Posts Tagged ‘bar chart’

Bullet Graphs for Not-to-Exceed Targets (Visual Business Intelligence)

Wednesday, January 28th, 2009

[Editor's note: The bullet graph is an alternative to circular gauges and meters commonly used on dashboards with a graph that provides a richer data display using less space. The bullet graph consists of five primary components: text label, a quantitative scale along a single linear axis, the featured measure usually as dark black line, one or two comparative or target measures of performance (optional), and from two to five ranges shown as background fills along the quantitative scale to declare the featured measure’s qualitative state like bad, satisfactory, and good (optional) All use the same quantitative scale. Flex component with source code from Agile UI. Google charts version from Dealer Diagnostics. Excel version from Excel User.

Correction on 2010 March 18: The image of the dashboard above is from Robert Allison. Get the SAS/Graph code to create the dashboard.]

Republished from Visual Business Intelligence. Monday, February 4th, 2008 at 2:54 pm.

Image above from Stephen Few’s Information Dashboard Design book seen here.
View PDF format Bullet Graph Design Specification from Stephen Few on the bullet graph. He’s got other useful information design writeups in his Library.

When I designed the bullet graph back in 2005, I did it to solve a particular problem related to dashboard displays. The graphical widgets that software vendors were providing to display single measures, such as year-to-date sales revenue, consisted mostly of circular gauges and meters, which suffered from several problems. Most of them conveyed too little information, did so unclearly, and wasted a great deal of space on the screen. The bullet graph was my alternative, which was designed to convey a rich story clearly in little space.

Bullet Graph Description

Since their introduction, a number of dashboard vendors now support bullet graphs, either as a predesigned display widget or as a display that can be easily constructed using their design tools. Now that bullet graphs are being used a great deal, they are being put to the test, and best practices are being developed to use them effectively.

One challenge that is faced by any graphical display of a single measure compared to another, such as a target, is the fact that the target usually functions as a point that the measure should reach or exceed, such as a sales target, but sometimes it functions as a point that the measure should stay below, such as an expense target. Here is a series of bullet graphs, which are designed in the typical manner:

Bullet Graphs for Not-to-Exceed Targets 1.jpg

Two of the measures—expenses and defects—work the opposite of the others in that the goal is to remain below the target. The background fill colors on these bullet graphs, which vary from dark gray to indicate “poor performance” through to the lightest gray to indicate “good performance,” are arranged from poor on the left to good on the right for revenue, average order size, and new customers, but in reverse for expenses and defects. The reversed sequence serves as a visual cue that expenses and defects should remain below the target. This cue, however, is not strong. It would be useful if something that stood out more signaled this difference.

We might be tempted to replace the varying intensities of a single color—in this case varying intensities of gray—with distinct hues, to make the reversal of the qualitative scale more apparent, such as by using the traditional traffic light colors that are so popular on dashboards.

Bullet Graphs for Not-to-Exceed Targets 2.jpg

This does cause expenses and defects to more clearly stand out as different from the other measures, but at what cost? Even if we ignore the fact that most people who are colorblind (10% of males and 1% of females) cannot distinguish green and red, we are still left with an overuse of color that makes the dashboard appear cluttered and visually overwhelming, as well as a dramatically weakened ability to use color to draw viewers’ eyes to particular areas that need attention. Is there a better way to make certain bullet graphs look different without introducing other more troubling problems?

Here’s a suggestion: not only reverse the sequence of the qualitative scale, but also the direction of the quantitative scale. Using expenses as an example, the quantitative scale could run from 0 at the right of the bullet graph with values increasing leftwards. The bar that encodes the expense measure would then also run from the right edge of the bullet graph leftwards. The bar running from right to left serves as a stronger visual cue that the target works differently, as you can see below:

Bullet Graphs for Not-to-Exceed Targets 3.jpg

Although it is not conventional for a quantitative scale to run from right to left, except in the case of negative values, this is easy to read and the unconventionality actually causes it to pop out more clearly. In fact, expenses and manufacturing defects are measures that we can easily think of as negative values (for example, expenses reduce profit and defects reduce manufacturing productivity).

I would like to encourage all the vendors out there that support bullet graphs to support this functionality and for those who use them to take advantage of it.

Take care,

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Figuring Autoworkers’ Pay (NY Times)

Monday, December 15th, 2008

[Editor's note: This graphic from the New York Times shows how the crux of the auto bailout is not a labor pricing issue but a core a supply and demand issue. The labor costs of a new car is only 10% of the price of a car and any remaining "labor" cost difference after recent union concessions is due, like any large company, to supporting prior retirees, a cost that newer companies have yet to experience (Diane Rehm Show, 15 Dec 2008). If the Big Three could make cars that were smart, efficient, reliable, and had resale value, now that's the ticket. Besides, it's not like the Heritage cadre were crying foul over big financial firm bailouts when those white collar workers certainly make more than the average American worker. Thanks Laris!]

Republished from the New York Times. By DAVID LEONHARDT. Published: December 9, 2008

Economic Scene
$73 an Hour: Adding It Up

That figure — repeated on television and in newspapers as the average pay of a Big Three autoworker — has become a big symbol in the fight over what should happen to Detroit. To critics, it is a neat encapsulation of everything that’s wrong with bloated car companies and their entitled workers.

