Why stacked line charts are useful

Stacked line charts

Stacked line charts are a great and yet simple tool. Here is why. We often run into a situation where we need to analyze data with different units of measure. Think about  a classic but yet simple situation: Vital company data such as revenue, margin % and expenses is used to obtain insights about the past and current performance . One could dismiss this as an easy task and simply review a standard table. But raw data is really tough to analyze. Detecting trends and patterns quickly is almost impossible. Especially with regular data sets that span multiple organizational units

Analysis

Raw data is hard to analyze. Even simple data sets as this one here.

The other option would be to stick the data into a traditional line chart. But this won’t work in many cases for two obvious reasons:

  • The units of measure are different (Revenue ($), Margin (%), Headcount (#), Volume (#), etc..)
  • The units of measure have large differences (example: Revenue is measured in millions, travel cost in thousands)

Both cases result in a pretty much useless chart. You can see a fine example right below:

bad line chart

An almost useless chart - What are the margins again?

For data sets containing just two different units of measure, we could alternatively consider a dual axis graph. But I personally find them distracting and many casual users get confused. This is where stacked line charts come in handy.

The power of stacked line charts

Stacked line charts are basically a bunch of line charts that we stack. Why is that useful? Well, take a look:

Stacked line chart

A stacked line chart - A better option

The stacked line charts allows us to easily identify and compare the trends and patterns in our data. Using this stack is fairly easy. We just have to keep in mind that the units of measure or the scale is different in each one of the line charts. But that should be obvious.

Your analysis

Generating these stacked line charts is really easy with personal analytics tools like Cognos Insight. Spreadsheets typically required us to generate various different charts and to align them manually.

If you haven’t use them before, get started today! Stacked line charts are very powerful, yet easy to use.

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  • Tsahi Levent-Levi

    I think that the example shows that you also don’t need to overdo it.
    I’d do something different in your example:
    * Place a line chart of both Revenue and Overhead
    * Have it stacked with the next line char that shows the Margin %

    Another option would be to place it all in a single line chart, but use anoher Y axis on the righthand side of the chart for the Margin %.
    In such a case, I’d use bar for the Revenue and Overhead values.
    This can show better the trending you are looking for and if/how they affect each other.

  • cpapenfuss

    Hi – Thanks for your input. I agree – in this case you could easily use a dual axis chart. However, as I pointed out those type of charts are often confusing for people.

    Please also keep in mind that the example above is very simplistic. Think about the case of wanting to compare revenue, margin %, headcount, profit, overhead, etc.. dual axis charts easily become cluttered or won’t work at all.