Dashboard: Rear-view mirror or Heads Up Display?

Chris Carren who hails from Business Objects and is now general manager of Microsoft's Office Business Applications division (interesting in its own right) released an interview yesterday concerning Microsoft PerformancePoint. He says:

There's also been a huge evolution in how customers want to think about business intelligence. They are showing an eagerness to move away from the traditional methods of sharing information, like sending reports out via e-mail that capture what transpired the previous quarter or reporting period. Instead, they want a metric-centric view via a Web-based scorecard or dashboard that focuses more on what's happening now, and even more importantly, what likely will happen next week or next month.

That last sentence is interesting. Although predictive analytics firms have been around for years, they have achieved little penetration into the mainstream market. Witness Cognos's acquistion of a product "Forethought" about 7 or 8 years ago that was promptly buried.

Today, I think Chris is right on the money due to a few key shifts in the market.

1. The demand for forecasting and enterprise planning solutions has picked up in recent years, as people try to move off spreadsheets and into something more integrated, accurate and controllable. Sarbanes-Oxley contributes to this among other things.
2. Increased focus on data-based decision making. While many organizations do still struggle to get accurate data, a substantial number now have this under control and business intelligence is part of their management process.
3. The "Competing on Analytics" trend is just beginning to take off. Companies are starting to realize the power of statistical analysis, experimental design and forecasting to improve their business results.

As the "quants" get involved, SAS and SPSS get a big push. But amateur quants also need tools - hence Excel 2007 SP2 in which users can run the data mining features of SQL Server Analysis Services 2005 from their desktops.

I first heard the phrase "driving by looking in the rear-view mirror" in one of the early Balanced Scorecard books. Kaplan and Norton used this as an analogy for managing your business by looking at past financial results only. They encouraged organizations to seek "leading indicators" that would drive future financial results.

Still, scorecards and dashboards typically only display the past, even if they include leading indicators. What Chris is talking about (and Thomas Davenport for that matter), is using the past to statistically predict the future, and display that on the dashboard.

I'm not sure dashboard is quite the right image for this trend. Instead, I think about the heads-up display. Managers are razor focused on the airspace ahead, with analytical and predictive information thrown up on the windscreen. A warning light indicates something bad might happen. A predictive chart validates whether the executive intuition matches historical projections. All in real-time with reaction times down to the hair trigger.

Compare that picture to the stodgy data warehouse and BI departments and vendors that litter our corporate battle field...


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