Dashboards reporting and visualisation - Design principles a...

Learning Outcomes

This article explains how dashboards and data visualisation improve management reporting for performance management. You will understand key design principles, effective selection of metrics and visuals, and how to craft clear narrative to support decision-making. By the end, you will be able to assess dashboard design, recommend improvements, and identify and avoid common reporting mistakes for ACCA Advanced Performance Management (APM).

ACCA Advanced Performance Management (APM) Syllabus

For ACCA Advanced Performance Management (APM), you are required to understand the use of dashboards and visualisation techniques in performance reporting, including their design principles and how narrative clarity supports managerial decisions. This article covers:

• The purpose and challenges of dashboard reporting in performance management
• Design principles for effective dashboards, including layout, metric selection, and visual elements
• Techniques to achieve narrative clarity and avoid information overload
• Evaluation of common reporting mistakes and best practices in visualisation
• The role of narrative and supporting commentary in reinforcing report objectives and recommending actions

Test Your Knowledge

Attempt these questions before reading this article. If you find some difficult or cannot remember the answers, remember to look more closely at that area during your revision.

1. Which statement best describes the purpose of a management dashboard?
   1. To include as much detailed data as possible in one screen
   2. To present key performance information at a glance for decision-making
   3. To explain only financial data trends
   4. To provide a full database for export to other systems
2. What is the main risk of including excessive metrics or poorly designed visuals in a dashboard report?
   1. Increased accuracy
   2. Improved efficiency
   3. Information overload and reduced usefulness
   4. Better compliance

3. True or false? Narrative explanation in a dashboard report should focus only on positive results, omitting areas of underperformance.

4. List two key features that contribute to narrative clarity in dashboard reporting.

Introduction

Dashboards are now a standard feature in management reporting, allowing rapid review of key performance metrics and enabling timely action. However, designing dashboards that truly add value requires more than assembling data and charts—clear layout, careful metric selection, and well-structured narrative are all critical.

This article covers design principles for effective dashboards and visualisations, with a focus on clarity, relevance, and practical support for management decisions. It explains how to avoid common reporting pitfalls such as information overload and ambiguous visuals, and underlines the importance of concise narrative in supporting and interpreting the data shown.

Key Term: Dashboard
A visual reporting tool displaying key metrics and trends, typically on a single screen, to support performance monitoring and decision-making.

THE ROLE OF DASHBOARDS IN PERFORMANCE MANAGEMENT

Purpose and Benefits

Well-designed dashboards summarise the most important performance information. They offer:

• Snapshot views of priority metrics
• Comparisons to targets and prior periods
• Early warnings of issues needing action
• A platform for action-oriented commentary

Key Term: Data Visualisation
The presentation of data using charts, graphs, or other visual tools to communicate key messages efficiently.

Common Pitfalls

Dashboards can fail if overloaded with detail, use unsuitable visuals, or lack supporting explanations. This can result in confusion, misinterpretation, or inaction.

DESIGN PRINCIPLES FOR EFFECTIVE DASHBOARDS

Concise and Relevant Metric Selection

Dashboards must focus only on critical success factors (CSFs) and key performance indicators (KPIs). Resist the temptation to include all available data.

Key Term: Critical Success Factor (CSF)
An area where satisfactory performance is essential for the organisation to achieve its objectives.

Key Term: Key Performance Indicator (KPI)
A specific, measurable value used to track progress toward a CSF.

Visual Clarity and Layout

Keep the design simple:

• Group related metrics logically
• Place most important visuals top or left for quick scanning
• Use clear, consistent labelling, including units and timeframes
• Avoid unnecessary colours, 3D effects, or complex graphics
• Integrate only those visuals that add meaning (e.g. sparklines for trends, gauges for targets)

Avoiding Information Overload

Too many metrics or crowded visuals decrease value. Always prioritise:

• Essential over nice-to-know information
• Current period, with reference to target or benchmark
• Clear highlighting of exceptions and outliers

Using Narrative to Support Decision-Making

Accompany dashboard visuals with brief, focused narrative that:

• Interprets main findings and trends
• Explains causes of variances
• Highlights actions required and recommendations
• Summarises key risks or uncertainties affecting interpretation

Key Term: Narrative Clarity
The use of concise, relevant commentary alongside data, aimed at aiding understanding and prompting action.

Worked Example 1.1

A division manager receives a dashboard showing month-on-month sales, customer returns, stock levels, and production hours—22 metrics displayed in total, many with multi-colour bar charts and pie charts. The only commentary reads: "See metrics below for detailed information."

Question: Identify the main shortcomings of this dashboard and suggest three improvements.

Answer:
Shortcomings include: (1) information overload (too many metrics shown at once), (2) unclear visuals (use of many colours and nonstandard charts), and (3) insufficient narrative (no explanation of context, trends, or required actions). Improvements would be: (i) restrict metrics to key CSFs and KPIs only (e.g. top five), (ii) select more appropriate, consistent visuals with clear labels, and (iii) add concise commentary summarising performance, causes of any variance, and suggested management actions.

Worked Example 1.2

A dashboard in an environmental report uses green and red traffic-light symbols for waste reduction targets. The accompanying text states: "Waste metrics available. See attached data for details."

Question: Is this approach sufficient for management reporting? Why or why not?

Answer:
No. While colour indicators provide a quick sense of status, the lack of targeted narrative means users do not know why targets were missed or what action is recommended. Reports should provide a short explanation of causes and clear, actionable recommendations for management.

Exam Warning

In APM, exam questions often present dashboards or extracts from management reports with design flaws or missing commentary. You may be asked to evaluate the report, identify weaknesses, and make specific improvement recommendations. Always comment on layout, selection of metrics, clarity of visuals and narrative adequacy.

Revision Tip

As you practice, sketch a dashboard for a given scenario using no more than five KPIs. Then, write a 2-3 line commentary interpreting the results and suggesting one management action.

SUMMARY

Dashboards and data visualisations are effective tools in performance management—when designed using clear principles. Focus on simplicity, relevance, and narrative clarity. Only display priority metrics, use straightforward visuals, and write concise commentary to guide management actions. Avoid data overload and ambiguous graphics. Always keep the user, purpose, and decision context in mind.

Key Point Checklist

This article has covered the following key knowledge points:

• Define dashboards and data visualisation in performance management
• Explain key design principles for dashboard layout and visual clarity
• Identify causes and effects of information overload in reporting
• Describe best practices for selecting and structuring dashboard metrics
• Outline how narrative clarity supports accurate interpretation and decision-making
• Recognise common reporting errors and recommend effective improvements

Key Terms and Concepts

• Dashboard
• Data Visualisation
• Critical Success Factor (CSF)
• Key Performance Indicator (KPI)
• Narrative Clarity