Framework for Developing a Banking Performance Dashboard: Case Study of TMB Bank

Framework for Developing a Banking Performance Dashboard: Case Study of TMB Bank

Panchana Tantipisut (Waylar Tech Co., Ltd., Bangkok, Thailand) and Pisal Yenradee (Sirindhorn International Institute of Technology, Thammasat University, Pathum Thani, Thailand)
Copyright: © 2020 |Pages: 17
DOI: 10.4018/IJKSS.2020010103

Abstract

This article creates a framework for conceptually designing a performance dashboard for banks. It provides guidelines for developing such a framework for banks and other organizations with similar characteristics. A three-step approach for developing the dashboard is proposed. The first step is to determine the ideal characteristics of an effective performance dashboard using an extensive literature search and expert opinions of TMB bank executives. Second, the current performance reporting system is analyzed using a simplified “Delphi” method to identify discrepancies from the ideal characteristics. Third, some missing elements are identified, and recommendations are provided to enhance the current performance reporting systems, to be an effective performance dashboard. The proposed ideal characteristics and the simplified “Delphi” method are effective to identify missing elements. Moreover, a working team comprised of academicians and bank executives can provide acceptable recommendations to improve the current performance reporting system, to become an effective performance dashboard.
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1. Introduction

Dashboards were initially developed for the automobile industry; however, they have recently been adopted by various organizations and institutions, such as banks. The trend of adoption started with the bank executive’s idea of having an “executive dashboard” that helps them to drive their company. In addition, there is a growing need to squeeze profits by meeting the needs of demanding customers. Therefore, executives reengineer processes, improve quality, and cut costs of their organization, but these are short term efforts, so they propose to use a ‘Performance Dashboard’ which will help them achieve their long term strategic goals in the most effective manner (Eckerson, 2010).

Figure 1.

Methodological steps for development of dashboard

IJKSS.2020010103.f01

In this paper, the authors highlight the necessary characteristics of a banking performance dashboard and suggest a framework for developing it. However, as a bank has to keep up with the competitive and volatile financial market, the bank’s policies have to constantly change. This leads to consistent adjustment of the indicators and development of new indicators to match the new strategies. Therefore, this paper focuses on developing a conceptual design for a banking performance dashboard, instead of a rigid detailed performance dashboard.

This paper is written, based on a project initiated by the Chief Operating Officer (COO) of TMB bank, who has the goal to enhance TMB’s operational excellence. The goal was set by a Dutch multinational banking and financial services corporation, ING group, that holds 25.08% of TMB shares. The initiation of the study led to the cooperation between TMB bank, which is a moderate size bank in Thailand that strives for operational efficiency, and SIIT, which is an academic institution. The results of this project are very beneficial to TMB, and the working team has decided to write a paper to disseminate experience and knowledge, which is expected to be a guideline for developing a performance dashboard for other organizations.

This paper proposes a methodology to develop a banking performance dashboard, as shown in Figure 1. The first step is to determine 6 ideal characteristics of an effective performance dashboard using an extensive literature search and expert opinions of TMB executives. The ideal characteristics are presented in Section 2. Secondly, the current performance reporting system, which is not the dashboard is analyzed using a simplified “Delphi” method to identify discrepancies from the 6 ideal characteristics. The analysis results are shown in Section 3. Thirdly, some missing elements are developed to enhance the current performance reporting system to be an effective performance dashboard, which are presented in Section 4. Finally, the paper is concluded with a summary of contributions, and further research opportunities are recommended in Section 5.

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2. Ideal Characteristics Of Performance Dashboard

In this paper the performance dashboard is a tool that displays the performance of an organization using various indicators, and it breaks the organization’s strategy into objectives, metrics, initiatives, and tasks that are tailored for each unit in the organization. It allows people to monitor, measure, and manage the key activities and processes needed to achieve the goals of the organization. It should have some good characteristics to become an effective performance dashboard. Different from the performance dashboard, a performance reporting system is a simple system designed to report some key performance indicators of the organization. It may not be well designed to achieve the goals of the organization.

After reviewing journals from sources such as Sciencedirect, Scopus and Google Scholar using 5 keywords (Balanced scorecard concept, key performance indicators, key performance indicator alignment, mutually exclusive collectively exhaustive principle, and performance dashboard), and working with the teams of experts from TMB bank, the authors have considered that an ideal performance dashboard should have the following 6 characteristics:

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