Data visualization is becoming more popular and necessary for modern businesses. Driven by a combination of more available data, more advanced artificial intelligence (AI) engines, and demand for more customizable reporting systems, data visualization exists to help you make better decisions and truly “understand” information related to your company’s operations.
But with so many data visualization tools emerging on the market, how can you tell what your business really needs?
Benefits of Visualizing Data
Let’s start by defining the real benefits of data visualization:
- Perception and intuition. First, you’ll find yourself able to digest and understand information faster. Human brains are wired to prioritize visual information, as sight is our primary sense; we’re able to grasp the concept of a graph far quicker than we can a paragraph containing the same information. Accordingly, data visualization improves both comprehension and speed.
- Visuals also simplify complex concepts and large data sets. Rather than looking at hundreds of iterations of thousands of variables, you can let an algorithm filter out the outliers and present only the most important information. It makes it possible even for amateurs to understand inherently complex topics.
- Data visuals are also easier to present, whether you’re showcasing your results to a boss or supervisor, or discussing your latest findings with a client. It saves time in meetings and allows you to illustrate your key points in a stronger, more persuasive way.
Types of Visualization Software to Use
So which areas of your business are most important to realize these benefits?
- Project portfolio management (PPM). In case you aren’t familiar, project portfolio management (PPM) is the process of collecting information on your current lineup of projects, prioritizing them, and assigning resources to them according to their profitability, urgency, and other factors. It may seem like an easy task, but you’ll be dealing with multiple complex variables, including costs and available resources, which differ in every project. PPM software helps you visualize these key components, so you can see, at a glance, which of your projects are in most need of resources, and which ones can be shelved for a later time.
- Productivity analysis. Data visuals are also helpful when it comes to analyzing employee performance, such as with time tracking software. If you see that one of your workers spends more time on non-work-related sites than another, it may not mean much, but if you see a spike on a graph where all other areas are flat, it’s going to stand out to you. You’ll also be able to visualize exactly how profitable your projects are, by seeing—rather than measuring or calculating—how much time they cost to complete.
- Marketing and advertising analytics. Marketing and advertising analytics are important for a similar bottom-line-driven motivation; visuals help you “see” how profitable your efforts truly are. Profitability in marketing is notoriously hard to nail down, since in addition to measuring firm benefits (like how many new customers you’ve gotten), you’ll need to consider looser, less defined variables like how much brand exposure you’ve gotten. The visuals here will make it easier to understand—and explain to the decision makers responsible for allocating your budget for the year.
- Financial planning. Speaking of budgets, data visualization is especially helpful in the realm of financial planning. No matter what your organization’s mission is, profitability is key to your success, so it pays to know exactly how much your business is spending, how much revenue it’s bringing in, and how those variables might change over time. With a few experimental inputs, you’ll be able to visualize scenarios that haven’t yet unfolded, and demonstrate the power that a few financial decisions could have on the future of your business. It’s also enormously helpful in ensuring that your business remains cash flow positive—especially during the early stages of your business’s growth.
- Market and customer research. Finally, you’ll make great use of data visualization when analyzing market trends and customer-centric research. Your customers’ buying decisions will depend on thousands of variables, including previous buying decisions, your competition, market conditions, and changing trends. Many of these variables are hard to define, and even harder to measure in an objective way. Data visuals attempt to do this as expertly as possible, giving you a loose visual gauge that you can use to understand your core customers’ needs and future behaviors.
Data visualization is most important in areas that define your business’s core profitability, because in these areas, it’s important that you make the most informed, objective decisions possible. Investing in data visualization software will represent an additional expense in your business’s monthly budget, but you’ll stand to earn a significant ROI in cost savings and profitability optimization.