How quickly can you get your hands on relevant data to inform your decision-making?

'Leadership and learning are indispensable to each other.' John F Kennedy

What was true in 1960s America is still true today. Smart business leaders know that a modern business runs on data. More than that, it runs on what you can learn from that data.

Traditionally, the main data source management had at their disposal was a set of backward-looking management accounts, showing the standard profit and loss and balance sheet with limited narrative, keeping score and telling management what had happened.

Leading businesses have invested heavily in recent years in technology and know-how so they can harness the power of data to predict the future, identify opportunities, mitigate risks, and above all, keep the business on track to achieve its strategic goals.

Organisations the world over are swimming in pools of data, but many waste the opportunity to marshal this data into understandable, insightful KPIs, with useful commentary, to make sure that management can measure success and implement corrections where required.

There is a move to dashboarding tools that extract data from various sources and present them in a relevant, easy to understand format for users. When used properly, they are powerful in helping management to identify trends and prioritise actions. If implemented poorly, and above all if they present data that was poor quality in the first place, they can drive the wrong behaviours and have the opposite effect.

Whether you have already moved to a dashboarding tool, or are considering doing so, or you plan to stick with monthly management accounts, here are some tips to make the month end value adding rather than soul destroying.

  • Make sure the underlying data is robust and reliable. Consider an accounting policy review; perform thorough reviews of what is in key accounts; and if using spread sheets make sure they are tested and locked down to avoid unintentional changes.

  • Rather than guessing what your audience wants to see, ask them. Do different user groups have different needs and need different packs? What KPIs does each team use to monitor performance? What do they think of what they receive from the finance team at the moment? Are there schedules in there that nobody uses, but take ages to prepare?

  • What are the top-level strategic objectives of the business? Are they reflected in what you measure?

  • Do you have the right balance between ‘leading’ and ‘lagging’ KPIs? For example, in Sales, a lagging indicator is how many sales you achieved in the last month. A leading indicator would be how many meetings you have booked in with potential customers in the next three months. Combined with your conversion rate, it will help you predict whether you have a sales gap on the horizon, and help you close it.

Regardless of which route you choose, forward-thinking businesses in all sectors understand that putting the right information, in the right format, in the hands of the right people, at the right time, will put them ahead of the pack.

Act today; shape tomorrow.