Upand$tarting

A major part of my day job involves tracking key company statistics and making sure the management teams understands where we stand at any point in time on our execution against our operating plan.  The trick is to prepare a document that accomplishes three things:

1.    A format that is consistent and easily digestible by management
2.    A system that allows for automatic updates or easy manual updates
3.    The ability to refine over time so that the information continues to be relevant

A format that is consistent and easily digestible by management

When preparing a truly usable dashboard the first thing to take into account is who the users of the information are.  Notice that I didn’t say data; data is raw numbers that require interpretation in order to digest.  Information is readily digestible and may be presented in an already analyzed format.  The users may have disparate requirements for your information and may be driven to perform against different measurements.  For example, your V.P. of Development may be most interested in manpower usage and cost, while the V.P. of Sales may be most interested in his pipeline.

The trick is to prepare a document that provides useful information to all and does it in a way that allows the users to compare over time.

I tend to favor building dashboards in Excel.  Excel gives me great flexibility in shaping data into information through the use of pivot tables, charts and graphs.  When presenting my dashboards to management, I usually convert the final document into .pdf, unless I have built in the ability to modify the presentation through drop-down fields, etc.

I prefer this method to using a built in dashboard in a specific application.  I find that most dashboards relay too much on the “car dashboard” analogy and suffer from it.  For example, Salesforce.com is a great CRM used by many small to large enterprises; they also have built dashboards into the product that allow for drill down capability.  I have had much better luck preparing and presenting sales information using Excel’s ability to link and pull data from the salesforce.com database, while maintaining the ability to dive deep into the information.

A system that allows for automatic updates or easy manual updates

If updating your dashboard is too labor intensive, then you have failed at creating a living document that can be used to manage the business.  In order to create a real, usable measurement tool in your business, it needs to be either automatically refreshed or so simple to update that it takes less than 5 minutes of anyone’s time to do so.  Also, if you are the only person who understands how to do this, then it is useless.

My goal in creating any dashboard is to allow the least technical user of the information to easily be able to update, an automatic refresh and revisioning is even better.

The ability to refine over time so that the information continues to be relevant

I believe that a dashboard is a living document and should be built with enough flexibility to allow you to modify it over time.  Business metrics should change over time (though not all), you should build in the ability to add or take away information without greatly modifying the core design of your report.

The numbers you should report

Though management dashboards should be fairly unique to your business and management concerns, there is generally a core set that every management team should be interested in.  I like to present all data weekly, framed in the subset of a quarter.  I also like to show quarter end budget numbers of all information (or monthly, if that time frame is relevant).

1.    Cash – not only cash on hand, but weekly collections (assuming you have any) and weekly cash spending.
2.    Accounts Receivable – what is cash is due to arrive
3.    Weeks of Cash – I find this number very easy to digest at any level, it is a function of cash in the bank added to accounts receivable, divided by the average weekly spend.  You can consider this your Cash Runway.
4.    Accounts Payable – tracking your commitments
5.    Sales – this is a funny umber for me, I generally don’t track revenue, but bookings; I am in software and GAAP has destroyed the relevance of revenue from a reporting aspect.
6.    Headcount – I would also track FTE’s against projects if necessary