Manage Learn to apply best practices and optimize your operations.

Diving Into Executive Dashboards

Bells, whistles and whiz-bang results help make dashboards all the rage. But you could become one angry executive if you don't follow the rules of the road when it comes to building your own.

Are you gearing up for a dashboard project? It could be dangerous. Let these CIOs guide you down the right path.

When Eastern Mountain Sports Inc. launched the first of its Gearage stores, warehouse-style outlets targeted at the extreme sports set, CIO Jeff Neville wanted to make it easy for company executives to monitor the success of the edgy new concept.

But when it came to building a strategic dashboard, Neville hit a brick wall that even the best-equipped climbers couldn't scale. The company hadn't established guidelines for evaluating the performance of Gearage stores. How should the stores be compared with other EMS outlets? And who should be responsible for the metrics that did exist?

"Using a dashboard to track the new stores was a good idea, but there wasn't a business process that made it a great idea," Neville says. "It was a good learning experience for EMS. Now we understand you just don't throw stuff up on the dashboard because it's cool."

The $200-million outdoor retailer in Peterborough, N.H., learned what many other midsized organizations have discovered: An effective dashboard is more than just a pretty interface. Giving executives real-time visibility into the core metrics that drive costs, revenues and efficiencies means conquering IT and business process challenges that are more complicated than they first appear.

"It's like the check-engine light in your car. It goes on, but it doesn't tell you what's wrong. There's no ability to drill down," says Colin Snow, vice president and research director at San Mateo, Calif.-based Ventana Research, which specializes in business process management. "At that point, we call it a 'flashboard.'"

Business intelligence is one of the hottest technology sectors around: This year it displaced security as CIOs' top technology priority, according to a 2006 Gartner Inc. survey of 1,400 CIOs. According to the study, BI license revenue is estimated to reach $2.5 billion this year, growing by more than 6% compared with last year.

Fueling these investments are dashboards, made popular by their ability to display so much information with easily recognizable icons such as speedometers, gauges and traffic lights. The word "dashboard" is often used by people who are talking about portal or scorecard technology. Many industry analysts consider it helpful to think of your dashboard as a tool that focuses on communicating performance information -- a subset of your scorecard. It offers high-level summaries of a large number of diverse metrics and variables. A dashboard is highly customized and ideally represents the most crucial data necessary to meet business objectives -- true alignment between technology and business.

"They're hot everywhere -- and in the midmarket absolutely," says John Hagerty, a vice president and research fellow at AMR Research. "People are really looking for ways to make performance data accessible to a broad audience, which means they need to make it easy to use and simple to understand. And that's really what dashboards and scorecards do; they make it easily consumable." Among companies with revenue of less than $1 billion, 15% have implemented dashboards, according to an AMR study last year. And dashboard projects were being evaluated by twice that number.

"Companies are confronted with two information problems: too much and too little," adds Wayne Eckerson, chief research officer at the Data Warehousing Institute, an association of business intelligence and data warehousing professionals based in Seattle. "Dashboards solve both those problems in ways tools haven't in the past."

But achieving a balance between necessary metrics and too much data -- and delivering results in ways that C-level executives, store managers and suppliers can use -- requires carefully defining business processes as well as a host of other issues. These range from data quality and data integration to choices about staffing and spending.

"It can be dangerous if people want a dashboard but don't want to pay a lot of money for it," says Eckerson, and then wind up just jazzing up an Excel sheet. "You may know what's going on [in the business], but not what to do about it," he says. And Gartner research director Bill Hostmann warns, "We consider it a fatal flaw to think you can put a dashboard over this jungle of information and make it deliver useful information."

Pushing Data Inside Out
Florida Rock Industries Inc. is among the companies that are making a first foray into dashboards by building one for external customers.

For the $1-billion Jacksonville, Fla.-based distributor of construction materials such as sand and gravel, it's a fairly regular occurrence when a customer loses a shipping receipt or needs to check an account balance. Regular enough that Florida Rock decided to build a dashboard to save its customers the frustration and its employees hours of time.

With help from Noetix Corp., a Bellevue, Wash.-based BI vendor, Florida Rock built a dashboard that gives 250 of its largest customers a full view of account histories; a PDF shows their purchases, payments and invoices. The company plans to add Global Positioning System technology so customers can follow their shipments of crushed stone as they move across the country.

