Don’t Walk, Run Away from Templated KPI Dashboards
If you’re looking for a quick, one-size-fits-all solution to track your company’s performance, you won’t find it here. At West Elk Partners, we believe in creating customized KPI Dashboards that reflect the unique business needs of each company. Forget pre-made templates—success comes from a tailored approach that involves close collaboration with your leadership team.
Why Traditional KPI Dashboards Often Fail
Let’s start with a few points on what a KPI Dashboard shouldn’t be:
NOT Just a Monthly Task: Waiting for end-of-month data (with a 5-15 day lag) is too slow. Real-time or weekly updates help make quick, effective decisions.
NOT All About Financials: Financial metrics reflect past performance. Focus on what’s driving those results, like customer engagement, satisfaction or sales activity.
NOT a Metric Dump: Choose 5-8 key metrics that truly represent each business’s health. Too many metrics can dilute focus and hinder decision-making.
NOT for Compensation: Incentivizing the wrong behaviors can steer a company off course. Use KPIs to inform decisions, not drive paychecks.
Start with Strategy
The underpinnings of an effective KPI Dashboard start and end with strategy. If a company is a ship and the CEO is the captain, KPIs are the GPS system. The captain first establishes a destination to navigate the vessel (strategy), and the sales and operations functions power and move the team towards the destination. The GPS system allows course corrections and adjustments as new facts arise. Without it, you’re lost at sea.
The most successful management teams align their organization’s mission/vision/values, long-term goals, target market, and the team to achieve the vision. For further insight, the book Traction, by Gino Wickman provides an actionable framework under the Entrepreneurial Operating System (EOS).
Results vs. Indicators
Monthly financial results tell us what happened, but they don’t guide future action. Instead, focus on indicators like customer complaints or upcoming sales meetings to predict and influence future results. Think of financial results as looking in the rearview mirror, while indicators are the headlights—showing a team what’s coming so they can adjust course before problems arise.
Lagging vs. Leading Indicators
Use a mix of both to get a complete picture of a business’s health:
Lagging Indicators show past performance, like customer retention or sales completed. They’re essential, but only tell you where you’ve been.
Leading Indicators predict future performance, such as new leads generated or employee training hours. They give you a heads-up about where you’re heading and what needs attention.
Streamline Data Systems
The holy grail of KPI tracking is to have all data seamlessly flow into one database, reducing manual input and allowing operating teams to focus on what they do best. Tools like data warehouses and data lakes provide an aggregation point for operating information from various sources (ERP, CRM, WMS), providing a comprehensive view of performance in real-time.
A Final Word from West Elk
West Elk believes in the power of data and informed decision making; however, we believe most strongly in the power of people. In our post-acquisition efforts, we empower leadership teams with tools to create effective data systems, which lead to better decision-making. Our passion is supporting effective strategic planning, system transformations and empowering teams, in a collaborative environment, to align on the appropriate strategies and tactics to achieve the vision.
Illustrative Example
We’ll walk through a simplified example to show how strategy connects to value drivers and KPIs, making these concepts more helpful.
Background: Our example uses a natural food manufacturer whose sales are primarily through retail grocery channels. The company has had strong success in Target and Whole Foods in the Mountain West regions through established distribution relationships.
Leadership Strategy: The company’s leadership team knows they are the #5 U.S. natural brand in their segment and has a goal to become the #2 natural brand over the next three years. To achieve this, the company must commercialize two new products and redesign its marketing and promotional program. Further, to build national store count, leadership targets two new distribution relationships in the Midwest and East Shoreline.
With some general background in place, we break out the mathematical components of revenue (ideally 4-6) for our natural food manufacturer.
Number of Commercialized Products Offered
Number of Customer Locations (through distribution channels)
Open Orders
% Active Orders Fulfilled
We can then identify underlying value drivers beneath each category to begin getting into the true drivers of value.
KPI Development: Looking into our Revenue Formula above, the leadership team brainstorms KPIs associated with each value driver.
Number of Commercialized Products: For the company, the maintenance of current product lines and commercialization of two new products is a gating item to achieve leadership’s long-term goals. Some indicators in this area could include:
Product Development Milestones Scheduled Next Month (Leading)
Product Development Test Group Events Scheduled Next Month (Leading)
Current Customer Locations: In leadership’s strategy, new distribution relationships are key to growing store count:
Distributor Samples Sent (Lagging)
New Distributor Meetings Scheduled (Leading)
Orders Received (Current Customers): The company must maintain and grow shelf space within its current locations:
Number of Stores with Weekly Sales Declines (Lagging)
Customer Complaints Logged Last Week (Lagging)
Social Media Impressions Last Week (Lagging)
Ongoing Customer Survey Results (Lagging)
Planned In-Store Events Next Week (Leading)
Planned Promotions by Location Next Week (Leading)
% Open Orders Processed: In food manufacturing, a major value driver is derived from the manufacturing floor and quality control around finished goods from the manufacturing line. Measurable drivers could include:
Average First Pass Yield (Lagging)
Average Dock to Stock Cycle Time (Lagging)
On Time in Full Shipping Percentage (OTIF; Lagging)
Food Safety Tickets Logged (Lagging)
Planned Production Volume Next Month (Leading)
Long Dated Inventory (Leading)
This list can be distilled into core 5-8 KPI metrics for ongoing tracking in a weekly dashboard for executive review. These metrics work well in a trend analysis, allowing you to review patterns over time.
Additional Reading
Traction: Get A Grip On Your Business, Gino Wickman
Levers: The Framework for Building Repeatability into Your Business, Amos Schwartzfarb, Trevor Boehm