Discover The Power Of Gauge Charts: Definition, Best Practices & Examples
Table of Contents
4) How to Create A Gauge Chart
Data visualization is a fundamental step for successful data analysis. By giving your information a visual context, you make it more understandable. Making your insights more focused will also help you identify rafts of valuable new trends, patterns, or problems.
There are many chart types available in today’s digital realm and each one of them plays an important role in a professional BI dashboard. To choose the perfect mix of visualizations, you need to know exactly what story you want to tell with your data and what visual tool will be the best to do so.
In this essential guide, we will introduce you to one of the most straightforward yet potentially powerful types of data visualization, the gauge chart.
If you are interested in learning how this type of chart can boost your data storytelling, then you've come to the right place.
Here, we will cover every aspect of gauge charts, from the definition, their benefits, steps to create them, and a list of practical examples that will help you visualize how this chart type works in real business scenarios.
Let’s start with the official definition.
What Is a Gauge Chart?
A gauge chart, also known as dial or speedometer chart, is a data visualization type used to display a single value of data in a quantitative way. By using a colored data range, gauge charts enable users to understand the progress of a KPI against a set target.
The advantage of this chart lies in the fact that it’s easy to interpret. It uses various colors to divide a scale into segments that represent different values of the same metric, and it uses a needle to point at a certain value over the pivot point. In most cases, these colors usually show the maximum, the medium, and the minimum value of the data being displayed in order to quickly visualize its performance based on a trend.
The gauge chart is a suitable chart for executive dashboards. And it proves particularly useful in situations where the expected value of the data is already known, this way business departments, managers, or employees can easily understand where they stand with that specific metric just by looking at the chart.
Benefits Of Using Gauge Charts
Gauge charts are very effective graphics that manage to capture the attention of an audience fast and efficiently. To put the power of this style of visualization into perspective here we leave you some of the main business benefits:
- Easy to create: The fact that this chart type is mostly used to display one insight at a time, makes it a straightforward visualization. With the right online data visualization tools, you can create a professional chart with just a few clicks. We will go a bit deeper into this point further in the post.
- User-friendly: One of the aspects that makes gauge charts popular is that people are usually familiar with them thanks to their resemblance to a car speedometer or a temperature indicator. This makes them a great chart to display performance-based metrics and show them to non-technical viewers that will be able to easily understand the value that is being displayed in the chart.
- Easy to interpret: Following the user-friendly interface of this kind of chart is that they are quite easy to interpret. The sequence of colors, usually from green to red, makes them intuitive and immediate to understand. Business executives use them because they are able to transmit important insights simply and clearly.
When To Use A Gauge Chart
Because gauge charts are easy to create and understand, they can be applied in many business scenarios. However, it is important to consider that due to the fact that this kind of visualization is mostly used to display one single value, they are not the best choice if you want to extract deeper insights from your data. For this reason, it is important to identify the best scenarios in which your business can benefit from this chart type, here we tell you some of them:
- For progressive information: If you have a linear visualization and you want to display how it changes, a gauge graph is the way to go. You can monitor your metrics based on a time period to understand how the values changed over time and see if you accomplish your original goal. You can also compare the results or outcome to a different time period, for example, a year, and see if there were any improvements.
- For target metrics: Another popular use of this chart is for target metrics. Using them in this context will help you understand the performance of a specific KPI based on a target you pre-defined. For example, if you want to visualize sales KPIs that track the total revenue for a specific period based on a target, an interactive gauge chart can easily display the percentage of the goal that has been achieved until a specific period of time.
- For project progress or deadlines: Gauge charts tracking project progress or deadlines play an important role in a business dashboard. The chart is used in this particular scenario by taking all the tasks and deadlines involved in a project and reflecting them in a percentage to understand if you are late or advanced to meet the deadlines and completion of the project.
- For comparing two datasets: Another popular use of this visualization is to compare two datasets. This can either be done in the same chart using multiple needles to differentiate the progress of the two values or by using two different charts displaying the same value with a different benchmark. For example, you can compare the revenues of one month with the total revenues based on a yearly target. This way you could understand how much each month contributes to the final goal.
How to Create A Gauge Chart
By now, we've covered the definition of gauge charts and a few benefits and scenarios in which your business could take advantage of them. Now it's time to start considering what steps are important to create a successful gauge graph that will benefit your data storytelling process.
