Importance of Data Visualization and BI Tools

In the current Information Age, we live through a world of data. Today, everything from an individual to a multinational corporation relies heavily on various types of data and its analytics for their everyday needs. Forbes put forward truly mind-boggling statistics on the amount of data we generate every single day. It estimates that we create, at our current pace, nearly 2.5 quintillion bytes of data each day. With the adoption of the Internet of Things (IoT), this pace is only accelerating.   

Despite the ever-increasing volume of information being collected through data analysis today, the functioning of the human mind is the only thing that stays away from change. We think in stories and pictures. Only through the visual representation of data can we interpret it for the benefit of an individual or an organization. Here, the relevance of Data Visualization and Business Intelligence (BI) tools emerges.    

What is Data Visualization? 

Data visualization is the technique to provide us with a clear idea of the information by giving it visual representation through charts, maps, or graphs. It turns the data into a much more easily digestible format for the human mind to comprehend and quickly identify trends and patterns in larger data sets. 

The Benefits of Data Visualization 

Data visualization aids an enterprise in quickly recognizing patterns and improves its decision-making process with interactive visual representations of data. Here are some of the benefits of data visualization for a business organization. 

Easy Identification of Correlations: Data visualization enables easier identification of correlations between independent variables. Thus, an enterprise can better understand different independent variables and make better business decisions. 

Identifying Trends: Identifying trends is the most useful application of data visualization. The necessary data from the past and the present helps an enterprise make futuristic yet accurate business decisions. 

Examining Frequency: Data visualization helps to explore the frequency of customers’ purchasing patterns and aids an enterprise in identifying the behavioral patterns of prospective customers towards its different marketing and customer acquisition strategies. 

Studying the Market: Data visualization takes the data from different markets, displays it on charts and graphs, and provides an enterprise with insights into which target audiences to focus on and which ones to ignore. 

Risk and Reward: Risk and reward metrics should be analyzed through tedious yet complicated spreadsheets and numbers without data visualization. Once the data is visualized, enterprises can quickly home in on areas that may require action. 

Swift Reaction to the Market: An enterprise’s ability to obtain visually enriched information easily and quickly on a functional dashboard allows it to proactively respond to ever-changing market conditions and avoid making mistakes. 

What are BI tools? 

In the modern-day data-driven world, data comes in both structured and unstructured formats from various sources like documents, journals, books, electronic medical records (EMR), images, videos, email, and other business sources. 

Business Intelligence (BI) tools are application software that collects and processes large volumes of unstructured data from internal and external sources. They amass data primarily through queries. In addition, these tools prepare data for analysis by helping an enterprise create data visualizations, dashboards, and reports. As per a recent report by Markets and Markets, the global BI market is expected to grow from $23.1 billion in 2020 to over $33 billion by 2025, at a Compound Annual Growth Rate (CAGR) of 7.6%. 

Enterprises of every shape and size implement BI tools to manage, analyze and visualize business data or information. More than that, they are helpful for businesses to boost revenue streams and stay competitive in the market. Apart from the few benefits of BI tools for companies mentioned previously, there are a few more ways BI tools can add value to any business. 

They are: 

• Fast and accurate reporting 
• Better, more rapid, and accurate decision-making
  
• Valuable business insights 

• Competitive analysis 
• Better data quality 
• Increased customer satisfaction 
• Identification of market trends 
• Improved operational efficiency 

• Lower margins 

Every Business Needs Data Visualization and BI Tools 

BI tools help an enterprise to carry out data visualization. So, the implementation of both these technologies in businesses empowers business leaders and employees to speed up and improve their decision-making and operational efficiency.  

Enterprises must be power-packed with informed decisions and enhanced performance to stay ahead in today’s rapidly evolving yet highly competitive business world. BI tools and data visualization have all it takes to make this happen. The belief that BI tools and data visualization techniques are meant only for large businesses does not stand anymore. They are for everyone, be it a large or small enterprise.