Project Description

10 KPIs any
CFO-dashboard
should contain

CFO dashboard

The fastest and most efficient way to keep track of your company’s financial performance is via a KPI-dashboard. The optimal dashboard shows the most important figures and updates in real-time so you always have the newest figures.

But which KPIs should CFOs always keep track of? The answer to this differs from company to company. However, there are a number of common KPIs that most CFOs should keep an eye on – regardless of company type or size. Here is our suggestion for 10 essential KPIs you as a CFO should have in your dashboard.

1) The development in your cash flow

Cash flow is a statement of the company’s payments and withdrawals over a certain period – for example payments on long-term loans or payments from a debtor.

A KPI showing the development in your cash flow can function as an indicator of how your company’s liquidity changes.

Cash flow

2) Quick ratio

Your company’s quick ratio is also an important element in your dashboard.

The quick ratio shows the company’s liquid assets after the financial commitments have been deducted.  The quick ratio is a strong indicator of whether the company is capable of purchasing merchandise and paying the bills.

3) Accounts receivable

You should keep a close eye on the accounts receivable owed by customers, suppliers and other stakeholders in order to ensure that the figure does not increase.

If you keep an eye on the accounts receivable, it is easier to initiate corrective measures quickly.

4) Sales, contribution margin and contribution ratio

These might be the company’s most important figures, so a CFO dashboard should always include daily sales, contribution margin and contribution ratio.

You can also benefit from comparing the figures to the monthly budget in order to see the realisation rate.

Fritz Schur Consumer Products

“Personally, I am a big fan of KPI management; i.e. seeing the development in the figures. It is almost like having a radar to steer by. We have gained transparency and a good basis for decision.”
Per Sørensen, CFO, Fritz Schur Consumer Group

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5) Net profit margin

The net profit margin shows how efficient your company is at generating profit compared to its revenue.

Frequently calculated as a percentage, this KPI indicates how much of the company’s earnings translates into profits. This reflects the development of your company’s profitability.

6) Profit and loss statement compared to the budget

Your dashboard should also contain your overall profit budget – preferably with KPIs compared to the budget.

This allows you to see the profit and loss statement for the day, week or month and gain an overview of the revenue for the period compared to the budget.

7) Turnover rate

By optimising the number of days in stock, controlling and monitoring the number of debtor days and by taking advantage of supplier credits, you can improve the company’s liquidity.

Determine a target for the turnover rates and keep an eye on the development via your dashboard.

DHL

“In Denmark, DHL uses InfoSuite in many different business processes, such as operational activities, financial performance measurement and invoice control. InfoSuite allows us to measure important operational KPIs such as delivery volume, load factor, delivery time etc.”
Henrik Hansen, Head of Business IT, DHL Freight

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8) Turnover and profit in proportion to labour costs

Labour costs are often the expense that has the biggest influence on sales and this makes it an interesting figure to analyse in proportion to profit and turnover. It is especially interesting to see how the figure changes over time.

By looking at turnover in proportion to labour costs, you get an indication of the efficiency of the company’s labour costs.

9) Resource utilisation

For some companies, the employees’ time is the most valuable asset for which they bill the customers. This is especially true for service-based businesses.

The resource utilization KPI indicates how efficiently your company uses its resources (time), comparing the billable time with the non-billable time.

10) Customer satisfaction – NPS

Net Promoter Score (NPS) is a simple and efficient measurement of how well you are doing – according to your customers. Based on a recurrent one-question survey among your customers, you get a score indicating how well you are doing.

On a dashboard filled with financial KPIs it is also important to keep track of the development in your NPS-score – After all, what good is a solid financial situation if your customer satisfaction is in free fall?

You are the only one who knows what your optimal dashboard should contain, so it is important that an individual KPI-set be made specifically for your company.

Companies are different and focus on different goals and success criteria. But one thing is true for all financial controllers – an efficient dashboard with the right KPIs will help you make fast and well-founded decision.

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