Throughout my 20+ years in business consulting I’ve often been asked what my favorite go-to chart is for effective presentations to executives. 

Coming up with a favorite is difficult because I typically have a stable of 5-6 go-to’s that do the best job in getting executives to understand current-state issues and buy into proposed resolutions.  It’s a little like asking me which of my pet dogs is my favorite. 

Pressed for my favorite of all, though, I’ll have to go with the Waterfall chart.

Waterfall charts (also known as Cascade or Bridge charts), do a fantastic job in telling the story of change.  I can show how an initial value is affected by a series of intermediate positive or negative values that “flow” into a final value, with each step represented by a different color or pattern.  An example is presenting how major changes contribute to a total value (Figure 1).

Waterfall charts are also great at showing data over time.  For example, a company may use a waterfall chart to show how its revenue has changed from one year to the next, with each step in the chart representing a different quarter.  They are great for easily identifying trends and patterns in the data, and can also help to identify areas where the company may need to focus its efforts in order to improve performance (Figure 2).

Why are Waterfall charts my favorite and most often used?  Because of their simplicity and completeness in painting a picture in the minds of the executives. 

In one slide, I can provide a succinct and powerful visual of many-to-whole relationships.  And individual problem pieces (with the help of a different color) stand out like a visual sore thumb in a Waterfall chart (Figure 3).

Best Practices

When creating a waterfall chart, it’s important to choose the right colors and patterns to represent the different steps in the process. For example, positive values might be represented in green, negative values represented in red.  You want the story you are telling to pop — if an executive sees a negative red bar, it provides instant recognition and understanding.

Also important – be sure to keep the data components on the slide to a minimum (approximately 8 or fewer).  Too many and the slide looks more like a bar chart and dilutes the real story you are trying to tell.

Tools

For basic Waterfall chart development, Microsoft Excel has Waterfall charts built into its Chart function.  Microsoft Power BI has slightly more advanced Waterfall capabilities. 

You can build Waterfall charts in Tableau but they can be a little clunky through exploiting Gantt bars and calculated fields for calculations.  

I’ve used a product called Think-Cell as a plug-in for Excel and PowerPoint; it is powerful and easy for embedding build-up or build-down Waterfall charts, among other nice features (www.think-cell.com).   

My personal favorite (which I used almost daily in a strategy development role for a medical products company) is Mekko Graphics.  While somewhat pricey at $399 per year, the Mekko graphics software has the best Waterfall chart functionality I’ve seen and has a ton of other chart capabilities (www.mekkographics.com).

So there you have it: my favorite and most often used chart for effective presentations to executives, the Waterfall chart. And please don’t ask me which of my pet dogs is my favorite.