There are many data visualization advantages that can help generate better results. Data visualization takes myriad data and synthesizes it into new forms. This visually presented data enables viewers to easily explore it, understand it, and engage with it in ways most relevant to them.
With powerful applications in a variety of different situations, data visualization produces tangible results for businesses. Teams can deepen their understanding and craft solutions instead of puzzling over masses of data and arguing about its significance. One of the great advantages of data visualization is that it is highly intuitive, requiring no special training to find patterns in visual displays.
An Aberdeen report states that organizations that use visual data discovery tools are 28% more likely to find timely information than those that rely on reports and dashboards. The study also reports that 48% of business intelligence users at companies with visual data discovery are usually able to find the information they need without the help of IT staff.
These are just some advantages of data visualization. There are specific benefits in every area of business operations. Let’s look at the five most important data visualization advantages for business:
- Insights from data visualization help to enhance employee engagement and performance
Given that attracting and retaining top talent is a strategic imperative for business, many leaders need to evaluate the best approaches to achieve it. But this is a complex area and the underlying reasons that impact talent acquisition, performance, motivation, satisfaction, and attrition are not always easy to understand. In the absence of data, people management tends to rely on gut feel.
Data visualization can make a huge difference in human resources (HR) management. For example, consider that management is reviewing the results of an employee engagement survey. Visualization can be used to present results by department, function, region or location, or to overlay other factors such as manager, compensation and so on. With visualization, patterns emerge that cannot be easily spotted if the data is viewed as multiple tables. Correlations and trends can also be seen far more easily and managers can now work on building employee engagement by building on insights based on actual data.
When it comes to performance management and compensation, data visualization empowers managers to understand multiple factors at play such as workload, manager effectiveness, recognition, career path, training and more. On the other hand, managers who do not have insights on these aspects are forced to make compensation the main factor of study and discussion. Used effectively, data visualization can be an extremely powerful manner to enhance employee engagement and performance.
- Data visualization increases the effectiveness of the sales function
Managing an effective sales operation requires a consistent and well-monitored execution process. It is also very important to know what’s working and do more of it or eliminate activities that are not getting results. Apart from internal processes, there are many external factors that impact sales, making it important for sales teams to understand them and adapt. How can sales managers view, track and analyze all these different aspects during execution and not later when reports are generated?
While sales automation systems and CRMs generate reports, they do not bring out patterns, trends, or interrelationships as strongly as data visualization techniques do. Usually, it’s not very easy for different people to change parameters and get different views of the same data. Data visualization helps to see patterns and trends by persons, over time, locations, categories, and products.
In organizations where data visualization systems are available, sales teams define the key performance indicators (KPIs) that they want to track. Leads, milestones or deal closures can be viewed by salesperson, product or individual accounts.
Some teams use visualization effectively to monitor progress and motivate performance. For instance, let’s say you have defined that each salesperson needs to make X number of calls in order to generate Y number of deals. A visual report illustrating calls per salesperson and successful closures becomes an effective motivator for the team and also helps to see who is having difficulty delivering results and at what stage. The sales manager can then roll out changes fast, such as moving a particular salesperson to another territory or providing additional support or training.
Understanding customer behavior and market intelligence are other important data visualization advantages. A fashion brand would certainly be reviewing sales figures but data visualization can help to get deeper insights and find patterns such as which styles are popular among buyers in large cities or small towns, whether some specific styles sell more at certain format stores, or which items tend to be purchased together. This understanding helps to plan stocks that meet demand, phase out products that are not popular, and make decisions regarding distribution.
- Better operations by understanding spatial factors
There are many business operations that are influenced by geolocations and 3D spatial locations. For instance, agriculture businesses that are spread over large tracts of land, sales operations that are spread across a distribution network, or infrastructure such as oil and gas pipelines are all examples of business operations where spatial factors play a role. When viewing the data about business operations, the ability to overlay it with the geospatial data is extremely helpful.
A model can be built based on geolocations or other identifiers such as street addresses and zip codes. Let’s consider an organization that sells or services equipment. When data about equipment breakdowns and downtime is viewed along with geolocation, it becomes much easier to understand how different factors such as stocking of spares, location of engineers, and routes used by service vans are impacting the reliability of the equipment. Geospatial analysis adds value to customer service, finance, sales, distribution, and operations.
Logistics and distribution companies can use data visualization to understand patterns related to delivery operations and to plan the most optimum location for warehouses and the best routes for delivery.
- Better financial management with data visualization
Savvy CFOs today know the advantages of using data visualization when sharing data with stakeholders. It’s not easy for everyone to understand financial reports and their implications, so visualizations go a long way in helping to inform stakeholders.
A clearer understanding of financial performance helps the organization to achieve better capital utilization, cash flow management, expense tracking and progress monitoring of financial goals.
For example, an important target can be displayed as a gauge with an arrow showing the current position. This easily conveys to stakeholders how much more work needs to be done in order to achieve the target. This conveys clarity, generates a sense of urgency, and is easily understood by all stakeholders.
Financial data can also be seen in conjunction with operating parameters when it is presented visually. The CFO can easily demonstrate the financial impact of decisions taken about manufacturing or staffing or sales or logistics. This enables the leadership team to build consensus and make decisions that are in the financial interest of the company.
- Higher productivity and better quality of manufacturing with data visualization
On the factory floor, key production parameters about output and quality need to be monitored. Are we on track to achieve production targets for the day or the week or the month? What quality issues have been reported and what are possible causes? Are any of the machines down?
Finding answers to these requires data and analysis. The modern factory collects data at many points. Traditionally this data was collected and recorded manually; today it could be generated from IoT systems. The huge amount of data that IoT can collect is not useful if it’s not properly interpreted and analyzed. Data visualization can help to make sense of this complex and large amount of data. For example, we can now look at quality issues over time and also see how it changes with different raw materials, suppliers or processes. Factors that may be contributing to quality issues can be identified and handled.
Automated systems that generate data visualization in real-time enable prompt decision making and provide top management visibility into the production shop floor.
We looked at some data visualization advantages for businesses in HR, sales, operations, finance, and production areas. How you apply the power of data visualization to enhance the productivity and profitability of your business depends on your specific goals, the nature of data and the reporting needs of stakeholders. Create visualizations that will best bring out the insights that your business needs.