The "traditional" report has become outdated. It’s not that they don’t serve a purpose or aren’t useful, but technology is now allowing us to take all that would-be reporting data and focus it, give it purpose and turn it into highly consumable Key Performance Indicators (affectionately called KPIs). So what’s so bad about those old-school reports?
We’re all used to reports and we’re comfortable with those familiar multi-paged friends, but they are far from perfect. Have you ever asked for a report, received it and had to search through the data to make sense of what you were looking at? Could you tell right away what action you needed to take? Could you give it to someone else to review without a thesis explaining what they were seeing? Probably not. People ask for reports (they ask for LOTS of reports), but secretly, deep-down in the pit of their stomachs, they hate them because they never quite deliver what they need.
Here’s why KPIs are so much better than reports:
Data data everywhere but not an answer in sightLengthy, all-encompassing reports often have too much data. Much of it is only looked at if something is wrong. I recently asked a roomful of business users the first thing they looked at on a big report. I received a universal “the grand total!” in reply. We often ask for these huge reports because we want to get a full picture of the business. But all too often, this presents a cluttered set of information where we waste time sifting through rows and columns to get something that actually matters to the business right now. Moreover, a single massive report often contains dozens of performance indicators that matter at different times to different audiences. Unlike reports, KPIs help you focus on very specific questions and tell you quickly and concisely only what you need to know.
Too much but not enoughThe second big issue with reports is that most of them present information with no indicator of whether that information is good or bad. If you’re simply looking at huge lists of raw data, how do you put things into context? There might be a comparison to last month or figures in other departments, but should you be above them or below them? How do you know if you’re achieving exactly what the business needs? Great KPIs help you see how you are doing compared to how you should be doing. That comparative gives you quick insight so you know where action is needed.
HiddenI said before that people run massive reports to get the “whole picture” of their business. The truth is that they only really want that when something is wrong (or really going right). They want the ability to research and analyze as needed, but a lack of confidence in the numbers and the length of time it takes to get reports makes them panic and ask for reams of printed results. These reports then bury you in details that are only occasionally important or necessary. Really great KPIs, as an alternative, give you a comparative, at-a-glance view, while allowing you to drill into those details to your heart’s content.
Sometimes a report is exactly what you need. It all just depends on what that person or department is truly looking for. The trick is getting the right tool for the job. As a general rule of thumb, if you have more than 20 cells of data on a report, you are probably skimming it anyway. Stop wasting your time and embrace KPIs instead of reports. If we are all lucky, they might just become the new “traditional” way to see the business. Make sure to watch our webinar to learn more about defining and using KPIs to evolve your business practices beyond traditional reporting.