To the Big Three’s defenders, meanwhile, the number has become proof positive that autoworkers are being unfairly blamed for Detroit’s decline. “We’ve heard this garbage about 73 bucks an hour,” Senator Bob Casey, a Pennsylvania Democrat, said last week. “It’s a total lie. I think some people have perpetrated that deliberately, in a calculated way, to mislead the American people about what we’re doing here.”

So what is the reality behind the number? Detroit’s defenders are right that the number is basically wrong. Big Three workers aren’t making anything close to $73 an hour (which would translate to about $150,000 a year).

But the defenders are not right to suggest, as many have, that Detroit has solved its wage problem. General Motors, Ford and Chrysler workers make significantly more than their counterparts at Toyota, Honda and Nissan plants in this country. Last year’s concessions by the United Automobile Workers, which mostly apply to new workers, will not change that anytime soon.

And yet the main problem facing Detroit, overwhelmingly, is not the pay gap. That’s unfortunate because fixing the pay gap would be fairly straightforward.

The real problem is that many people don’t want to buy the cars that Detroit makes. Fixing this problem won’t be nearly so easy.

The success of any bailout is probably going to come down to Washington’s willingness to acknowledge as much.

Let’s start with the numbers. The $73-an-hour figure comes from the car companies themselves. As part of their public relations strategy during labor negotiations, the companies put out various charts and reports explaining what they paid their workers. Wall Street analysts have done similar calculations.

The calculations show, accurately enough, that for every hour a unionized worker puts in, one of the Big Three really does spend about $73 on compensation. So the number isn’t made up. But it is the combination of three very different categories.

The first category is simply cash payments, which is what many people imagine when they hear the word “compensation.” It includes wages, overtime and vacation pay, and comes to about $40 an hour. (The numbers vary a bit by company and year. That’s why $73 is sometimes $70 or $77.)

The second category is fringe benefits, like health insurance and pensions. These benefits have real value, even if they don’t show up on a weekly paycheck. At the Big Three, the benefits amount to $15 an hour or so.

Add the two together, and you get the true hourly compensation of Detroit’s unionized work force: roughly $55 an hour. It’s a little more than twice as much as the typical American worker makes, benefits included. The more relevant comparison, though, is probably to Honda’s or Toyota’s (nonunionized) workers. They make in the neighborhood of $45 an hour, and most of the gap stems from their less generous benefits.

The third category is the cost of benefits for retirees. These are essentially fixed costs that have no relation to how many vehicles the companies make. But they are a real cost, so the companies add them into the mix — dividing those costs by the total hours of the current work force, to get a figure of $15 or so — and end up at roughly $70 an hour.

The crucial point, though, is this $15 isn’t mainly a reflection of how generous the retiree benefits are. It’s a reflection of how many retirees there are. The Big Three built up a huge pool of retirees long before Honda and Toyota opened plants in this country. You’d never know this by looking at the graphic behind Wolf Blitzer on CNN last week, contrasting the “$73/hour” pay of Detroit’s workers with the “up to $48/hour” pay of workers at the Japanese companies.

These retirees make up arguably Detroit’s best case for a bailout. The Big Three and the U.A.W. had the bad luck of helping to create the middle class in a country where individual companies — as opposed to all of society — must shoulder much of the burden of paying for retirement.

So here’s a little experiment. Imagine that a Congressional bailout effectively pays for $10 an hour of the retiree benefits. That’s roughly the gap between the Big Three’s retiree costs and those of the Japanese-owned plants in this country. Imagine, also, that the U.A.W. agrees to reduce pay and benefits for current workers to $45 an hour — the same as at Honda and Toyota.

Do you know how much that would reduce the cost of producing a Big Three vehicle? Only about $800.

That’s because labor costs, for all the attention they have been receiving, make up only about 10 percent of the cost of making a vehicle. An extra $800 per vehicle would certainly help Detroit, but the Big Three already often sell their cars for about $2,500 less than equivalent cars from Japanese companies, analysts at the International Motor Vehicle Program say. Even so, many Americans no longer want to own the cars being made by General Motors, Ford and Chrysler.

My own family’s story isn’t especially unusual. For decades, my grandparents bought American and only American. In their apartment, they still have a framed photo of the 1933 Oldsmobile that my grandfather’s family drove when he was a teenager. In the photo, his father stands proudly on the car’s running board.

By the 1970s, though, my grandfather became so sick of the problems with his American cars that he vowed never to buy another one. He hasn’t.

Detroit’s defenders, from top executives on down, insist that they have finally learned their lesson. They say a comeback is just around the corner. But they said the same thing at the start of this decade — and the start of the last one and the one before that. All the while, their market share has kept on falling.

There is good reason to keep G.M. and Chrysler from collapsing in 2009. (Ford is in slightly better shape.) The economy is in the worst recession in a generation. You can think of the Detroit bailout as a relatively cost-effective form of stimulus. It’s often cheaper to keep workers in their jobs than to create new jobs.

But Congress and the Obama administration shouldn’t fool themselves into thinking that they can preserve the Big Three in anything like their current form. Very soon, they need to shrink to a size that reflects the American public’s collective judgment about the quality of their products.

It’s a sad story, in many ways. But it can’t really be undone at this point. If we had wanted to preserve the Big Three, we would have bought more of their cars.