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Don't Drown in Data (or Drive Your Car by Staring at Your Dashboard)

Tuesday, May 19, 2015

Do you drive your car while staring at the speedometer? What about the fuel gauge?

As for me, I don’t think that I look at the fuel gauge until the fuel alert tells me to do so. Moreover, there are thousands of other processes and potential mechanical changes that simply roll up to a “check engine” light, and I have to go to an expert to tell me which error code is being triggered.  

This is a great analogy of how we use information to drive a day-to-day business. You can't fixate on reports and dashboards, and you don’t necessarily need to know all the processes and metrics that go into the successful act of driving a car. You do, however, want an alert system that tells you when to look deeper and what to look at as a causation for a change in your ability to drive towards a goal.

Organizations need to drive a successful process of identifying Key Business Requirements, as well as the Key Drivers of that success.

Most company owners simply want to know, ‘how do we maximize revenue and minimize costs, while growing as quickly as possible?’ The people who report to the ownership typically want to know how the particular department or function they lead is a component of how that company makes money.

Next, once those core KBRs and Business Drivers are determined, it's time to establish what insights and alerts need to be set up in order to drive the success of that function of the business.

There could be literally dozens or hundreds of these insights. Even the person ultimately responsible for them doesn't need to look at them every day. Instead, these insights should have a way to be flagged when one of those key metrics moves outside of the target. In other words, there's no use in staring at the fuel gauge for the first hour after you fill up the tank.

So, your challenge is to think of the best way to set up a standing-reporting dashboard, built in a top-down manner, that gives the most key insights into the health of the business. Then, brainstorm which insights drive towards those KBRs, and create a way to monitor those insights and be alerted when they change.

There are many tools out there for this, but at Big Squid we've been seeing a lot of success using Domo to tackle this challenge.

What's interesting about that solution is that while we're using it in many cases for digital marketing goals, Domo is applicable to the effective and efficient monitoring of any function of any business.

So don’t become overwhelmed by data. Instead, build a manageable means of understanding your business performance, and whether or not you are reaching your targets.

Chris Knoch

Written by Chris Knoch

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