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There are those among us who can easily make sense of vast chases of data. But the rest of us need visual aids to recognize patterns, identify trends and get the pulse of the customer base in order to increase profits.
The key benefits of data visualization include faster and better decision-making. A graphical representation of complicated data enables analysts to diagnose problems with their business strategy and improve their approach. This process is facilitated with the use of charts, dashboards, and infographics.
By highlighting particular aspects of the data, these visual aids make it easier to comprehend and absorb the most crucial bits of information. In many ways, they allow the data to tell its own story and pinpoint specific sections for further analysis and discussion.
The importance of data visualization correlates with data analysis, which transforms the data from its original form into a more visually pleasing and digestible layout. In other words, data analysts use business intelligence tools that transform a lengthy report into an interactive data visualization form. Here is how it works.
The Granny Smith Problem
Let’s say you’re a data analyst for a large company that grows and sells more than 100 types of fruits worldwide, and you get a quarterly report with hundreds of thousands of excel cells filled with precious data. As you analyze the data, you notice that the cultivation of Granny Smith apples is down 35% due to resilient bugs attacking the company’s crops.
Here, the purpose of data visualization is to help you present this information through an absorbable report at the next meeting. You’ll include a visual representation of the data in the form of slides and by using the charts tool.
This is presented to the board of directors and executive managers, where each member covers the cultivation of a specific fruit. And an executive that deals with oranges may not have intimate information about apple cultivation.
But if they’re all looking at easily digestible slides, they’ll understand what the data is saying regardless of their area of expertise. And when the management team notices the significant drop in Granny Smith production, they can get down to finding a solution. So why is data visualization important? Simply put, this is a key ingredient in the broader data analysis process.
Shine a Light With Visual Representation of Data
Data visualization software uses charts, dashboards, slides, graphs, infographics, maps, and videos that help convey dense information in a straightforward manner. This is becoming an invaluable tool for executives and business intelligence analysts because data strings are transformed into a universal language that everyone can understand and participate in.
There are many reasons why data visualization tools improve everything from the decision-making process to the businesses’ broader operational productivity and efficiency. Let’s delve further into some of the benefits of data visualization.
1. Cover Huge Amounts of Data
People are visual creatures, and we can process images a lot faster than words and numbers. Pie charts and other visuals often convey the information in mere minutes, whereas dozens of spreadsheets are far harder to decode.
Thanks to the evolution of data visualization software, we now have access to more advanced visualization techniques, such as a heatmap that shows the density of one category under a specified time or condition. One of the business benefits of data visualization is that you can use Gantt charts for project management and HR timesheets that display more refined analysis.
2. Recognize New Trends
Analysts often describe data visualization as a tool for creating order out of chaos. This is highly useful when it comes to identifying emerging trends in business. When the data is visually brought to order and cleaned up, you can spot changes in consumer preferences and market shifts. This is one of the many benefits of big data visualization.
Recognizing new trends can translate into increased profits, but failing to identify changes in the market can have catastrophic consequences for individual companies. As such, delivering effective data visualization in a timely manner to the entire team is a crucial part of running a successful business.
One of the ways in which businesses measure how effectively they’re achieving key objectives is with the Key Performance Indicator. These KPI reports are heavily reliant on data visualization tools to communicate the performance of individuals, departments, and entire organizations. They can be used on a strategic level to analyze the health of the business or to measure the productivity of individual employees.
3. Faster and Better Decision Making
Data visualization benefits everyone, from the stakeholders and the executives to the company’s decision-makers. When large volumes of data are properly visualized and simplified, it makes it easier for everyone involved to consume and understand the information.
A simple chart or a heatmap can go a long way in helping businesses identify patterns. This paves the way to actionable conclusions that inevitably speed up and improve the decision-making process.
4. Spot Inconsistencies and Mistakes
Data visualization also unveils the connection between operations and results. And from these connections, we can get metrics that expose any inconsistencies or mistakes in the data. This is one of the benefits of interactive data visualization.
Once we spot these errors, we can make faster data validation or course corrections and take decisive actions to fix the problem before it escalates. Info about a sudden drop in the number of Granny Smith apples displayed in stacked line tools is easy to notice and will prompt executives to investigate further.
5. Superior Report Modification
Countless spreadsheets limit one’s ability to dig deeper into the data and identify crucial components that can improve operational productivity. On the other hand, an intuitive Power BI and Tableau visualization interface encourage users to rely on advanced analytics capabilities that tell the story behind the data.
By capitalizing on the benefits of data visualization, data analysts spend significantly less time extracting information from cloud databases, modifying reports about individual teams and departments, and filling impromptu report requests.
6. Better Team Communication
The best and most efficient way to inform team members about any emerging trends in your business is by using brief and general overviews of the raw data. This is where data visualization serves to boost your team’s productivity and operational efficiency. Moreover, the value of data visualization cannot be overstated at a time when many companies worldwide are implementing remote work policies because keeping remote teams on the same page can be challenging.
The Future of Data Visualization
Data caches are only getting bigger and more complex. Amid the ongoing development of data analytics tools, data visualization will increasingly be used to help team members digest dull and complex information. This visual format simplifies the data and allows you to analyze it. That, in turn, enables the entire organization to consume the information and gain valuable insights into market trends and other important factors. There are several free data visualization tools that are ideal for those who haven’t had prior experience with this concept.