»Data is the new oil.«, said mathematician Clive Humby. You have probably heard about this quote before, but did you know it is also relevant for your company?
Every company no matter how big or small generates and collects data. Some departments like accounting generate more, others less. There is digital data like bank transactions and there is analog data such as handwritten forms. But how can data help your business to grow?
1. Decision making
Most decision-making is still based on gut feeling. Sometimes your »gut« can help you a lot, however, it has one big drawback, it is subjective. On the other hand, pure data doesn’t have this problem, but you need skills to transform it into actual information. The future of decision-making is based on objective data and controlled by your feelings, not the other way around.
2. Performance understanding
All companies have ups and downs, some of them, like seasonality, are straightforward, others seem pretty random. With historical data, you can discover new, previously hidden patterns which will increase performance understanding. Furthermore, you can also predict it and shift resources accordingly. There is always some randomness but most of the patterns can be found and leveraged using data analysis.
3. Problem solving
Problems are a part of every working process. You can tackle them in two ways, with a temporary or permanent solution. Temporary solutions are fast and easy, but they usually don’t eliminate the root cause and the problem may repeat. To find the permanent fix, you need to dig deeper. Data can help you understand the sequence of events that lead to the problem and find the permanent solution. It takes more time, but the problem will be gone for good.
4. Process optimization
The business process is a series of steps to achieve a concrete goal. Usually, they are repeating, therefore their optimization can have a great impact on your resources. You can’t optimize processes without analyzing them and you can’t analyze them without data. Using data analysis, you can find out what works best and make optimizations.
5. Customers understanding
Customers are the most important asset your company has and they should be treated accordingly. You should understand your customer’s needs as deeply as possible and there is no better way than using data. With data analysis, you can gain insight into why customers chose you and leverage the new knowledge to strengthen the relationships even further. Collecting data is important, but it is even more important that they are informed of what and why you collect. If you are doing everything right, your customers can become your true brand ambassadors.
“We are surrounded by data, but starved for insights.”
Jay Baer, marketing and customer experience expert
Collecting data is important, however pure data is not useful on its own. It must be turned into information using data analysis. The more data you have the more information you can extract.
Large amounts of data are already forcing companies to change their way of thinking. It is time to take action and boost your business by transforming into a data-driven organization.
