Photo by Adeolu Eletu on Unsplash
Why managers do not understand charts
or an open letter to all business analysts
9. 9. 2019
olga
3594 Views
I was meeting my friend and mentee Jan for a beer.
He was late.
I was worried.
Today he had his first presentation to management after he joined FP&A department in XXX corporation.
Finally, he showed up. Sweating, angry and almost crying.
– They are all stupid! – Jan declared instead of a greeting.
– Who is stupid? – I asked carefully.
– Managers!
– Like, all of them? – I smiled trying to ease the situation. It didn’t work.
– They just don’t understand the charts at all – Jan barked – From tomorrow on, everything will be in the tables only! Let them choke!
– Well, wait, do not get agitated. What did they not understand?
– They didn’t understand Waterfall!
– Waterfall is a good chart – I started in a mentoring tone – it helps split the change into individual components. Show it to me!
Jan set the beer aside. He pulled out his new laptop and proudly pointed at the monitor: “Here!”
A terrible beast crawled out. It looked something like this:
– Why is it so striped? – I asked, trying not to show my confusion.
– What do you mean “why?” – Jan was indignant – don’t you see the legend? Each unit appears in the chart with its own color.
The situation was heating up. Jan was clearly upset. The Waterfall beast was terrible and incomprehensible. But I still took a chance:
– What did you want to say with this chart?
– What? Can’t you see?!
– I don’t see yet. But you will show me, right? – and the sweetest smile, I was capable of.
– Oh, Olga Olga… you’ve spent ten years in financial analysis and still do not get it! Well, look here. Salaries are mainly of service workers. Third division is air conditioning. It turns out that the third division has a completely unprofitable servicing. Why do we need to service these air conditioners ourselves, if their repair and maintenance can be outsourced to a local company? Profit will be much higher.
“Have you understood all of it from this one chart?!” Well, you are an incredible brainy! I breathed out with a relief.
So, here’s my open letter to all business analysts:
My friends,
Visualizing data is like mushroom picking.
We go to the forest. We look under one tree … under another tree. Under some of them we find mushrooms, under others – we don’t. We collect mushrooms into a basket, bring the basket home to our grandmother and say: “Granny, please, make us mushroom soup!”
That’s how it usually happens.
But imagine. You go to the forest. You do not pick any mushrooms. You only take pictures of the forest. From far away. Bring these photos to your grandmother and say: “Look how many mushrooms are there! Don’t you see?”. And you do not even mention mushroom soup.
Sounds absurd?
After all, that is exactly what we are doing. We bring a forest of data to our managers. We do not pick interesting insights from it. We just dump all the data into PowerPoint slide. Colorful and scary. And we do not even mention recommendations.
Ideal managers do not exist. But in most of the cases, they do not lack intelligence. We just show them the bad charts.
Jan and I tamed the terrible beast in the end. We have picked only the right insights. Now it looks like this:
