Enterprise Dashboard Digest

Dashboard Spy Topic: Dashboard Blueprint: The 5 Questions Your Dashboard MUST Answer.

This excellent diagram comes from a great article from Quantisense.com titled:

The Retail Business Intelligence Dashboard

According to them, they’ve found that the “best” dashboards have their screen real estate dedicated to answering the following 5 questions:

What’s Going On? (The Operating Summary)
How Do We Stant? (Scorecard)
What Are Our Winners and Losers? (Top and Bottom Performers)
Where Should We Be Working? (Opportunities and Problems)
Where Are We Heading? (Trends)

Here’s an excerpt:

The operating summary: What’s going on?
At the top of the dashboard, in a prominent position, lies the performance summary in the user’s are of responsibility. The metrics here should be tailored to the individual’s preference. Typically, a retail BI user will want to see sales for the week, or week to date, compared to last year and plan. And they’ll want to see gross margin, again against plan and last year. Other metrics relate to the specific role and responsibility of the user. From this point your users will want to drill down to supporting details by store, by product group, by vendor, by customer type, etc.

Scorecard: How do we stand?
Good dashboard design usually includes a scoreboard which puts the operating results in context. The scorecard is a short table in rows and columns that answers the questions: How do I stand in relation to others, to history, and to plan? For example, if the dashboard is designed for district store managers, it will contain information summarizing the district’s performance in comparison to other districts. A buyer dashboard might summarize the buyer’s department along with other buyers in the group.

Scorecards are great to motivate excellence and effort. Within an area of responsibility, report cards are also very useful in showing the relative contribution of the component parts, compared to each other, to history, and to plan. The scorecard for district store managers would summarize stores. The buyer’s report card would summarize vendors. Planners’ dashboard would summarize assortments. Marketers would summarize customers.

Trends: Where are we headed?
Another valuable dashboard view is the display of important measures on a trend graph over time. When combined with solid planning discipline, the graph should not only show recent history but also the plan for the next few weeks. With a good trend graph, the user can quickly drill down to examine supporting elements.

Another good way to show trend, particularly for assortment planners, is to trend the relative contribution of key parts of the merchandise blend. Such a view will show quickly if inventories are balanced well with your shoppers’ demand. For example, if you are selling 60% women’s business wear, but your inventories are 40% women’s business wear, the trend will show if you are closing the gap over the last few weeks.

Top and bottom performers: what are our winners and losers?
A section of a powerful dashboard should be reserved for gaining perspective on your top and bottom performers based on the criteria selected for the user role, and personalized based on individual preference. For example, a planner might want to see the twenty style-colors based on sales volume and check-out percent. Another planner might want to see the top 20%. Another might want the top five.

Bottom performers are a tougher problem in retail. In slow weeks, you don’t want to beset your best people with exhaustive reports with low selling items. Everybody will know sales are slow. In such periods, the report should show the worst of the worst, and ones where early remedy action is possible. For example, bottom performers should be influenced by total inventory value and length of time in the stores.

Opportunities and recurring problems: Where should we be working?
A good dashboard would not be complete without indicators that show how many opportunities and recurring problems have been reported. Each user should be able to customize the type of exceptions that would be reported on the dashboard as well as the specific conditions that would trigger a notification. From here, the user should be able to drill into the detail of the exception so they can take action to improve the business. The latest business intelligence interfaces even allow for pre-defined analytical workflows which guide users step-by-step towards reaching actionable information for solving common retail problems and capitalizing on opportunities.

Business Dashboard Topic: Tracking KPIs and Metrics for Retail Stores

Walking along Fifth Avenue in Manhattan, I noticed through one of the store windows this dashboard. Titled Retail Scorecard, it’s a pen and paper (ok, erasable marker and plastic poster) dashboard used by the retailer to track store performance metrics.

I won’t name the retailer as I’m sure their management would not appreciate the fact that it’s viewable by anyone looking into their window (talk about management transparency!), but it’s a brand name that everyone would recognize.

Retail Store Metrics Scorecard visible from sidewalk

The metrics contained on this scorecard are difficult to make out from this quick snapshot, but they focus on relative sales performance by sales person. Each line indicates a sales representative and the board tracks the number of units of certain items sold.

I couldn’t make out if the Retail Scorecard also contained sales goals.

Seeing this sales dashboard for a retail store reminded me of an article I recently read titled Retailers Counting on Conversion Analysis to Drive Store Metrics.

Did you know that there is HUGE opportunity for retail stores to improve performance simply by measuring and optimizing conversion rates?

Retailers are combating the recession by focusing on conversion rates:

“Knowing your conversion rate lets retailers see how well they are doing, how much the shopper felt the promise of your brand at the door, delivered on the rack, and how much money you might be leaving on the table.”

Some big brands are spending money on this area:

Virgin has credited the analysis with uncovering variations of up to 20% in average transaction values between stores, as well as a 15 point difference in conversion rates between its highest and lowest performing stores. Jason Toy, a division manager for Virgin Retail, said the analysis has been beneficial in highlighting store level performance, as well as regional customer profiles. “From the outset we linked the FootFall information to our store customer service program which has been extremely effective in creating a clear understanding of how service drives conversion,” he said.

Once retailers start collecting the performance analysis from individual stores, they are often surprised by the results. “If you were to ask a retailer how many shoppers they convert, the assumption is typically north of 50%,” said David Smyth, Vice President of sales operations for Experian FootFall. “In reality, the average conversion rate ranges between 20% and 40% for most retailers. Using that average, that means about 70% of shoppers are leaving the store without buying anything. That means retailers are leaving an awful lot of money on the table.”

With major retailers realizing that even a 1% improvement in conversion rates can equate to millions of dollars dropping to the bottom line, more and more are utilizing traffic counting analysis– not only at the headquarters level, but also providing the analysis directly to store managers and other personnel. For example, Marks & Spencer has used its visitor count system to build staffing plans that better match the customer to each department within a store. “By making small, simple, sustainable changes in staffing, product availability and service based on our findings, Marks & Spencer has been able to drive measurable improvements in conversion, units per transaction and basket size,” said Bill Donald, a manager with Marks & Spencer.

Very interesting! Check out the article.

Regards

Hubert Lee
The Dashboard Spy

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