How to Choose the Right Metrics for Your BI Dashboard

If you are a BI professional, you know how important it is to choose the right metrics for your dashboard. Metrics are the indicators that help you measure the success of your project and guide business decisions. But how do you choose the best metrics among the many available? In this post, we will give you five tips to select the most effective and relevant metrics for your BI dashboard.

1. Limit the number of metrics

More information is not always better. If you fill your dashboard with too many metrics, you might confuse your stakeholders and distract them from the ones that are really crucial for the project's success. Key metrics are those that are relevant and actionable, meaning that they tell you if you are reaching your goals and what you need to do to improve. For example, if metric X goes down, is that a good or bad thing? What action would you take if it went down that would be different if it went up instead? Your goal is not to cover every single use case, but 90% of the most common ones.

2. Align the metrics with the business objectives

To choose the best metrics, you need to understand what are the business objectives that you want to support and measure. For example, if the business objective is to increase customer retention, include churn rate in your dashboard. You will most likely not want to include a metric such as website traffic because that is not directly related to the business objective of increasing customer retention.

3. Check the necessary technologies and processes

Before choosing a metric, make sure that you have the necessary technologies and processes in place to obtain and analyze the data related to that metric. If you can't access the data or if they are not reliable, that metric won't be very useful.

4. Consider the cadence of data

You have to take into account how often the data are available and updated. If many metrics have a different cadence and frequency, it becomes hard to plan a periodic review.

5. Use SMART methodology

SMART methodology is a useful tool for creating effective questions to ask stakeholders. It can also be used to identify and refine key metrics by ensuring that they are specific, measurable, action-oriented, relevant, and time-bound. This can help you avoid vague or too high-level metrics that are not useful to stakeholders, and instead create metrics that are precise and informative.

An integrated view

In the BI world, data requires a dynamic and thoughtful approach to detect and respond to events as they happen. An integrated view of the whole business is required. In some cases, metrics can be straightforward. For example, revenue is fairly clear: Revenue goes up, and things are going well! But other metrics are a bit more complicated.

Let's take an example of a team of online tutors who want to measure their ability to effectively answer students' questions. Every time a student asks for help, a help request is created. These requests are handled by the first response team of tutors. Sometimes the first response team needs help answering more complex requests. They then reach out to the second response team. This is marked as a referral on the help request.

Imagine that the BI professionals working with this team now are trying to decide which metrics are useful in a dashboard designed to increase students' satisfaction ratings for help requests. Perhaps their stakeholders are interested in monitoring referrals to ensure that students are getting the help they need in a timely manner. So the BI team considers adding referral rate, which is the rate at which tutors are asking for help from internal experts, as a metric in their dashboard.

Note that an increasing referral rate could be good or bad. It might mean that tutors are being more student-centric and trying to ensure each student gets the best answer. But it could also mean that tutors are being overwhelmed with questions and having to pass them on to internal experts in order to keep up. Therefore, referral rate is a metric that doesn't have a clear direction; nor does it have an obvious influence on the decision-making process on its own. So, it's not a useful metric for this dashboard. Instead, the BI professionals select metrics that indicate success or failure in a more meaningful way. For instance, they might decide to include a metric that tracks when a tutor experiences missing help documentation. This will help leaders decide whether to create more documentation for tutors to reference. Notice how this metric has a clear line of action that we can take based on how high or low it is!

Conclusion

The ability to choose metrics that inform decision-making and support project success is a key skill for your career as a BI professional. Remember to consider the number of metrics, how they align with your business objectives, the technologies and processes necessary to measure them, and how they adhere to SMART methodology. It's also important to maintain an integrated view of the entire business and how the information your metrics deliver is used to guide stakeholder action.