizations develop key performance indicators (KPIs)?
• What are the elements of effective KPIs?
  

Note the primary reason for creating KPIs – to measure success against strategic objectives. Such objectives are often difficult to measure, but there is no way to obtain feedback without measures. The KPIs are the measures used to assess organizational performance against the identified critical success factors and targets developed by the organization as a part of the strategic planning process.
 
Measures must be developed for KPIs, and this can be a challenge since many of them are intangible or lack easily obtainable data.
 
KPIs should be:

1. Simple – A KPI should be as straightforward to measure as possible
2. Relevant – Ensures that the right decision-makers are responsible for measuring specific KPIs
3. Aligned – KPIs should support, and be derived from, the overall strategic goals of an organization
4. Actionable – They should be easy to understand, and users should know what to do to achieve an effective outcome
5. Measurable – KPIs should avoid generalized goals and provide specific insights into how the business is performing
   

Every organization is different, and so are its KPIs. To determine what is appropriate, linking KPIs to strategy and objectives is paramount to hone your focus and constant evaluation to ensure they are the most relevant KPIs. When choosing your KPI, focus on key metrics but remember to capture and identify those that are both lagging and leading.
 
To review, see 5 KPIs Every Business Must Consider.
 

7c. Describe the uses and differences among strategic, operational, and analytic dashboards 

• What are the different needs of different levels of management?
• How do dashboards support the different needs of different levels of management?
  

A dashboard is a tool used to manage information from a single access point. It helps managers and employees to keep track of the company's KPIs and utilizes business intelligence to help companies make data-driven decisions. Different dashboards are appropriate for different levels of the organization.
 
The level of decision-maker served by the dashboard will determine the requirements of the dashboard's scope and scale.
 
Dashboards can be designed, implemented, and deployed for every type of business, department, and function of a company. From recruitment of employees to sales, product monitoring, customer service live chats, and other areas. How the data is visualized makes a big difference. Charts in your dashboards, whether pie, line, or bar, can portray the same information but be misconstrued. Depending on what you wish to show, there is a chart type to suit your goal, but selecting the correct one means asking the right questions at the outset of your design process.
 
A temporal database stores results over time rather than just the current period results. These data are critical to strategic decision-making and must be included in a strategic dashboard.
 
Executive support of the most important critical success factors is critical because the executive makes everything else happen. They are responsible for supporting enterprise-wide data-driven decision-making by providing enterprise-wide support. This includes making sure the right resources are allocated to the initiative, assigning the right people to the team, and obtaining commitments from various departments in the organization. They are also responsible for helping the team work across departmental silos to access all of the organization's data.
 
To review, see Performance Dashboard Design.
 

Unit 7 Vocabulary 

This vocabulary list includes the terms that you will need to know to successfully complete the final exam.

• analytic dashboard
• dashboard
• key performance indicator (KPI)
• operational dashboard
• strategic dashboard
• temporal database