In Part I of this series, I covered some of the key metrics and visualizations that contribute to a 360 degree view of your customers. Today let’s explore two more metrics that reveal insights about your customers’ relationship with your company, and the graphs that best explain the data.
Track Net Promoter Score with a Gauge or Bar Chart
At B2B companies especially, you’ll often need to call upon your customers to serve as references in order to close new business. Some CRM systems like Salesforce.com enable you to add checkboxes to indicate whether a particular customer will serve as a reference or not. It’s simple to run a report on that information, summarizing the number of checkboxes over the total number of customers, but visualizing a more robust metric on a dashboard keeps customer relationships top-of-mind with your marketing, sales, and customer support teams.
Many arcplan customers are going back to an old standby metric, the Net Promoter Score (NPS), which segments the percentage of customers who would recommend your products and services (“Promoters”), versus those who are satisfied but unenthusiastic (“Passives”) and those who aren’t happy and might go out of their way to voice negative opinions (“Detractors”). On a scale of 1-10 for the question “How likely would you be to recommend <<company>> to a colleague?”, Detractors are the people who choose 1-6, Passives choose 7-8, and Promoters choose 9 or 10:
In my previous post on this topic, I covered why planning visualizations are important for an audience of planners without finance backgrounds: they prioritize content and separate the signal from the noise so planners know at a glance what areas of the plan need their attention. Today I’ll underline the importance of using the right chart types to tell your plan’s story. The idea is that visualizations should enable planners to prioritize the largest areas of their plans and see exactly what parts need adjustment, without forcing them to read anatomically correct financial statements or have a deep understanding of planning terminology.
Particularly, the term “variance” can be incredibly confusing to non-finance department heads who are tasked with managing budgets. Variances of actual spend compared to the budget are either positive or negative, indicating which direction the line item deviates from the plan. In general, being under budget is a positive variance, and being over budget is a negative variance. But things get weird when you’re looking at expenses vs. income and it’s hard for regular planners to make sense of it all. So the best way I can think of to help non-finance planners understand their plan performance better is to simply use terms like “favorable” and “unfavorable” instead of “positive” and “negative” (i.e. “you’ve got an unfavorable variance for airfare because of the unplanned training course in Las Vegas that your whole team attended”) and to introduce planning visualizations that simplify complex concepts like variances.
Horizontal Bar Graph
A horizontal bar graph with red and green bars is an ideal visualization for a budget statement because it’s straightforward and eliminates confusion. In the example here, the budget categories are prioritized from most unfavorable to most favorable. We see that relocation and airline expenses are the most unfavorable – they’re the most over budget – and they are emphasized by being in red at the top of the graph. But reallocating funds from the most favorable categories – incentives and salary – can alleviate the problem. Incentives and salary are the most under budget; we’ve spent less than we’ve planned and there may be funds that can be moved to the relocation and airfare categories.
The horizontal bar graph visualization tells the story of which items are doing well, which items are doing poorly, and makes it obvious where adjustments can be made.
Waterfall or Bridge Chart…
Decision-makers depend on insightful charts and graphs to help them make fast, accurate decisions. “Insightful” charts and graphs are easy to read and understand and are the right design for your data. The wrong chart type can throw everything off and make your dashboard unusable. For example, while pie charts are most often used to display the share or percentage of a total, they’re not good for comparing the relationship between two variables – a scatter chart is better for that. While bar charts are good for comparison, if you want to compare many categories of data over time, go with a line chart.
Are you tasked with creating the dashboards that are used every day at your organization? As dashboard experts, let’s take a look at a few practical examples of why certain charts are better suited to display certain types of data versus others. If you find this article useful, be sure to view our webinar recording Scorecard & Dashboard Development: A Detailed How-To, where you’ll get more practical tips to create interactive, “go-to” dashboards.
Sales data for the year may be best displayed on a bullet graph. This type of graph displays a fair amount of data in a small space, compares measures to enrich its meaning, and is generally a simple, uncluttered visual representation of data. With a bullet graph, the budgeted sales amount for the year is represented by the entire length of the bar; the actual value is represented by the thin bar in the forefront (blue on the sales bullet graph). The shaded grey areas (in our image) represent the values “poor,” “satisfactory,” and “good.” In our image, the sales data is satisfactory, approaching good. Stacking bullet graphs allows the user to compare values with ease – here, sales vs. costs. A bullet graph would even work well as a desktop widget since it can showcase an important KPI in a simple, space-efficient format.
Would a bar chart work for this same data?
A bullet chart is actually a variation of a bar chart. Even though bar charts are useful for comparing data as well, for our sales example, it may not be your best option. With a bar chart, you’d need to have 2 columns per month – one for actual and one for the target/budgeted amount. Alternatively, you could use a stacked bar chart, but that is basically what we have here with the bullet graph, only with even more data than a stacked bar chart typically offers. Because it would be difficult to track your progress over time, a standard bar chart isn’t the most efficient chart type for sales actual vs. budget data.
Candlestick Charts vs. Bubble Charts