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Thinking Visually. Introduction. Thinking visually seeks to enlarge your capacity to process vast quantities of data that you possess. You need informative and eye-appealing charts and graphs to make data meaningful. So you can see in graphic form what is not so clear before. .
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Introduction • Thinking visually seeks to enlarge your capacity to process vast quantities of data that you possess. • You need informative and eye-appealing charts and graphs to make data meaningful. • So you can see in graphic form what is not so clear before.
Focused measurements • Focused measurements draw attention to important and highly relevant data by presenting them in a clear and uncluttered manner. • By using focused measurements companies can move both quickly and assuredly in order to seize new opportunities. • When management have a framework within which to measure and implement change, then these focused measurements put change in perspective. • Focused measurements are often best displayed using charts and graphs.
Focused measurements • Charts and graphics can be used to: • Improve efficiency and effectiveness • Improve quality • Solve problems • Plan • Monitor processes • Depending on the subject matter, charts and graphs can be clearer and easier to comprehend than writing text.
Tools used • These charts and graphs can easily be put together using electronic tools such as Microsoft’s PowerPoint, Excel and Visio. • Some people find a blackboard and chalk or pen and paper more comfortable to work with, but have the disadvantage of being difficult to store or distribute on a large scale. • The decision of which chart to use is often more difficult than the end production of the chart.
Visual Tool: Tracking • Tracking is used to monitor fundamental financial concepts such as sales, cash flow, and income statements. • The following diagrams show the progression from a basic Sales and Margin Vs. Time Chart to a more useful form.
Sales and Margin Vs. Time Figure 1 • In the previous slide monthly sales and gross margin data are displayed. • Gross margin is equal to sales minus the cost of goods sold. • Although the numbers are accurate, there is no real analysis or information for management behind these figures.
Sales and Margin Vs. TimeFigure 2 • By combining the sales and gross margin dollars into quarterly data, and by adding gross margin percent, suddenly our figures have relative meaning. • Gross margin is equal to gross margin percent.
Sales and Margin Vs. TimeFigure 3 • This chart is better still, since it shows graphically at a glance, how well the group is doing.
Sales and Margin Vs. TimeFigure 4 • This chart is even clearer. • There is a lot going on; we have added a caption, or key takeaway box, highlighting the most significant aspect of the improvement. • A key takeaway box answers the question “What does this mean?”
Overall • The spreadsheet in figure 1 has matured in to a graph in figure 4. • The most important point about the transition is not to force your audience to think when you should be thinking for them.
Variance and Comparisons • These charts display the relative difference between groups or elements. • The main diagrams for variance and comparisons are: • Deviation graph • Side – by Side Column Graph • Side – by Side Bar Graph • Radar Chart
Deviation graph • A deviation graph displays the differences between data series and some known reference, such as a budget, industry standard, or prior year’s results. • Deviation graphs are often used to display performance to standard cost, performance to schedule, performance to cost reduction goals, or performance to departmental budgets.
Figure 5 Budget
Figure 6 Figure 6
Figure 5 vs.Figure 6 • Figure 5 shows actual data with the budget of 5 million euro displayed as a constant broken line. • Figure 6 is the deviation graph, since it shows the difference between actual profit and budget. • When the actual profit value is above budget, the difference is denoted as positive; when profit is below budget, the difference appears as negative; and when profit is equal to budget, the deviation is zero.
Side – by Side Column Graph • A side by side column graph is a column graph with two or more data series plotted side by side for comparison purposes. • The columns for a given data series are always in the same position in each group throughout the given graph.
Side – by Side Column GraphFigure 7 • In figure 7, each plant makes the same product, and the vertical axis displays percent of total cost. • The information for Plant A is always at the left of each group, followed by the information for Plant B and C. Each data series is a different colour, shade or pattern.
Side – by Side Bar Graph • A side-by-side bar graph is a bar graph with two or more data series plotted side-by-side for comparison purposes. • The bars for a given data series are always in the same position for each group throughout a given graph.
Side – by Side Bar GraphFigure 8 • In figure 8, the information for Plant A is always at the top of each group, followed by the information for Plants B and C. • Each data series is a different colour, shade, or pattern.
Radar Chart • A radar chart is a circular chart is used primarily as a comparative tool. • For example the nutritional content of two different foods might be compared based on the percentage of recommended daily allowances of five different vitamins that each contains.
