Thinking Visually

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Thinking Visually
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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.

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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.

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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.

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Tools used

• These charts and graphs can easily be put
  together using electronic tools such as
  Microsofts 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.

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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.

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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.

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Sales and Margin Vs. Time Figure 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.

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Sales and Margin Vs. TimeFigure 3

• This chart is better still, since it shows
  graphically at a glance, how well the group is
  doing.

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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?

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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.

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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

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Deviation graph

• A deviation graph displays the differences
  between data series and some known reference,
  such as a budget, industry standard, or prior
  years 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.

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Figure 5
Budget
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Figure 6  

Figure 6  
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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.

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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.

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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.

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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.

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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.

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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.

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Figure 9