Using regularly updated dashboards is essential to keep track of your business activity. These deliver valuable indicators on the financial health of your company and also allow you to anticipate and correct any discrepancies.
The management dashboard, also called the budget dashboard, is a medium-term decision-making and management tool. What does a dashboard actually do? How do you implement it within your company? Details.
The dashboard allows you to visualize, follow and exploit relevant data in the form of figures, ratios or graphs, in order to make the right decisions. It facilitates the management of the company as part of a process of constant improvement. More concretely, this instrument is used to monitor actions and results by comparing them with objectives or forecasts, to control personnel and the performance of tasks, to alert on the possible deterioration of certain indicators (commercial, organizational or productive).
The management dashboard thus provides an overview of the company by summarizing the key points of the activity. It has two objectives:to prevent difficulties and to help manage the company.
The choice of indicators taken into account in the dashboard is essential. There are four main types of indicators depending on the activity of the company:
These indicators must be relevant and readable. In addition, their number must be limited so as not to complicate the analysis. Among them, we find for example the amount of turnover, the margin rate, the amount of fixed charges or the degree of customer satisfaction.
Another essential point is the quality of the source data. The data can have several sources:entries in the customer file, entry of quotes and invoices, manual entry of actions or events, internal questionnaires... The relevance and consistency of the source data are essential to obtain an effective dashboard.
Once these indicators have been defined, they must appear in the management dashboard in several rows and columns:the existing (past data), the forecasts (the objectives set over a given time interval), the achievements (the performance actually achieved at the end of the period), the deviations (the difference between the forecasts and the actual results), the justification of the deviations and the corrective actions to be implemented in order to remedy them (example:launch of a communication, reduction of stocks, change of mode of transport…).
As you have understood, the dashboard is an essential tool for managing your business. An accountant or a support organization can help you set it up.