"The Noetix foundation is built to bring up an internal dashboard quickly and pull from any data source," says Dave DeVore, manager of application development. "There were two things that were missing from the application: a Secure Sockets Layer to put the dashboard outside our firewall and internal document management." With help from Noetix, Florida Rock added those features. "The beauty of this is we're a total Oracle shop, and we can easily link into our eight different databases of information. We can combine them all into that dashboard."

Now, seven months into the project, there's been a noticeable decrease in calls to customer service, DeVore says. "This alleviates the tedious work that our service department deals with. It's saving us probably 40 hours a week of manpower at the home office."

--B.B.

Anxiety, Expectations and Delivery

As EMS discovered, before you can build a dashboard, you need to agree on the metrics that are most meaningful to those who will be using it. "If I just put cold numbers up, I'm going to get way overloaded," says Neville. "But if I have a tool that allows me to do my job in an exception-based way or a workflow way, I'm not going to get overwhelmed."

At Cubist Pharmaceuticals, a $120-million Lexington, Mass.-based company, choosing metrics for a dashboard project required some grassroots change. It was January 2005, and as part of the annual budget review process, Cubist executives instructed each department to create three metrics by which its success could be measured. Some people pushed back. One division, with a $48-million budget and 42-person team, came back with just one metric, recalls Anthony Murabito, Cubist's vice president of information technology.

And some were anxious about how visible their performance indicators would be. "Senior management had reluctance, thinking, 'This is going to be a hammer, and [Cubist CEO] Mike Bonney is going to beat me up with it,'" Murabito says. The company ultimately brought in consultants who led the various groups through exercises to help determine which metrics would be most useful and assuage concerns. "That was when people went from skeptics to advocates," Murabito says. "The breakthrough didn't happen with leadership. It came from the trenches."

Once the dashboard was up and running, the payoff came quickly. The company was able to use sales and location information in the wake of Hurricane Katrina to send supplies of the company's flagship drug, the antibiotic Cubicin, where they were needed as refugees moved out of New Orleans to surrounding areas.

"We started moving supplies before they were requested. At the end of the day, although we lost business in New Orleans, we made it up in the surrounding areas," Murabito says. The effort has been so successful that Murabito is working to give employees in every department some sort of dashboard by the end of the year.

Cubist designed its first dashboard with some help from the analytical tool DecisionSite, from Spotfire Inc., a Somerville, Mass.-based software company. Indeed, many companies choose to build their own dashboards rather than buy configured dashboard software -- 64%, according to a recent survey by Ventana Research -- because CIOs doubt they can find the metrics for their business in a box. "We haven't yet had a need come up where we've said, 'We can't build it,'" Murabito says.

The leading BI vendors -- Business Objects, Cognos, Information Builders and SAS Institute, according to Gartner's latest BI Magic Quadrant -- all offer dashboard building tools and are clamoring for midmarket customers, as are the largest enterprise application companies. In April, Oracle Corp. revamped its BI package with the addition of analytics tools it acquired with its purchase of Siebel Systems and began marketing a suite aimed squarely at the midmarket. At the same time, Microsoft acquired partner ProClarity Inc. to bolster its analytics offerings and target midsized firms. Plenty of smaller vendors such as Arcplan Inc., based in Wayne, Penn., are focused solely on providing dashboards and scorecards.

"Most dashboards are built rather than bought," Eckerson says. "But that's changing as vendors offer more robust dashboards and scorecard tools," he says.

Ventana survey respondents complained about difficulty in defining key performance indicators, or KPIs, an inability to change perspectives on the fly and trouble sharing reported metrics with other applications such as Microsoft's PowerPoint. Ideally, any performance alert should allow a user to drill down, find a root cause and take corrective action. To that end, Snow believes many IT shops are neglecting out-of-the-box dashboard software that can extend capabilities as their companies and the number of applications and employees grow.

Regardless of approach, IT executives need to realize that building a dashboard isn't a onetime thing. Once users see what it can do, they ask for all kinds of data to be connected to it. At EMS, Neville plans to keep integrating new data sources during the next couple of years. "It's not necessarily like the old data warehouse," he says. "The challenge I'm also talking about is being able to integrate different pieces of information that may come from different systems or places. But it all may live in a 2-by-2 world on a Web page."

Guiding Dashboards to the Expert Level
One rainy morning this spring, Eastern Mountain Sports Inc. CIO Jeff Neville strode into his Peterborough, N.H., office for a view of something almost as sweet as a sunset on the White Mountains.

