The DataBoost Nexus #4
Data Visualization – Why is it important?
Last week we covered the definition of data visualization. According to SAS.com:
“Data visualization is the presentation of data in a pictorial or graphical format.”
So why is transforming information into pictures or graphs a big deal?
The short answer is because it works.
For a longer answer, consider the pages and pages of information you look at every day to run your business. As your company grows, more and more data becomes available to feed into reports, and therefore more pages are placed on your desk.
A good data visualization solution will gather all of the pages on your desk and summarize them, and then summarize the summaries. Then it will allow you to take your newly summarized summaries and compare them to summaries from past days, or weeks, or years, on whatever subject is being summarized.
Sound confusing? Time for a familiar example.
A Familiar Example
A superb data visualization solution can be found in the dashboard of your car. Here, you’ll find a number of instruments and electronics all competing to provide you with information about what’s happening inside your automobile. And all this information about what’s happening inside your car is coming from data sources that you wouldn’t care about otherwise.
When you’re driving, you’re not interested in the number of times your wheels turn per second, and you don’t want a constant update of transmission gear ratios. But you do want to know how fast you’re going, preferable with some degree of accuracy. That’s why you have a speedometer, and a speedometer is a form of data visualization.
But your speedometer isn’t alone. Your temperature gauge, oil pressure indicator, check engine light, even your climate control readout all pull in information from multiple sources to provide you with a constant update in real time on something that matters while you’re driving.
A Business Dashboard
So, imagine a dashboard for your business. You’d have constant updates on important metrics from throughout your company, all created from multiple sources of data, and all summarized in a way that allows you to read them instantly. Like a speedometer.
As your business grows, the amount of information that needs to be processed grows along with it, and the need for a business dashboard that makes sense of all this data becomes increasingly integral to maintaining a competitive advantage.
So, the real question is: If your competitors are using data visualization solutions, can you afford not to?