Scoro’s Guide to KPI Tracking
No matter what sector your business operates in, setting up the appropriate KPIs is essential when establishing the early stages of a project. KPIs are measurable metrics that translate complex measures into simple indicators of business performance. A well-framed KPI helps managers to navigate essential business processes, showing whether an organization is achieving its key objectives, and lets them make data-driven decisions to address these issues.
We’ve already given you an overview of which business metrics to measure – determining these will usually depend on your budget, industry, and the nature of the project in question. However, the process of actually doing this, and working out how to present these findings to your internal and external stakeholders, is just as important.
Here, we’ll take you through the basics of KPI tracking and reporting, and give you the essentials on how to create a KPI dashboard.
What Is a KPI Report?
To begin with, we should differentiate between the two main terms we’re discussing here – KPI reports and KPI dashboards.
A KPI report is concerned with the analysis of data, while dashboards are more commonly used to provide an easily-digested visual representation of this data.
That said, a well-defined KPI report should still be visually attractive, as well as informative, and actionable, giving business leaders insight into their company’s performance and helping make informed decisions.
Setting up and using KPI reports offers a wealth of benefits to any company, including:
- Accessing important data in a few clicks
- The ability to automate real-time updates to get the latest information
- Gaining a quick overview of the company’s budget
- Tracking project & sales performance
- Beautifully visualized data, presented in an easily understood way
- Data-driven, actionable metrics to help you make the right decisions
Setting Up Your First KPI Reports
How you compile your initial KPI reports will depend on which metrics your business is aiming to track. Some of these may even be so large in scope that you might have to create multiple real-time dashboards to evaluate the performance of several business processes.
You could start with an executive dashboard, then create dashboards for monitoring financial and sales performance, as well as internal processes. However, the best way to determine which metrics to track in the first place, consider the following questions.
1. What are your desired business outcomes?
Think about your company’s long-term goals and consider the steps you need to take to achieve those objectives most effectively. For example, if you’re looking to increase profit, are you going to do it by increasing your customer base, selling more products each month, or cutting production costs?
From there, you should evaluate how close you are to achieving these goals, and set feasible objectives which can be complemented with measurable and actionable KPIs.
2. Do you have access to the relevant data?
No matter how many actionable metrics you come up with, they can’t be compiled into a KPI report unless the program you’re using has access to the relevant information. If you’re not yet collecting all of this, find a tool that enables you to do so – Scoro, for example, gives businesses access to all of the KPI reporting data they need in real time.
3. Are the KPIs you’ve chosen actionable?
Suppose you created a metric to show how many new customers you acquire month-to-month. If the KPI on your dashboard shows that this number has dropped. What’s your next step to improve the situation? Do you have a clear action plan? Is this a number you can impact?
For example, if your goal is to increase your profits by selling more products each month, you could measure:
- Average shopper value (you should try to reach buyers that make bigger orders)
- Average size of an order (by offering discount you can increase sales)
- Average profit earned from each sale (maybe you need to raise the prices).
As you can see, these KPI metrics are all measurable and actionable, which means that it’s in your power to change the results and improve the sales performance.
4. How do you want to visualize the KPIs?
Think about each KPI individually and consider multiple ways of presenting them. Are you going to use pie charts, tables, bar charts, line charts, or number metrics to visualize a metric? When creating a KPI dashboard, place similar metrics close to each other, creating a natural flow of information. This way, you’ll find all relevant data quickly.
5. Who is going to have access to the KPI report?
When creating a KPI tracking report, you should always consider who will see and use the data. Think about who will benefit from the information and who will be responsible for the outcome – as well as who will need to be granted permission to see all the data reflected by those KPIs.
You should determine the solution to these issues as follows – if you came up with an interesting KPI, but there’s nobody to monitor it, there’s no use in adding it to your dashboard. Always ensure that every KPI metric has someone responsible for the results.
What Is a KPI Dashboard?
The performance of a business will be affected in all manner of ways – big or small – by hundreds of different activities and processes which can’t always be predicted.
In these instances, being able to oversee each of these moving parts in real time can be hugely beneficial to your business’s day-to-day operations.
A KPI dashboard collects, groups, organizes, and visualizes a company’s important metrics, providing a quick overview of business performance and expected growth.
By concisely laying out all of this information in a single dashboard, organizations can access their success indicators in real-time and make informed decisions that bring them closer to achieving long-term goals.
How to Create a KPI Dashboard
KPI dashboards for businesses can be created with specific software that automatically collects and updates data in real time. If you want a well-performing and actionable KPI dashboard, you can’t simply rely on Excel spreadsheets to get the job done. Experiment with software gives you the opportunity to bookmark your most important metrics and exhibit them on multiple dashboards.
An informative business dashboard is defined by well-chosen metrics. Before you start creating a KPI tracking dashboard, it is necessary to have a clear vision of your goals and requirements.
