Note from the editor: This is the fourth in our series of BI-focused blog posts. Thanks again to Bob Johansen for sharing his expertise as the head of the Deltek BI Affinity group. If you want to learn more about BI & Vision Performance Management, please register for this on-demand demonstration or read this whitepaper.
If you have been reading my posts you know that the science of Business Intelligence is all about analysis and trending. It is visualizing data to make good decisions about what the data is telling you. A good dashboard helps you know what actions to take next, having seen the information. But how do you know what metrics you should be looking at? How many metrics do you need to run the company?
Ask any ten data analysts to tell you how many metrics are the ideal number to be looking at on your dashboard and, likely, you will get ten different answers. Some opt for a small number, say three or four, while others will advocate for a much higher number. I have been reading Malcolm Gladwell’s book “Blink” lately and, although it is about unconscious thinking, there is a lesson in there for us. In chapter 4, Gladwell writes about the dangers of having too much information. You see, some information is good as long as it is the right information. The persnickety problem about having the “right” information is that you might not know what the “right” information is. In lieu of having the “right” information, the temptation is to measure everything and throw it all onto a dashboard. If it is all on there, then you have it covered, right? Probably not. The main issue, according to Gladwell, is that our brains are easily confused by information that we think is important, but just might not be important. To relate this to a BI dashboard, too many metrics only serve to confuse us and make us uncertain of what is truly important.
Ah, but can you know what is truly important? Is it even possible? Of course. It all comes back to your business strategy. Let your business strategy tell you what is most important. Then build ways to track the important stuff. Your dashboard should display only the things that are important to you. Anything else and you risk having too much information. As they say, if everything is a priority, then nothing is.
Are there interesting metrics your firm is tracking? Please let me know in the comments.