Originating from the cockpit of aircraft, where pilots relied on instrument panels to monitor flight parameters, the concept of dashboards was adapted for business use in the 1970s with the advent of decision support systems. Since then, they have evolved significantly, leveraging advancements in technology to provide real-time insights and empower informed decision-making. In the digital age, where data is abundant but attention spans are limited, dashboards play a vital role in helping organisations stay agile, competitive, and responsive to changing market dynamics.
Driving business insights: A guide to building an effective dashboard
In today's world, where businesses rely heavily on data, dashboards play an important role in facilitating decision-making processes. A dashboard is a visual representation of key performance indicators (KPIs), metrics, and other critical data points, consolidated into a single interface for easy interpretation and analysis.
Having a well-designed dashboard is like having a superpower in data analysis. It lets you see the big picture without having to sift through mountains of data. By simplifying complex information and presenting it in a clear, easy-to-digest way, a good dashboard helps you make faster, more informed decisions.
Take Minard’s famous visualisation of Napoleon’s 1812 march, for example. It’s hailed as one of the best data visualisations, because it crams loads of information — such as troop numbers, temperatures, and the route taken — into one clear, concise display. That’s the power of a well-designed dashboard: making the complex simple and the important obvious. This principle of good data visualisation remains unchanged, emphasising the timeless effectiveness of presenting information clearly and concisely.
But not all dashboards are created equal. They come in various types, each serving a specific purpose.
Types of dashboards
Operational dashboards focus on real-time or near-real-time data against key metrics and KPIs, such as sales performance and inventory levels. They update frequently, providing frontline workers, supervisors, and team leads with insights vital for daily operations. These dashboards are seamlessly integrated into daily workflows, offering contextual information for users to make timely decisions. Metrics tracked may include website performance, social media engagement, and return on ad spend.
Strategic dashboards monitor high-level KPIs related to overall business performance, such as market position and financial health. They may update less frequently, catering to executives and senior management officers who need to assess long-term trends and objectives. These dashboards play a crucial role in guiding strategic decision-making, ensuring alignment with organizational goals. Metrics tracked may include financial performance, growth rates, and EBITDA.
Analytical dashboards process large volumes of data to identify trends, predict outcomes, and provide deeper insights for informed decision-making. Traditionally designed by data analysts, they are now accessible to various roles within the organization, including marketers, founders, and executives. These dashboards offer in-depth analysis capabilities, enabling users to explore data and uncover actionable insights to drive business strategies. Tracked metrics may include user growth, revenue drivers, and product conversions.
Tactical dashboards bridge the gap between strategic planning and operational activities, offering detailed insights into short-term projects and departmental goals. They provide real-time or near-real-time data for mid-management to track performance and make informed decisions regarding short-term initiatives. These dashboards focus on specific projects or departmental performance, monitoring progress against set targets and goals. Tracked metrics may include milestones reached, department-specific KPIs and OKRs, and product experiment performance.
Building a successful dashboard requires careful planning, a clear understanding of user needs, and thoughtful design. It’s not just about throwing data onto a screen, it’s about telling a story — a story that helps stakeholders make sense of the information presented.
With years of experience as a data analyst, I’ve developed dashboards for various business needs. Here are some of my insights or main principles on building dashboards that your stakeholders will love and that will empower them in their daily decision-making.
Understand the context
Before starting the creation of a dashboard, it’s important to grasp the context in which it will operate. Understanding the ‘why’ behind the dashboard is foundational, it elucidates the primary objectives it should serve. By discerning the typical questions that necessitate answers, one can tailor the dashboard to address these inquiries effectively. For instance, in a sales department, common queries might revolve around revenue trends, customer acquisition rates, or product performance. Identifying these key questions ensures that the dashboard provides actionable insights aligned with the organisation’s goals.
Design with end-users in mind
A key quality of successful dashboards is their user-centric design. To ensure optimal usability and relevance, it’s imperative to keep the end-users at the forefront of the design process. Consider their roles, responsibilities, and proficiency with data analysis tools. Tailoring the layout, visualisations, and language to resonate with the target audience enhances comprehension and engagement. Whether it’s executives seeking high-level summaries or analysts delving into granular details, accommodating diverse user needs fosters adoption and utility.
Choose the right data
Central to the effectiveness of any dashboard is the selection of pertinent data. Rather than inundating users with an abundance of information, focus on curating datasets that directly align with the dashboard’s objectives. Identify key performance indicators (KPIs) and relevant metrics that offer actionable insights. Prioritize accuracy, relevance, and timeliness in data selection to underpin informed decision-making. By streamlining the data to what truly matters, the dashboard becomes a reliable compass guiding strategic initiatives.
Build a story
Think of your dashboard as a storybook for your data. Make sure it tells a clear and compelling tale that guides stakeholders through the information. Anticipate how they’ll use it and structure the data logically to help them draw useful insights. Include important segmentations and distributions to enrich your story and allow stakeholders to explore further if needed. Use features like annotations and trend lines for clarity. A well-crafted story keeps stakeholders engaged and motivated to take action based on the data they see.
Provide interactivity and customisation
Empowering stakeholders with interactivity and customisation options enriches their dashboard experience. Incorporate features that enable users to explore data dynamically, such as interactive filters or drill-down capabilities. Moreover, aligning the dashboard’s aesthetics with the brand’s visual identity enhances its appeal and fosters brand recognition. Leverage customisable elements like specific fonts and colours to create a cohesive and visually appealing interface that resonates with stakeholders.
Test and iterate
The journey towards a successful dashboard doesn’t end with its initial creation, rather, it begins a cycle of continuous improvement through testing and iteration. Engage real users to solicit feedback and gauge the dashboard’s effectiveness in meeting their needs. Usability tests and stakeholder feedback sessions offer invaluable insights into usability, functionality, and relevance. Iterate on the design based on this feedback, refining features and layouts to enhance usability and drive actionable insights. By embracing a culture of testing and iteration, organisations can ensure that their dashboards remain agile and responsive to evolving requirements.
In summary, dashboards are crucial tools in today’s business world driven by data. Creating effective dashboards requires understanding the context, user needs, and relevant data. By following these principles, stakeholders can fully use dashboards to support strategic goals and improve efficiency. Continuous refinement is essential to keep dashboards aligned with evolving business dynamics and user needs.
As businesses navigate an increasingly data-saturated environment, the role of dashboards in synthesising information and empowering decision-makers is set to become even more pronounced. By embracing best practices in dashboard design and fostering a culture of innovation, organisations can leverage these powerful tools to gain a competitive edge and navigate the complexities of the modern business landscape with confidence.
Mariia Merkulova is a Data Analyst at Bumble.