Neville could see the company's lightweight, waterproof Thunderhead parka, built with proprietary nylon and priced at less than $100, flying out of stores across New England. On his executive dashboard, Neville could determine not only the rate of Thunderhead sales but also which EMS outlets were busiest, whether men's or women's parkas were selling fastest and, perhaps most important from a strategic sales perspective, which outdoor hiking accessories parka shoppers were buying at the same time.

About 75 employees at EMS' headquarters use executive dashboards to track key performance indicators at the company, which was founded in 1967 by two rock climbers who had enough business intelligence to know there was a demand for high-quality mountaineering tools among hardy New Englanders. Today, EMS records annual revenues of $200 million, runs 85 outlets in 13 states and is among the midsized companies fueling what industry analysts like to call "the dashboard craze."

"This is the way we run our business," says Neville, who reports to the company's CEO and, as CIO, is responsible for managing inventory and sales for the company's Web site. Neville spends the first 20 minutes of every workday examining his executive dashboard. "My director of e-commerce knows that I've been looking at it because I'll have four or five questions when she walks in the door," he says.

EMS used Information Builders' WebFOCUS, a Web-based reporting tool, to help develop its dashboards.

"We see certain trends from a cross-selling perspective," Neville says. "When we sell boats, more often than not we also sell a car rack. Managers can make sure that when sales staffs are building boat displays, they have the car racks nearby."

Currently Neville is expanding the EMS dashboard into a corporate "playbook" to give everyone in the company instant access to the latest monthly goals from the CEO, corporate performance metrics and tasks for the day, all based on recipients' job function. He's also looking to expand the number and types of data that the dashboard can access.

"The executive team sat down with the CEO and said, 'We need to figure out a way to communicate monthly goals and objectives.' We came up with the concept of a playbook and translated them to the dashboard. You can think about these like one-page documents for things like theme promotions, merchandising or financials."

Neville says his dashboard mission statement is clear: "Everyone in this organization knows what they have to do to make this business successful."

Now, seven months into the project, there's been a noticeable decrease in calls to customer service, DeVore says. "This alleviates the tedious work that our service department deals with. It's saving us probably 40 hours a week of manpower at the home office."

--B.B.

A Yellow-Light Strategy

The challenges of data quality and integration raise the question of resources, which Gartner's Hostmann says is the biggest problem with dashboard deployments at midmarket companies. "If you're talking about giving 30 salespeople a report, you can probably do that internally. But when you start getting into a couple hundred people with complex rules, you can burn a whole lot of time, effort and credibility," Hostmann says.

CIO Jim Craig at Cooper Communities Inc., a land development and time-share company with revenues of less than $500 million, has only 14 people on his IT staff. When the time came to build a dashboard, Craig adhered to a cardinal rule of successful dashboard development: Use phased rollouts and measure success along the way. He tested a prototype of the dashboard in the company's Escapes division, the business unit that manages the company's property sales and management.

"We don't invest a ton of money in technology, and we invest prudently," says Craig. "I wanted to position the IT organization here so that when the need came up, we would be ready to deliver."

The need for mobile data became apparent at the Rogers, Ark., company two years ago, when one particularly information-hungry executive wanted the latest sales figures to pass along an "Attaboy!" to a high-performing rep or a kick in the pants to a slacker. He made almost hourly calls to the office to get the latest numbers. "Someone here was relaying it over the phone," says Craig. "The more information that was relayed, the more it could get garbled. At the very least, it was an inefficient way to get this information."

So Craig set out to provide executives with mobile access to information. What emerged is what Craig calls "ubiquitous business intelligence": a set of metrics such as revenue per guest and average selling price of a time-share unit. The display shows how the metrics compare with the company's historical performance, providing the context. Users receive it on their Treo 650 phones.

"You can take a picture and say, 'That's bad' or 'That's good,' but you have to see it in motion," Craig says. "That's what our dashboard is providing -- not just a snapshot of a moment in time, but what got us there. If a dashboard is just a snapshot of the way things are right now, you're missing something."

Barney Beal is the news editor at SearchCRM.com and SearchDataManagement.com, sister sites of CIO Decisions and SearchCIO.com. Write to him at bbeal@techtarget.com.

Dig Deeper on Small-business infrastructure and operations

Start the conversation

Send me notifications when other members comment.

Please create a username to comment.

-ADS BY GOOGLE

SearchCompliance

SearchHealthIT

SearchCloudComputing

SearchMobileComputing

SearchDataCenter

Close