PowerPoint Tip - Downside of Dashboards
While this sounds like a good idea, I have two key objections to the way most of these slides are created. First, if you ask a presenter how the color has been calculated, i.e. what constitutes a green, yellow or red, they can't answer your question because they don't know. Someone programmed a set of calculations on a spreadsheet or in some other tool that spits out the color rating for each item based on a complex formula of factors. The presenter simply reports the rating. This does not serve executives well because they need to be able to discuss why an item is rated so that they can make intelligent decisions on it. Sometimes it may be a delay in reporting from another area or system that causes the formula to report a red flag on an item, which causes unneccesary panic in the executive suite and a waste of everyones time searching for and reporting that the item is actually OK, but the reporting was flawed.
The second problem I have with most dashboard implementations is that the scoring system of three colors does not allow enough granularity to give a true measure of a situation. What is the difference between a green and a yellow rating? Probably one tenth of a point on some numerical system used to calculate the colors. Three choices is OK for a stop light where there are only three possible actions, but for organizations, more choices are needed. Even in school we had percentage scales which allowed for up to 100 possible ratings or letter grades, which had 13 possible ratings (A+ to D- and F).
My suggestions for using a stoplight dashboard slide are twofold. First, make sure that the rating calculation is transparent and understood by everyone. Make it easy to investigate why a rating is calculated the way it is so that time wasted chasing phantom problems is reduced. Second, increase the granularity of the rating scale. If you want to stick with the stoplight colors, add a + and - to them to have a total of 9 possible ratings to choose from. These suggestions should improve the clarity of dashboard slides used to present to executives and others.
Executives do prefer visual slides to text slides, and this is one of the items I discuss in my special report on Presenting to Executives. You can get your copy at http://snipurl.com/execs .