Excel Dashboards for Performance Management Reporting

Excel dashboard tips for performance management: What you need to know before you create your excel dashboards!

Performance management is the key to business success. Because of this, managers need to master the art of performance management. This includes understanding performance for your business and measuring performance on a continuous basis.

While organizations typically use this management discipline to manage performance, they are not fully satisfied with the way they can actually define, manage and reward performance of their companies, departments, teams and individuals (read about the three levels of performance management).

Think about sales performance for example – while businesses can claim that they use performance based pay, incentives and rewards for their sales people, at the same time they will tell you that their performance management is not perfect. The same holds true for any department and business function within your organization. Fact is that more than 3 quarters of CEOs are not happy with their performance management.

What is the reason behind this? One of the setbacks in developing your effective performance measurement system is the non-financial metrics, measures or KPIs. Think about the sales reps again – it is easy to set financial goals and develop reward system but not so much the non-financial metrics. You might think it is all about profitability and financial results so I don’t see anything wrong with that, however here is the catch: the non-financial measures are as important because they drive the behavior of your sales reps or any other employees. The non-financial metrics will influence how your employees spend their time, plan their efforts, where they focus and ultimately all these pieces will drive the financial results.

Another important reason is the pace of change within your organization and market. Things change and in business they are supposed to change in order for you to stay competitive. Best practices and benchmarks change as well which is the backbone of performance measurements systems. What worked last year may not work as effectively this year. As a result your performance measurement system needs to evolve over time and adjusts. Typically small changes over time will keep your management system in shape – being efficient and effective which will drive your competitiveness and profitability (read about financial ratios reporting).

Fill-in-the blank Excel KPI templates, dashboards, scorecards:

Many excel dashboard users will give up their performance dashboards, metrics and KPIs over time because they lose the enthusiasm they had when they first started. One of the causes of this behavior is that their excel dashboard was never really aligned with their business strategy and tactics. The strategy needs to drive your choice of key performance indicators on your excel dashboards, while tactics must drive the rest of the metrics.

Excel reports, scorecards and dashboards templates are excellent tools for performance reporting however your success will largely depend on what you measure. What you measure is what you get. This goes back to the legendary management guru Peter Drucker and management by objectives. Management system can only be effective and successful if it is aligned with the objectives of the business.

The real benefit of the balanced scorecard for examples is based on the strength of using non-financial measures in addition to the typical financial metrics. Financial ratios reporting and measurement is only effective if you are able to manage the causes of those financial results. If you are not able to define and measure the right non financial KPIs, your financial dashboard will be just a good to know historical information and stats – nothing more. This is not much useful to any manager and business organization.

As a manager before you create your dashboard in excel you need to work on defining your KPIs and metrics on a global organization wide level as well as department, team and individual level. In addition you need to define your financial KPIs and metrics as well as the non financial like sales, marketing, HR, production, operational, process based metrics, etc.

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