1. Define your metrics
The first step is to define the metrics you’ll want to visualize. As we just mentioned recently, due to their simplistic nature, gauge charts cannot be understood without context and are not useful if you want to extract deeper insights from your data. Additionally, they take more space than an average number chart in a business KPI dashboard, therefore you need to be careful and smart when picking the metrics you’ll want to visualize with this style of chart. Make sure you choose KPIs that are not complex or wide and stick with performance metrics that will give extra value to your overall report.
After defining what metrics you’ll use, you need to come up with a scale to define the range that will measure how the data value changes over time. The range can be either a maximum value, or divided into thresholds of a low, medium, and high outcome. This is usually done with the colors red, yellow, and green as they represent positive or negative outcomes.
2. Choose the right type of chart
Gauge charts come in different shapes and forms depending on what kind of visualization you want to represent. We already mentioned the different scenarios in which your business can benefit from this type of visualization. For this reason, after you pick the KPIs metrics you’ll visualize you need to pick the best style of gauge chart for them. Here we leave you a quick definition of 3 commonly used types:
- Speedometer: One of the most popular types is the speedometer. Its name comes from the chart that measures a car’s speed and it is often used if you want to compare longer ranges of a metric thanks to its circular shape. This kind of gauge chart can use one or multiple needles to point at a certain value based on a goal or benchmark.
- Linear Gauge Chart: The linear chart is used to indicate a numeric data value on a linear scale. The values are usually displayed in a vertical or horizontal bar with colors that differentiate the ranges of data alongside a pointer to indicate the data value on the scale.
- Angular Gauge Chart: The angular chart is the same as the speedometer chart but it displays only half of the circle. It is often used to display a range that is limited or when you want to visualize the success of a visualization based on a positive or negative outcome.
3. Pick the right colors
It has been proven over and over that humans are more likely to take in new information if it’s in a visual format. In fact, studies say that the human brain processes visuals 60.000 times faster than text or numbers. This is because visuals are more intuitive and more likely to stay in your memory for a longer time.
This makes picking the colors for your gauge charts a fundamental step in the design process. As we said, this type of chart is often used to display performance metrics, therefore colors are usually associated with poor, satisfactory, and good results. For example, the green color will always be associated with excellent or high performance, yellow can mean average or normal, and red can mean alarming or bad outcomes.
On the other hand, if you are using gauge charts that just aim to show the progress of a metric you need to make sure you pick a color that is easy on the eyes but that still pops up and highlights the graph.
4. Use professional tools
Our final tip to help you create a successful gauge chart is to use a tool that will allow you to create a professional organizational chart easily and efficiently. Since this style of chart performs better when placed on a business dashboard, it might not be the smartest or fastest choice to use excel to create them. Instead, you should invest in a tool that will give you the freedom to create different charts with colors and shapes that will enable your data to tell its own story.
datapine is a business intelligence software that offers an interactive and user-friendly dashboard creator. Thanks to its drag & drop feature you can create professional gauge charts with just a few clicks. Additionally, the dashboard tool gives you full control over the design of your visualizations, this way you can pick the size and colors of your charts so that they can match your brand identity and complement your other metrics for further analysis.
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Top 14 Gauge Chart Examples
To put theory into a living, breathing perspective, we’re going to present you with a definitive run of 14 gauge chart examples in different organizational contexts. These dynamic visuals will help you understand how your organization can progress with this valuable chart style.
Let’s dive in.
1. Sales Target Growth
Our first gauge chart example is a high-level marketing KPI measuring sales target and growth. As we mentioned before, this type of chart can be used to compare the same value over a different benchmark. In this example, we can see two gauges that compare the sales performance with the previous month as well as to a set target. By tracking these metrics on a monthly basis and setting realistic sales targets, businesses can ensure stable growth and viable revenue.
2. Hospital Readmission Rate
Our next example created with a gauge chart generator is the hospital readmission rate, one of the most important healthcare KPIs to track. This metric aims to monitor what percentage of patients returned to the hospital within a short period of time after being released. A gauge chart is useful here since it allows hospital managers to quickly understand if the readmission rate is high or low. It is important to consider that this chart alone would not allow for further conclusions about why the readmission rate could be high. In order to get this information, it would be necessary to dig deeper into other aspects like hospital management, materials available, quality of the staff, and others.
3. Maintenance Cost
This manufacturing KPI aims to monitor the maintenance costs of a business. The chart here works as a type of alert for users to quickly understand how the costs are going. In this case, we see a message saying that the maintenance costs are above the average, which means further action needs to be taken in order to avoid budgeting issues. By keeping track of this metric, you can make sure you optimize your costs over time and save money for other future investments in your equipment.