Before creating a business dashboard, you need to determine:
1. What is the purpose of your dashboard?
In this phase, you will need to figure out what performance indicators will be added to your dashboard. What are the goals that you want to achieve and which problems are you trying to notice with the help of KPIs on the dashboard?
2. Are your KPIs actionable?
Only monitor key performance indicators that can be acted upon. You should link each KPI with a clear goal, and only concentrate on the processes that will have a direct impact on that metric. Avoid adding vanity metrics that aren’t relevant to achieving your business goals.
3. Who is your dashboard for?
Keep the audience of your dashboard in mind, and consider how frequently will they check it? What data will be important to those people, and have you made sure to lay out your information through the type of visualizations that they would prefer?
4. What types of charts should you use?
There are multiple chart types that look great on a KPI dashboard, each suitable for a different type of metric: pie charts, tables, bar charts, line charts. Define the metrics you want to visualize and find the best chart type for the data you want to report on.
Once you have answered these questions, it’s time to start compiling your first KPI dashboard. Place closely related metrics next to each other, creating a linear flow that’s easy to follow. Use colors to bring life to your performance dashboard, and add benchmarks to make the data easy to evaluate.
By now, you should have a brief overview of the purpose and possibilities of a KPI tracking dashboard. By creating multiple dashboards with relevant information, companies can start to benefit from comprehensive and actionable reporting.
Remember to frequently check whether all the metrics on your dashboards are still relevant and if the data is updated in real-time.
Benefits of KPI Dashboards
The greatest value that a KPI dashboard has for businesses lies in its ability to provide real-time information about a company’s performance.
As a result, business leaders and project teams can make informed and goal-oriented decisions, acting on actual data instead of a gut feeling.
Moreover, a timely, well-framed KPI dashboard can help individuals instantly notice problem areas and tackle the problems accordingly. Managers who use KPI dashboards on a daily basis for getting a quick overview will then know where to focus their energy, and identify where there is room to improve any poorly performing process.
The KPIs on a dashboard can be chosen and organized according to each user’s needs.
KPI Dashboards for CEOs
A CEO KPI dashboard can provide an organization’s C suite with an at-a-glance holistic overview of performance and profitability. As these dashboards contain a lot of sensitive data, they tend to only be used by the company’s CEO and high-level executives. Moreover, these executive dashboards are often used to keep track of whether the business reaches its goals and where its problem areas lie.
The KPIs on the CEO dashboard include:
- Company’s monthly revenue
- Net income
- Revenue growth
- Departments’ performance
- Quarterly goals
- ROI of large business deals
- Comparison with competitors
A CEO dashboard is very similar to a company-wide dashboard, as both include KPIs that reflect on the company’s well-being. Corporate KPI dashboards can be used at management meetings for a quick overview of business performance.
KPI Dashboards for Project Management
Project tracking dashboards provide a quick overview of how a project is doing, and reflect on the performance of the individuals working on it. They can be an especially useful asset for keeping everyone aware of the latest achievements and landmarks. Project managers can use their dashboard to notice shortcomings in reaching their goals and keep their eye on the project budget.
The KPIs on a project dashboard include planned budget, time spent on specific tasks, ROI of projects and tasks, team members’ performance, activities completed, and time left until the end of the project.
KPI Dashboards for Sales
From new leads to the value of deals, a sales tracking dashboard can give businesses a complete visual overview of their sales performance. Managers can instantly see which salespeople perform the best, and how much income can be expected from any new deals. Moreover, a comprehensive dashboard can help teams get a sense of when sales are beginning to slow down, allowing them to respond accordingly with a timely marketing campaign, or incentivizing staff.
The KPIs on the sales dashboard include the number of new customers and leads, churn rate, the value of new deals, revenue goals, comparison to previous periods, and salespeople’s performance.
You can also use your dashboard for benchmarking, setting concrete dates and numeric values to give you a clear sense of how close your team is to reach its sales target. KPI dashboards can also allow you to add deadlines for projects and tasks that you wish to finish on time and to set reminders to take action when the time’s running short.
Marketing KPI Dashboard
The marketing dashboard can display your digital marketing metrics. such as the number of monthly new leads (distributed by the lead source, countries, etc.), the budgets spent on various marketing channels, and the performance of email campaigns. A well-defined marketing dashboard gives an instant overview of the marketing team’s performance.
Other metrics to include on a marketing dashboard include cost-per-lead, cost-per-customer, lead-to-customer conversion rate, SEO metrics, website traffic, and much more.
Create a KPI Performance Dashboard With Scoro
If you’re looking for end-to-end software which can give you the opportunity to create comprehensive KPI reports and visually appealing KPI dashboards, look no further than Scoro. What’s more, our project management software not only helps you track your KPIs, but aids with communication within your organization, no matter what industry you work in.
Sign up for a free 14-day trial today to see how much of an improvement Scoro can offer your KPIs.