Analyzing competition is one of the key aspects of running a business. In this article, learn how to use Excel’s scatter plots to understand competition.
Recently, Kaiser at Junk Charts pointed to a very effective business chart that shows the dynamics of competitive land scape with ease.
The chart shown aside originally appeared in Asymco, shows how mobile handset market has changed between 2007 & 2010.
What is so special about this chart?
I like this type of chart because it clearly tells the story of what happened in mobile handset market between 2007 and 2010. It shows how then leader, Nokia, kept loosing profit share despite a tiny loss in market share. It shows how new entrants like Apple have eroded the profit share for others. [related: good charts tell stories]
The chart instantly lets me ask important questions like, “So what did Nokia do wrong?”, “How come RIM is also in the same league as Apple (ie both market share and profit share went up) ?” etc. and explore for answers.
And that is what a chart should do. It should present a story and poke our curiosity to ask questions (or address problems).
How to construct similar chart in Excel?
Here is how you can construct similar business chart in excel.
Step 1: Get your data
In case of analytical charts like this, getting correct data is all important. For the sake of example, we will use the same variables – Market Share & Profit Share for 4 fictitious products – A,B,C & D. The data is shown below:
Step 2: Re-arrange the data, so we get first and last values
This is very simple. Use cell references to extract the data for just first and last periods. Now make starting values as zero and calculate ending values. Something like this:
Step 3: Make a scatter plot
Select the data and make a scatter plot. When you are done, it should look something like this:
Step 4: Format the chart
Do the following to format the chart:
- Add lines to scatter plot so that starting and end point are connected
- Set arrow symbol as the end-point style for these lines (new feature in Excel 2007 and above)
- Remove grid lines and legend
- Add data labels to either starting or end points alone.
- Add axis labels, position them accordingly
- Make axis and labels subtle.
- Add a descriptive chart title
And you are done. The chart should look something like this:
Bonus Step: Making a scatter plot of absolute values
As you can see, the above chart only shows changes in market share and profit share of products between Q1-2008 and Q2-2010. But a more descriptive option would be to show absolute position of each product at both times.
Like this:
To make this chart, all the steps are same as above, just change your data to starting and end points, not the calculated ones.
Download Competition Analysis Chart Templates:
I have prepared a simple excel chart template to help you create similar charts on your own. Click below links to download.
You can see the chart construction steps in the downloaded workbook.
What do you think about this chart?
As I mentioned I really liked how this chart lays out the dynamics of market place without complicating or animating anything. I think it is both simple and elegant [related: keep your charts simple]
What do you think? Please share your opinion and ideas thru comments. Also, tell us how you would have plotted same data?
More Excel Charts for Analysis:
Excel charts are powerful visual tools for analysis and exploration. We have posted several useful chart templates & ideas on chandoo.org. Please visit these pages for more resources on charting & analytics.
18 Responses to “Best Charts to Compare Actual Values with Targets – What is your take?”
Great post. I can't vote, though, because the answer I want to put down is "it depends". As with all visualisations, you've got to take into account your audience, your purpose, technical skills, where it will be viewed, etc.
I'm with Andy: It depends. Some I would use, some I might use, some I won't touch with a barge pole.
Naturally I have comments 🙂
The dial gauge, though familiar, is less easy to read than a linear type of chart (thermometer or bullet). It's really no better than the traffic lights, because all it can really tell you is which category the point falls in: red, yellow, or green.
By the same token, pie charts are so familiar, people don't know they can't read them. Remember how long it takes kids to learn to read an analog clock?
Bullet charts don't show trends.
With any of the charts that have a filled component and a marker or ine component, it makes more sense to use the filled component (area/ column) for target, and the lines or markers for actual.
[...] Best Charts to Compare Actual values with Targets (or Budgets … [...]
I voted for #6 even though I agree with the other comments that it depends.
The majority of the votes are for the #2, thermometer chart. I still have yet to understand what happens when you are above plan/goal, which was brought up in yesterday's post.
Also, I agree with Jon in that it would be better to flip the series and make the filled part the target or goal and the line or marker the actual.
I am also a fan of using text when appropriate if the data is among other metrics in a type of dashboard. Calling it out by saying actual and % achievement is a good option.
Another "it depends" vote. Are you just looking at one or are you comparing a number of targets with actuals? You didn't include a text box. The problem with sentences is that they can get lost in a page of gray text. A text box can call attention to the numbers and line them up effectively.
I'm with Jon: "Some I would use, some I might use, some I won’t touch with a barge pole" and I'm surprised that some of your readers voted for the last group.
Jon says:
With any of the charts that have a filled component and a marker or line component, it makes more sense to use the filled component (area/ column) for target, and the lines or markers for actual.
Why does this make more sense? I like 6 the way it is, although I would use a heavy dash for the plan/target marker.
"It depends" is also my take. What I usually try to drill into my clients dashboard design is the fu ndamental difference between spot results (am I on target for this month) and long term trends.. I always try to create 3 different set of graphs to represent real perormance:
- spot results vs objectives
- cumulative results vs objectives
- long-term trend (moving average) mostly) to see where we're going
[...] Best Charts to Compare Actual Values with Targets – What is your take? (tags: excel charts) [...]
[...] Related: Charting Principles, How to compare actual values with budgets [...]
[...] Excel Charting Alternatives to compare values [...]
Jon says:
With any of the charts that have a filled component and a marker or line component, it makes more sense to use the filled component (area/ column) for target, and the lines or markers for actual.
Why does this make more sense? I like 6 the way it is, although I would use a heavy dash for the plan/target marker.
I totally agree, Bob. I would normally favour a line for the target and a column for the actual, you can see quite easily then which columns break through the line, then.
[...] best charts to compare actual values with targets — den Status mal anders zeigen, z. B. als Tacho [...]
Thermometer charts: "Not appropriate when actual values exceed targets" - this is easily solved by making the "mercury" portion a different color from the border, then you can clearly see where the expected range ends and the actual values keep going.
People seem to knock gauges quite a bit in dashboarding, but trying to show comparison of realtime data between operating sites and targets for each site can easily be done with a bank of gauges that have the optimal operating points at 12 o'clock.
The human eye is great at pattern stripping, and any deviation of a gauge from the expected 12 position will quickly register with an operator and attract his attention. Using a colour background, or meter edge, will also indicate the sensitivity of a particular site.
[…] Best charts to compare actual with target values […]
[…] Best charts to compare actual with target values […]
[…] work laptop I have a favorites folder just dedicated to Excel charts. Its got things like “Best Charts to Compare Actuals vs Targets” and “Best charts to show progress“. I love me some charts […]
I am wondering how will the plotting work, for some of the targets which may have been achieved before time. E.g. for the month of Jul the target was 226 and the actual was 219. So the chart will show a deficit in meeting the target by 7 points but what if this 7 may have been completed earlier in month of June. So ideally it not a deficit.