A Picture is Worth a Thousand Words | Data Visualization
With the proliferation of big data, utilizing data visualizations to quickly and effectively convey concepts is critical to identifying patterns and making better business decisions. The charts, graphs, and pictures that are produced through visualization tools provide a universal language that's able to be interpreted at lightning speed compared to the time it takes to digest copious amounts of data compiled in spreadsheets and reports.
In order to make decisive actions and harness the power of data visualizations, here are three initial strategies to keep in mind.
1. Focus on Spikes or Outliers
When viewing a visualization, it is easier to notice a substantial difference in the data displayed. There's often great value in examining the point where the data fell out of alignment and a change occurred. The visualization above reflects a monthly sales scorecard. You can quickly spot the 12% increase in sales in October compared to other months. From there, you can navigate and drill down into different layers of data to understand if this increase is part of a cyclical sales pattern or if there was another factor that led to the spike in sales.
2. Measure Against Forecast
Numbers are usually only as important as what they are forecasted against. When viewing data visualizations, it's important to understand the target and how it relates to the different totals shown on the dashboard. Forecast data is commonly displayed in bar charts to show actual amounts versus forecast in a clear and concise manner. Let's say you have a quarterly sales goal of $30K, and the visualization reflects a total of $20K in closed opportunities with another $20K in open opportunities. Now that you have a clear understanding of where you are in relation to the sales forecast, you can glean more information on the remaining opportunities and take decisive actions that will help you meet our quarterly goal.
3. Aggregate Diverse Data Sets
Data Visualization tools provide you the opportunity to pull sales forecast data from various sources. In the example above, data could be pulled from Excel, the ERP system, and open opportunities in your CRM. The chart and any corresponding reports would not be available in your source system. Pulling data from multiple sources gives you creative power to draw associations between standalone data sets. This allows for greater understanding and produces more powerful stories.
You will quickly find that there are many additional ways to leverage visualizations. It's important to begin building visualizations for your business and iterate over time as your understanding of the data and the metrics becomes more clear.
