Are charts really useful for decision-making?

For many of us this is a provocative question. Haven’t Tufte, Few, Cleveland and many others proved that, beyond reasonable doubt? Isn’t there a prosperous industry based on the obvious usefulness of charts and information visualization? Is everyone wrong?

Let me play devil’s advocate here. A large majority of charts you’ll find in the corporate sector is irrelevant, if not misleading (check some annual reports for a grim picture). Corporate presentations are nothing more than futile rituals of impression management where the presenter gets his “wow factor” not from how insightful his presentation is, but from how cool the rendering of his 3D flying charts are. Serious managers will never use charts as decision support tools (“just show me the numbers”). Finally, there is scientific evidence that charts will not improve the decision quality (“naive superiority hypothesis”, according to this article).

So, give me a table report with some well chosen key indicators and leave charts to lazy marketers.

How would you respond to this?

11 thoughts on “Are charts really useful for decision-making?”

  1. Exactly. I think an analyst should convey a main conclusion on a chart. Let executors just read right decision with your chart 🙂

  2. I’m not completely surprised, but of course it depends on the situation i.e. what kind of decision has to be made. For an important business decision, I would probably trust a table of numbers more than I would a chart, because there could easily be misrepresentation or something dumb like a typo (depending on who made the chart).

    However, if it’s a decision to choose one type of analysis over another, then the chart is golden. I guess what it comes down to is whether the chart is for EDA or for final results.

  3. Simply put, both are important and it depends on what type of data you are working with.

    Try looking at a table with 5 years of data (by month) and quickly tell me what month is highest, lowest month, what ‘s the trend, is it cyclical, etc. It’s possible, especially with conditional formatting, but not as easily done using charts.

    Plus, without charts, this blog wouldn’t exist! 🙂

  4. I produce numerous charts on a weekly & monthly basis for a large corporation. I wonder sometimes if they ever get read. (Of course they do….B-))
    I am of the opinion that the weekly charts are of little value other than to confirm what a line manager should be able to tell their superiors.
    The monthly charts & tables confirm performance activity, and provide a basis for longer term trend analysis. The quarterly charts do the same, as do the YTD charts, and the bi-annual charts. All of these charts are automatically populated from a single data entry each week….B-)
    From my experience the upper management can assimilate a chart quicker than a table of figures. Remember we’re not talking about financial people here, we have marketeers, designers, business process people, multi-level executives etc, and they do not neccessarily have the ability to “read” a data set. So the charts/grafx etc have a valid place in the Great Business Plan.
    Of course they are valuable…….. It keeps me off the streets, on the net, & out of trouble….. B-)

  5. I do believe that charts are the right tool for specific tasks, but charts are just one of the tools available in the information management / analysis toolbox. I’ll discuss this in the follow-up post.

  6. Tony, dashboard pete: as an excuse for a blog and to keep certain people off the streets are some of the best arguments in favor of charts. Thanks.

  7. Jorge, your animated old/new scatterplot and population pyramid are a sufficient proof for me that charts do make the difference. You made me convinced that growing average age is a common trend around the world (I didn’t know that beforehand).

    Would a simple numeric table have made me as convinced in this issue? No. These charts contain enormous amount of information that immediately make sense when viewed and “felt” in brains.

  8. hi Jorge.
    “serious managers will never use charts”. hmm.
    In finance charts are of the utmost importance. traders quite a variety of charts to analyse commodities and are trained to spot patterns in these charts to make split-second, multi-million dollars decisions, around the clock.
    that being said, back to the general context.
    would a serious manager use bold or italics in a working memo? I’m inclined to think so. if not, she is depriving herself of a valuable way to highlight relevant information. In this context, I regard charts as the most efficient way to highlight critical numbers. of course many charts are poorly designed, usually because people want to cram too much information in them and because they seldom think about the message they want to convey through their chart. but when this is rightly done, then charts can enhance the impact of a presentation, not by dazzling the reader but by minimizing efforts to reach the substance of a message

  9. It seems perhaps you have a narrow definition of charts, one with a foot firmly planted in the world of marketing.

    PREATTENTIVE VARIABLES
    The brain is wired to respond to certain preattentive variables, and if you encode data onto those variables, patterns in the data will instantly leap out to your eye – you don’t even have to think about it. Identifying the same pattern in a table of words and numbers takes longer. Much longer. To me, this is the fundamental research that explains the value of data visualization.

    TABLEAU
    Take a look at Tableau – the demos clearly show an excellent chart tool robust enough for the analasys you describe.

    Regards…

  10. LeMel

    No, I don’t have a narrow definition of charts. I do believe in information visualization as a tool for decision support (that’s why I write this blog…).

    I know how we can use the preattentive process and variables to improve our charts, but the point in the post (and the article it links to) is that management must accept visualization as a serious tool for decision support.

    Recently a CFO asked me: “Visualization? What the hell is that?” and that summarizes nicely all the work we have in the next years.

  11. A really pertinent question! I developed an interest in the subject having chanced upon Tufte booklet where he describes how data visualisation helped solve the London Plague crisis…… Since then I have enjoyed reading books on the subject by Tufte, Few others as well browsing a number of web sites.

    However I have often wondered how useful are charts in a business setting – recently the company I work for has implemented a SAP BI solution and the analysis that can be done is awesome. While the query results are available both as table and graphs I have observed that graphs are rarely used.

    My initial thoughts on the subject is that charting would be useful for problem analysis – data exploration in probably a six sigma exercise. On the other hand for routine decision making purpose charts may not be that useful.

    Would be great if we got the discussion going again – what particular types of business decisions would be helped – and specific examples where eureka momemts have been experieinced by using charts.

    Till that time let us enjoy our interest …..

    Paresh

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