4. Gross Profit Margin
The gross profit margin is a key metric to include in a professional financial dashboard. This KPI aims to track the total revenue minus the cost of goods sold or services delivered and divide it by your total sales revenue. To put it simply, this metric displays the percentage of total sales revenue that you get to keep after accounting for all the costs associated with production and labor. By tracking the gross profit margin, you can understand how effective the production of your company is: a higher gross profit means a higher income. In this case, the gauge chart aims to do just that, by looking at this percentage, senior executives can understand at a first glance the financial health of the company.
5. Net Promoter Score
Moving on with our list of gauge examples we have a customer service KPI tracking the net promoter score. This metric is a great indicator for a customer service report since it aims to evaluate customer loyalty and satisfaction. In this case, the chart displays the results to a simple question: to grade, from 0 to 10, how likely they would recommend the brand. The results are displayed in a speedometer shape where the needle points to the current NPS score. Paired with this, the color green represents the target range from 40-100 which means a positive net promoter score, yellow represents a medium score, and red represents a really negative NPS lower than -20.
6. Overall Project Progress IT
As we mentioned before, a popular use case for gauge charts is to track project progress. This metric aims to monitor how much of a project has been completed based on a target date on which all the work needs to be completed. By looking at this chart, anyone in the team can understand if the schedule is going as planned. Colors can also be used in this type of scenario, for example, if the project were mildly delayed it could use yellow, and if it’s strongly delayed it could use red.
7. Net Profit Margin
As one of your key profitability markers, keeping a keen eye on your Net Profit Margin is vital. This savvy gauge visual example will give you an ongoing means of measuring your net profit to see if your company is on track in terms of commercial growth and fiscal health. If you notice a drop in your net profit margin, you can get to the root of the issue (e.g., fulfillment inefficiencies, weak marketing campaigns, or customer satisfaction issues) and nip it in the bud before it gets out of control.
8. Operating Expense Ratio (OER)
This digestible gauge visualization offers a clear-cut means of tracking your overall operational efficiency. With an easy-to-follow chart and a real-time ratio percentage calculation, this will give you an ongoing view of whether your company is scalable based on your operating expenses. Keeping track of this OER visual will also ensure your operating expenses are as efficient as possible, which, in turn, could attract potentially valuable investors.
9. Quick Ratio / Acid Test
Liquidity is a critical component of any organization’s fiscal health, and this gauge-based KPI gives you a clear-cut breakdown of your ratios over a 12-month timeframe. Here, you can set a liquidity benchmark and take measures to increase it over time. Having this KPI at your disposal will help you keep your fiscal health on track while offering invaluable insights that will empower you to scale your company steadily over time.
10. Talent Satisfaction
In addition to your customers, your talent is the beating heart of your organization. Without engaging, motivated, and satisfied staff, you cannot compete on the commercial battlefield. An NPS for your talent, this priceless HR dashboard KPI will give you all the basic intelligence you need to ensure your internal talent remains happy and engaged in the company. If you notice troughs in your score, you can take strategic measures to fix the issue, such as offering flexible working terms, holding focus groups to gather feedback, offering better incentives, and providing training or development opportunities.
11. Customer Effort Score
You need to meet your customers' needs consistently to thrive in the modern age. This focused visualization will show you exactly how easy or difficult it is for a customer to find what they’re looking for, interact with a service agent, or complete a task. Using this will give you invaluable feedback on your customer experience (CX) offerings while giving you a marker from which to improve key aspects of your consumer journey, service levels, and messaging.
12. Perfect Order Rate
An essential logistics dashboard graph, the perfect order rate has a direct correlation with your fulfillment or supply chain efficiency. Using this visualization, you can easily track the number of orders that you shipped on time, with success. The higher or healthier the perfect order rate, the more your company will thrive. If you notice dwindling numbers, you can nip the issue in the bud, saving a great deal of money as well as your brand reputation in the long run.
13. Flesch Reading Ease Test
Whether it’s sales, marketing, or customer service content (these days, these branches of communication are one and the same), your messaging must be clear, concise, and easy to read. If your content is awkward and filled with technical jargon, it’s unlikely to perform well. This vital visual will tell you exactly how easy or tough your audience will find it to read your content. If your score exceeds your reading test benchmark, you can rework it until it’s as conversational, engaging, and accessible as possible. Add this graph to your content reports, and your marketing or communications return or investment (ROI) will start to soar.
