How the best companies use dashboards to boost productivity
Read time: 3 minutes
The great management theorist Peter Drucker once observed: “What’s measured improves.” That’s never truer than when you want to improve your company’s operational efficiency.
By measuring your performance in key areas, you can evaluate how you’re doing compared to internal goals or benchmarks, such as industry averages. Then, you can get started on improving your results.
Yet, many smaller companies have no system for measuring their operating performance on a regular basis, says BDC Business Consultant Stéphane Chrusten. This hinders their ability to improve, or worse, exposes them to nasty surprises when things go seriously wrong.
Chrusten, a lean manufacturing expert, says a good way to introduce a measurement system to your business is to select key performance indicators (KPIs) and then use them to create performance dashboards.
Here are Chrusten’s tips on creating performance dashboards as part of a continuous improvement program at your company.
1. Select your KPIs
Your first task is to choose KPIs. The information should be easy for your employees to focus on, collect and understand. That’s because one of your main challenges will be simply getting employees to regularly collect and record the data so you can use it to generate continuous improvement.
For this reason, Chrusten also recommends monitoring only a few KPIs—no more than four per department based on your main corporate objectives and focus. He also recommends that companies devote their energy to improving in one or two areas where they have major operational challenges. This might include: lead time, inventory management, product quality, etc. Once you’ve attained your goals in your priority areas you can move on to work on others.
2. Set up your dashboard
Supervisors should be responsible for collecting KPI data on a daily or weekly scorecard. They then transfer the information to a dashboard—a paper‑ or software‑based system—where you plot data for each KPI on a graph. In this way, trend lines will emerge as the days and weeks pass.
3. Hold regular status meetings
On a daily or weekly basis (depending on your type of business), supervisors should meet with employees to discuss the performance dashboard. During the meeting, the team discusses what’s going well; what’s going less well; and where there are opportunities for improvement that will create a new positive trend. The idea is to create excitement about achieving better results. Supervisors should look to delegate responsibility to their employees and empower them to go beyond their regular duties and strive for continuous improvement.
A concrete example
Chrusten offered an example of how a performance dashboard works in practice. One of his clients—a food processor—needed to increase production to meet demand. Management started to investigate production downtime and noticed it was taking 45 minutes to start production in the morning.
By monitoring this KPI and working on improvements, the team was able to get start‑up time down to 20 minutes. The company believes it can eventually bring it down to 10 minutes.
“The KPI helped sustain improvement,” Chrusten says. “It’s very contagious. When you start improving your performance, you want to go further and further.”
Benefits of dashboards
Performance dashboards allows you to:
- Record and analyze results;
- Set measurable goals;
- Create awareness of improvement; and
- Mobilize your team and sustain continuous effort for improvement.
Chrusten says: “When you measure stuff and compare your performance to targets, it’s human nature to want to hit those targets and exceed them.”