Michael Weilant, FSA, MAAA,

Transcription

1 How to drive in the fast lane: Management Dashboards Actuaries Club of the Southwest AUSTIN 2009 Jean-Marc Fix, FSA, MAAA VP, Research & Development Optimum Re Insurance Acknowledgement Thanks to Michael Weilant, FSA, MAAA, Milliman who suggested the topic for another seminar and his help on that presentation, especially regarding the survey. 1

2 Dashboard Purpose Terminology Outline Pros, cons and survey feedback Metrics Case study Definition A dashboard is a visual display of the most important information needed to achieve one or more objectives; consolidated and arranged on a single screen so the information can be monitored at a glance. Stephen Few IntelligentEnterprise.com 2

3 Purpose Visualize live the measures needed in order to achieve your objectives Dashboard Example #1 Source: 3

4 Dashboard Example #2 Source: Dashboard Lingo Gauge Bullet graph Sparkline 4

5 Bullet Graph GOOD MEDIUM POOR ACTUAL TARGET Sparkline small, high resolution graphics embedded in a context of words, numbers images (1) and a fetch msg?msg_id=0001or&topic_id=1 (1) Beautiful Evidence by Edward Tufte 5

6 Sparkline Good Bad Dashboard-Pros Discipline Format that gives insight Ability to drill down Real time 6

7 Dashboard Pros - Comments Quick reference of how the different parts of the company are doing Watch key indicators at a glance and in the same format each month Keeps senior management informed, creates competition among business units, lets employees know how products impact their incentive comp Dashboard-Pros (cont.) Focuses management s attention on results Gives sales people, underwriters and product managers information on sales trends, risk results, and performance metrics that may highlight g issues or trends that need to be managed 7

8 Dashboard-Cons Caught up in the minutia Distracting trendy look Form over function Explain the new tool to Corporate Dashboard - Cons - Comments Not much detail. Use stop lights Selecting a color is judgmental Additional work and expense to maintain displays Dashboards can be too superficial and Dashboards can be too superficial and provide false confidence and/or misleading reads on how the business is doing. Thus, our monthly reporting packages are much more dense than a dashboard 8

9 Dashboard-Cons 2 Can be confusing if not kept simple and if numbers do not match other reports Very short term view of the product Information is summarized so need to be able to highlight messages and dig deeper into the data Dashboard-Connudrum So much data, so little space 9

10 Two choices: Metrics Production orientation Modeling orientation Must allow alignment to corporate goals Metrics Input Process Output UNDERWRITING LAPSES SALES CLAIMS PROFIT ISSUE COMMISSIONS 10

11 Metrics 2 Product Line Corporation SALES UNDERWRITING ISSUE LAPSES CLAIMS EXPENSES PRODUCT MODEL LINE MODEL CORPORATE MODEL Designing a Dashboard: Case Study What objective(s)? What metrics? What tool? 11

12 Designing a Dashboard: Case Study Objective: measure health of Critical Illness Insurance block Focus on production Assess profitability as variance from plan targets Comprehensive view Designing a Dashboard: Case Study Show what can be done, not necessarily what to do (more styles than needed) Only limited interaction 12

13 What Tool? Done in Excel (2003) Should be much easier in Excel parklines-in-excel.aspx Pros: Available Cheap What Tool? Excel Many corporate reports are Excel based already Cons: Not a very dynamic or in look Some tricky points Pro or Con: Can fit a lot of data in a small area 13

14 Illustrative Dashboard Caveat More styles than needed (to show what s possible) Data is for illustrative purposes only (i.e. fake) except for claims which are indeed mostly representative of our claims experience on CI business 14

15 Demo Sample analysis Navigate the reports Look for odd patterns and correlations Dig down Investigate suspicious patterns 15

16 Post Mortem MAJOR undertaking Learn the lingo and teach the lingo Design with your audience in mind and validate Show less but give the ability to dig Build with comparison in mind Post Mortem 2 Compatible with your current management measures Need targets for all measurealigned with you profit goals Getting the right base data Timeliness 16

17 Dashboard-Pointers Be flexible about what is on the dashboard. The items should be changed periodically to keep the dashboard relevant Select the correct key indicators. Maintain data over long periods of time to observe trends. Focus on the underlying business operations or customer behavior that drives the indicators, not on the indicators or the data display themselves Make sure that your IT can provide the data needed for your dashboard Dashboard-Pointers Focus only on the key metrics less is more. The detail is important for a select few number of people but a dashboard should be a summary of the KEY levers/drivers of the business To the degree possible, use quantifiable measurements, not subjective measurements Test the design of your dashboard with the Test the design of your dashboard with the audience before you implement to make sure it will have what is needed 17

18 A well designed dashboard will be a source of insight and give you the ability to act fast Final words A poorly designed dashboard will be a source of endless headaches Questions? 18

19 Trademark of Optimum Group Inc