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How colors help in optimizing business dashboards

To a decision maker, raw information is only valuable when presented in an easily understood form. When 90% of the information transmitted to our brains is visual, a graphical business dashboard can go a long way in assisting the process of business intelligence. This piece explores how colors are a vital part of dashboard optimization.

The Science of Using Colors in Data Visualization

Although color and its perception are subjective to everyone, effective data visualization has some basic rules. Too much color can distract from your data and leave the audience confused. In dashboard optimization, one must strike the right balance. The color you select must complement your data.

Hue, luminance and saturation are the three most important properties when choosing colors to brighten up your business dashboard. For instance, sequential data should be represented by colors at varying saturation levels. Highly saturated colors are more vivid and are better associated with larger numbers. Color saturation can decrease as the values decrease.

Another facet of data visualization is contrasting hues. Shades of the same color can be used for emphasis. Sales figures of two products can be compared easily using different hues. When the comparison is made over time (a percentage increase, for example), data becomes sequential and saturation can be brought into the mix as well.

Colors can be used with qualitative data such as names and addresses as well. A great business dashboard mixes in qualitative info to help give context to the numbers. The key is to keep it clean. Each qualitative data point needs a separate color for differentiation. If you have a lot of qualitative information, put it on separate pages to avoid clutter. This will go a long way towards dashboard optimization.

Psychology Matters

Colors invoke emotions in us. Use this fact wisely in your data visualization process. For instance, colors such as green, gold & blue symbolize progress and security. They have the effect of calming people. Combinations of these should be used when making a positive point, especially in marketing & finance. On the other hand, using too much red will make users anxious when looking at your business dashboard.

The second psychological tip to dashboard optimization is: reinforces the branding. Break the client logo into color sections and use that to build a palette. Hints of the brand color in the background will make your audience trust you more.

Finally, know your audience. Take color blindness as an example. If presenting data to someone who is color-blind, it is best to avoid combinations of green and red. Tools such as Tableau can help you choose the right palette for color perception deficiencies. This attention to detail shows your audience you care about them.

Technology has vastly improved the storage and processing of data, but business intelligence is driven by context. Business dashboards help provide that context to leaders through effective data visualization, which in turn depends on how effectively colors are used in dashboard optimization.

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