Application of Graphs/Charts in Business
Walk into almost any business meeting and you'll see one of these talked about at some point. What is it? It's either a graph or a chart describing something about the business. It could be a chart showing the progress the team is making on a big project. Or it could be a graph showing the sales of the business and comparing it with the sales of the competition. Either way, these graphs and charts make the information much easier to digest and understand
Why
Graphs/charts in Business?
To
convince and persuade in today’s corporate world business people must
construct evidence based arguments. They must demonstrate, not simply assert. Using the
right business charts during your presentation is essential to demonstrating
your point and is also easier to understand.
Graphs
are the most effective in business when the
- The
message or story is contained in the shape of the data series
- The
display will be used to reveal relationships among whole sets of values
Using
the right chart can make the difference between a persuasive and flop
presentation.
Roles
Charts and Graphs Play in Business
· Your
Brain Processes Visuals Quickly and Efficiently –
· They
Help to Point Out Problems and Market Trends
· They
are Very Shareable
· It
Reduces the Margin of Error
· Visuals
Can Help Further and Continue Your Research
How
can you build an effective graph/chart?
When
you make a chart/graph you are describing one of the following relationships
Nominal Comparison Deviation
Time Series
Distribution
Ranking
Co-relation
Part to whole Geospatial
The process of effective graphical construction begins with a simple analysis of the information available. Pattern detection comes in very handy to decide the right kind of visual that will best represent your data. Graph construction is an iterative process meaning that there is ample scope for trial and error to assess what works best. Given the popularity and flexibility of graphics and the importance of the patterns revealed by using images, graphs are key decision-making tools for any enterprise. Analyzing these relationships in depth you can finalize what type of chart you will use to present your data.
Types
of graphs/charts used in Business
Businesses
have many uses for graphs and charts. There are many types of graphs and
charts, making it easy for a business to choose the one that fits their needs
the most. Let's take a look at some choices of graphs and charts available to
businesses.
Column
Chart
This
type of chart has vertical columns. The height of each column, for example,
tells you how much the corresponding item is. If, instead of columns, the chart
has horizontal bars, that is called a bar chart. Businesses can use column or
bar charts to compare products or to show how much is used each day. This type
of chart lends itself well as a comparison tool, as it's easy to visually see
which item's column or bar is taller or longer. This chart, for example, shows
the number of ice cream sales this past week.
Line
Graphs
Line
graphs are those graphs that show your data as a line. Each successive
data point is connected to the previous. This type of graph is best suited for
data that is continuous in nature, such as showing the operating temperature of
a computer chip over time. For example, a computer company can use a line graph
to show the temperature of its processor as a person is using it for both easy
word processing tasks and then some intensive gaming tasks. You'll see the line
curve up and then down.
Pie
Charts
Pie
charts are those charts that look like pies, hence the name. Each pie is
split into slices with each slice representing one particular group of data.
The size of the slice shows you how much of that group of data you have.
Businesses can use pie charts to show their market size, such as this one
showing how much of the market a particular shoe company has.
Area
Chart
An
area chart is a type of chart that represents the change in one or more
quantities over time. It is similar to a line graph. They are both good for
showing trends. However, the area chart is different from the line graph,
because the area between the x-axis and the line is filled in with colour.
Thus, area charts give a sense of the overall volume. Area charts emphasize a
trend over time. Also, area charts are perfect for indicating the change among
different data groups. For example – Sales and Revenue
Scatter
Plot
Scatter
plot is a graph that represents a relationship between two variables. The
purpose is to show how much one variable affects another. Usually, when there
is a relationship between 2 variables, the first one is called independent. The
second variable is called dependent because its values depend on the first
variable. But it is also possible to have no relationship between 2 variables
at all. Example – Monthly e-commerce sales vs Online Advertising costs.
What
are Financial Graphs
Financial
graphs and charts visually track liquidity, budgets, expenses, cash flow, and
many other financial metrics while helping businesses avoid a monetary crisis
by leveraging financial data in real-time, with a comprehensive overview of
financial information. To ensure the best possible performance and financial
health of a company, conducting regular financial analytics and ensuring the highest quality of data
management must be the top priorities of companies no matter the size. If the
finance department raises an alarm, everyone must carefully listen because
it concerns the most crucial information and can lead to serious damages if
ignored. That's why financial charts and graphs need to be created with the
utmost care and attention.
Conclusion
Graphs
sometimes do not always get the credit they deserve in the business world.
Often, they are joked about as being silly visual aids. In reality, they
provide great value. Graphics are typically used to better represent a set of
results or patterns and help improve the presentation of a study. Serving as
illustrative visuals they can improve cognitive reasoning and enhance the scope
of how an evaluation has turned out. The concept of data visualization is a great
tool that can help assess business performance. In the area of business
management graphical analysis is essential in presenting crucial information
and in taking appropriate remedial action. Reporting and tracking the market
targets of companies is best managed by creating graphs and charts to visualize
data and comprehend statistics.
This blog is a submission for assessment for SVKM's Narsee Monjee College of Commerce and Economics (Autonomous) under the guidance of Prof. Conrad Coelho.
Sources
· http://www.intellspot.com/graphs-examples/
·
https://www.mathworksheetscenter.com/mathtips/graphsandbusiness.html
·
https://boostlabs.com/blog/business-intelligence-charts-and-graphs/
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