Overview
Business Analytics & Data Visualization are two faces of the same coin. You need the ability to chart, graph, and plot your data. Just as a picture is worth a thousand words, a visual is worth a thousand data points. A key aspect of our ability to understand what’s going on is to look for patterns, and these patterns are often not evident when we simply look at data in tables. The right visualization will help you gain a deeper understanding in a much quicker timeframe.
Before you decide to create any chart or graph, you need to decide what you want to show or convey. Charts convey one of the following types of information: Key Performance Indicators (KPI), Relationships, Comparisons, Distributions, and Compositions. Click on the sections below to learn more about each.
Key Performance Indicator
A KPI is usually a single value that relates to a particular area or function and is a reflection of how well you are doing in that area or function. This varies from business to business and function to function. Here are some popular KPIs that companies like to track:
Net Promoter Score (NPS): How likely is it for a customer to recommend your product or service to a friend?
Customer Profitability Score (CPS): How much profit does a customer bring to your business after deducting customer acquisition and customer retention costs?
Conversion Rate: How many leads get converted to customers?
Relative Market Share: How big is your slice of the pie compared to your competitors in the market?
Net Profit Margin: The percent of your revenue which is net profit.
KPIs are best represented using KPI charts.
Relationships
Here you are trying to either establish or prove whether a relationship exists between 2 or more variables. As shown in the table below, the chart type that is best suited for your data would depend on the number of variables you need to use.
Scatter Chart
Two variables
Relating Marketing Spend to Sales Revenue. Here you could show Marketing Spend on the X-axis and Sales Revenue on the Y-axis.
Bubble Chart
Three variables
Relating ROI, Investment Time, and Investment Size. Here the X-axis would be the Investment Time, the Y-axis would be ROI, and the size of the Bubble would be Investment Size.
Comparisons
Here you are trying to show or examine how different variables change over time or provide a static snapshot of how different variables compare. The type of chart you choose would depend on the number of variables you need to use.
Bar Chart
One variable
Comparing sales of various models of cars in a given month.
Table
Three variables
Comparing Revenue Per Employee, Revenue Growth, and Territory Size. Here two of the dimensions would be the Row and Column of the table while the third dimension would be the cell value.
Column Chart
One or two variables changing over time.
Showing month-over-month Sales and Web Traffic. You would have two columns for each time period. One representing Sales and the other Web Traffic. The X-axis represents Time in months while the Y-axis represents Sales and Web Traffic.
Line Chart
Three or more variables changing over time.
Showing month-over-month Sales, Web Traffic, Webinar Registrations, White Paper Downloads.
Distributions
As the name suggest, here you are trying to show how your data is distributed over certain intervals. Here intervals implies clustering or grouping of data, and not time.
Column Histogram
One variable
Showing how many customers have made one transaction, two transactions, three transactions, etc. Generally you are counting something and putting them into ‘buckets’ or ‘bins’ of a measurement like amount, frequency, duration, etc.
Scatter Chart
Two variables
Relating ROI, Investment Time, and Investment Size. Here the X-axis would be the Investment Time, the Y-axis would be ROI, and the size of the Bubble would be Investment Size.
Compositions
This is when you want to highlight the various elements that make up your data - in other words, its composition. Your first choice here is whether your data is static or if it is changing over time.
Get Started with Business Analytics and Data Visualization
If you are thinking about instilling a data-driven culture in your organization and giving the power of business analytics and data visualization to all your employees, you need to go with a solution that is simple to learn and use, scales and adapts to the demands placed by your employees, and doesn’t end up being very expensive. Check out Amazon QuickSight and see if it meets your needs.