14. Customer Satisfaction Score
Circling back to your customers for a moment, this linear gauge chart template is incredibly valuable, as it offers a direct visual representation of how people perceive your service over a given period. With five clear-cut ratings to work with, you can calculate exactly how you manage to resolve consumer issues and meet your customers’ needs. Not only is this excellent for strategic customer experience planning, but it also offers a prime opportunity to gain priceless feedback that will significantly improve your service levels.
The Cons & Limitations Of Gauge Charts
While gauge charts are incredibly useful and offer a wealth of BI-boosting benefits, there are some limitations that you should know about.
By understanding these inherent limitations, it’s possible to utilize gauge-style charts using a balanced approach. By doing so, your analytical strategy will earn you the best possible ROI and allow you to scale the organization seamlessly.
- Visual and informational space
When you’re working with a dashboard, it’s important to gain a panoramic view of an entire process, function, or departmental initiative (marketing campaign success, sales revenue, shipping success process, etc.).
While gauge charts are a vital part of any dashboard, it's crucial to understand that these visualizations can take up a great deal of informational space. That said, it’s important to use gauge-style charts sparingly as a valuable part of an analytical tool or dashboard. Combined with other charts and visuals, gauge graphs really come into their own. But using them alone will only give you slices of the informational pie (albeit, powerful ones).
- Wider context
Following on from our last point: as gauge charts typically display a dial and a numeric calculation or percentage, they don’t offer information on a variety of variables.
These charts are designed to offer detailed and actionable information on a very specific piece of information, which means they are limited when showing the wider context of things. For example, a gauge-style chart is excellent at offering an actionable glance of customer satisfaction levels, but to compare it to other timelines, you would need to look at a mix of additional visualizations. Again, it’s worth remembering that gauge charts are powerful cogs in the analytical machine rather than the machine itself.
- Not always fully accessible
While gauge charts are incredibly digestible and offer deep-dive information on a range of different operational functions, their linear traffic light-style designs aren’t always accessible to all users.
If a user is colorblind or neurodivergent, they could find the dial charts design difficult to interpret. So, before you add them to your analytical strategy or dashboard, it’s important to check that all of your staff or users find them comfortable to work with. If this isn’t the case, you should make the appropriate reasonable adjustments.
Reminder: These focused visuals are vital to the intelligence of any modern business. Take heed of these cons or limitations and mix them with some data visualization techniques, and you will reap a wealth of rewards in the long run.
The Unrivaled Value of Visual Storytelling
By working with a balanced mix of gauge charts and accompanying visual KPIs, you will paint a vivid picture that will open up a wealth of business-boosting insights.
The power of visual storytelling is unrivaled, and by presenting your company’s most valuable information in a way that follows a compelling narrative, you will spot trends or patterns you never thought existed.
Another key component of visual storytelling is the fact that it brings your data to life. Adding gauge charts into the storytelling mix will help you present your discoveries in a way that’s engaging and persuasive, helping you get the right people on board when it matters most.
The intuitive and digestible nature of visual storytelling also means that most people within the organization can use dashboard insights to their advantage, accelerating the success of every single department in the process. And when that happens, you will see steady and significant organizational growth.
When it comes to unifying every department of your company and optimizing the abilities of your internal talent, visual storytelling is the way forward.
"Data are just summaries of thousands of stories—tell a few of those stories to help make the data meaningful."—Dan Heath, bestselling author, and analytics expert
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Key Takeaways of Gauge Charts
As we reach the end of this practical guide, we expect you to be more aware of how gauge charts can add extra value to your data storytelling. We went through its main benefits, saw some tips on how to use them and build them, and gave you a list of quality real-world examples in which you can apply this type of visualization.
Gauge-style charts will help you bring vital components of your analytical strategy to life, giving you a fresh perspective on the way you run your organization. These visualizations can work alongside complementary insights to improve decision-making, enhance communication, streamline operational processes, and boost motivation or engagement.
But keep in mind that to extract truly actionable insights from your metrics, your information must be presented in a way that tells a logical and compelling story. Your dashboards need to be as interactive and complete as possible with a varied mix of visualizations that will enable anyone in your organization to work with the data at hand. Gauge graphs alone will be nothing without other metrics to look at the whole picture. While that is the case, your analytics strategy and activities will not be the same without them being firmly in the visual mix.
If you are ready to start creating stunning gauge charts with the help of professional dashboarding software, then try our 14-day trial completely free and start benefiting from quality data visualizations today. The power is in your hands.