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"Risk Dashboards should serve the stakeholder" | Advanced Risk Dashboards

Monday, March 25, 2013

Risk Dashboards

A recent debate between risk analysts on how to report risk resulted in several suggestions but the discussion was reduced to comparing one chart type with another. This is all fine and I threw in a recommendation for the 3 in 1 polar plot [LINK] but risk reporting surely has to be greater than this.

Reporting risk really needs to be more holistic and it should take in a wider perspective of alternate measures of uncertainty found in a firm. Risk Dashboards achieve this end and we'll take a look at a couple of them in this blog.    

One of the biggest failings of a good risk model is the inability to present results to management in a timely fashion so that they can make informed decisions. The risk dashboard generally solves this problem.

Sample Dashboard 1 | Datazen  [click image to enlarge] 

Reporting risk metrics alone is also problematic because it drives management to focus on only negative outcomes and the largest of them, rather than balancing risk and return.  A dashboard theoretically allows risk results to be presented alongside other measures of performance such as revenue and operating margin.

This positional tracking of multiple variables of uncertainty is ideal for showing risk adjusted return on capital and dashboards can even paint a picture of risk on a map.

Sample Dashboard 2 | Datazen  [click image to enlarge]

A well structured dashboard should summarise and aggregate risks across a business but also allow a manager to click on specific report objects so that they can dive into additional details underneath the results.

Sample Dashboard 3 | Datazen   [click image to enlarge]

Now this all looks really top notch, superb and you would probably perceive that the dashboard samples we have shown here are difficult to build.  The good news is that they can be developed in a matter of minutes, assuming the risk analyst has a clear vision for how they want to represent risk to different teams in their company.

The next piece of good news is that not only can these dashboards be built without programming knowledge, tools such as those offered by Datazen are free to use.  Yes, all you have to do is load categorised and positional data from a spreadsheet into the Datazen dashboard builder, select your chart types and it will do the rest for you.

Building dashboards couldn't be easier and more information on the Datazen dashboard builder can be found by following this LINK.

4 comments:

  1. Thanks, Martin, that's fantastic and greatly appreciated.

    FYI, I've put the link on my Linkedin page so that more people can see/read/digest it.

    Best wishes and kind regards,
    Markus
    ________________________
    krebsz.net
    www.riskguide.net

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  2. nice dashboards. as a developer. i really appreciate the effort put in. But i prefer white/bright theme instead of dark - kinda gives a look that computer gamers like and not a business minded one.

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  3. Thanks, Martin, will try to use your thoughts in the real world...

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  4. Martin, thanks for the link. One thing I try to ensure in my dashboards is only putting in KRI's that reflect the strategic objectives or either the company if it is for corporate review or the project's strategic objective if for a project. All to often I see a let of metrics that don't reflect the Key Risk Indicators.

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