- A new study suggests a clear link between the use of data dashboards and business performance
- Among other benefits, using dashboards can accelerate decision-making and overall digital-transformation projects
- Deciding what goes into a dashboard helps teams agree on what data is most important
The modern enterprise generates vast amounts of data that executives can use to make smarter decisions and improve bottom-line results. But for all this to work, CIOs need tools that can separate the signal from noise and dynamically provide meaningful insights about real-time performance.
Digital-visualization platforms provide a powerful way to do this more effectively and persuasively than previous generations of static charts or graphs. According to a new study from MIT, companies that have the most experience using digital dashboards and visualization tools not only make faster progress with digital transformation projects, but also generate more profit than companies that are less experienced.
MIT’s Center for Information Systems Research surveyed more than 1,300 large enterprise organizations, then correlated their responses with financial results from publicly traded companies within that survey group.
The findings suggest a clear link between an organization’s use of data dashboards and overall business performance. Organizations with advanced “dashboarding” capabilities better empower employees, generate more revenue from innovation projects, offer superior customer experience, and boast higher levels of overall revenue growth.
“Business leaders need a way to figure out whether the business is meeting its KPIs, or whether it’s time to pivot,” says Stephanie Woerner, a research scientist at MIT’s Sloan School of Management and co-author of the report. “If they don’t start thinking about how they capture, visualize, and measure value, they’ll miss the point of their transformation.”
A virtuous feedback loop
Like other digital tools, an advanced dashboard alone doesn’t guarantee positive results. “Just because you put in better dashboards doesn’t mean your earnings will go up,” says Bill Franks, director of the Center for Statistics and Analytical Research at Kennesaw State University and author of Winning the Room, a book about effective data presentation.
Instead, he says, the effort that goes into creating an effective dashboard—agreeing on common metrics, integrating data from previously siloed sources, and using visualizations to tell a more compelling story—makes it more likely an organization will extract value from it. These create a virtuous feedback loop, enabling greater innovation and new revenue streams.
Deciding what goes into a dashboard also forces everyone to agree on what data is important, Woerner says. “Once you can get past arguing about which numbers to believe, you can look at what they’re telling you and ask, what should we do differently?”
Creating successful visualizations also requires consolidating and integrating data from multiple sources and democratizing access to the information, says Stuart Showers, senior vice president of business analytics for Transwestern, a U.S. commercial real estate firm.
Transwestern provides its clients with a data-visualization tool called Curve for managing portfolios of office space. For each building the client owns, the dashboard combines information about lease terms, workforce demographics, HR data, financials, and more.
Clients can drill down into the data to help tenants decide where they should expand or which offices might need to close during a downturn, says Anthony Katsivalis, the company’s national director of client technology. Transwestern also uses Curve to identify sales opportunities and predict which neighborhoods are primed for growth.
The privately held company won’t share specific numbers, but Showers says that using Curve has led to higher close ratios, longer retention, and a closer, more consultative relationship with its customers.
“By creating more data transparency we’re identifying more business sales opportunities for our brokers,” he says. “And that is incredibly valuable.”
The need for speed
Effective data visualizations can also help accelerate decision-making. bioMérieux, a French in-vitro diagnostics company, provides data visualizations for hospitals and other treatment centers with information pulled from a variety of separate systems.
For example, a visualization platform called bioMérieux Clarion, powered by SAS, can be used to create almost real-time antibiograms—charts that show the spread within a hospital or clinic of antibiotic-resistant microbes and suggest more effective treatments.
Where before it might take a specialist weeks to create an antibiogram using spreadsheets and other manual tools, with Clarion the same chart can be created in minutes and be updated with new data dynamically, says Lee Hodge, manager of technical applications and deployment for the company’s Health Information Solutions and Services division.
During the pandemic, bioMérieux began generating COVID-specific dashboards that enabled hospitals to anticipate surges and manage capacity.
“When COVID happened everyone wanted as much data as they could get, and they wanted it right now,” says Hodge. “It really escalated the urgency to make more data available more quickly.”
Tell me a story
Ultimately, digital dashboards are visual storytelling devices that can have far more impact than numbers in a spreadsheet or graphs on a slide. They also allow business leaders to spot issues and respond quickly, before they become problems.
Digital dashboards can create virtuous feedback loops that enable greater innovation and new revenue streams.
At ServiceNow, the publisher of Workflow, an internal CHRO dashboard presents HR leaders with key data in five areas, including talent acquisition and development. “I’m no longer flying blind,” says Paul Davies, a senior vice president for people strategy and delivery at ServiceNow. “I’m able to see the real-time performance of my operations around the world, where we’re performing well against our targets and where my team may need help.”
As enterprises struggle to redefine themselves for the digital era, dashboards that can provide visual, glanceable data detailing a company’s up-to-the-minute performance will be vital to its success, says MIT’s Woerner.
“Transformation is hard, and there are too many places where people can lose their motivation,” Woerner says. “Dashboards allow senior leaders to communicate not just what the company is doing, but why.”