Companies that are insights-driven are 2.8 times more likely to report double-digit growth yearly in comparison to brands not leveraging data. Utilising data to upscale your business and make better decisions is a tricky thing to undertake as most businesses think as if they do not have enough data to use or look to data as a reporting tool.
The idea is to use the collected data to make key business decisions whether they are related to marketing, ad spend, new products, service updates, etc. or transforming your business completely.
So, let’s discuss how you can use data to achieve business objectives and the reasons why you need to make your company a data-driven entity:
The importance of data
Data serves as a collection of customer reviews, ratings, meetings transcripts, user behavior, revenue, etc. It allows you to track metrics such as how many customers you acquired in a week/month/year and how well the product performed. If tracked accurately, data can revolutionise the way you conduct business.
According to a strategic advisor, Bernard Marr, data for small companies can be immensely helpful. It can help you make effective changes in your business model, acquire great talent for your team, identify trends, and analyse your competitors.
So, it is important to note that every kind of data is good as long as it is collected and utilised correctly.
Best practices to collect data and its importance
Data collection alone is not useful and it is quite heavy on the pocket of businesses. So, storing data and not utilising it does not make sense. You need to utilise the collected data to foster your organisation. So, you need to spend your resources in areas where you know it will pay off.
Having collected data will give insights into how you can improve the product experience, the performance of your marketing practices, etc.
Here are a few best practices you can incorporate while collecting data:
- Allocate your resources on the data you need and root out the irrelevant information. You must figure out what source of data is reliable and the inaccuracies that tag along in tracking it. Further, you can even use third-party data resources to understand user behavior and industry metrics.
- Collecting the data you need becomes essential to the process as we live in a GDPR world. In European countries, it is a new set of guidelines that are deployed to protect users’ privacy rights. So, users only give the data they choose and organisations can only collect the data they require. Thus, comply with the GDPR guidelines in mind while collecting user data.
Having a common goal with a data team
Most organisations think of data professionals just as a source of reports where senior managers go when they want to learn about a marketing campaign performed, customer satisfaction improved, etc.
But a data-driven strategy to work, you need to have a team that not only gives you reports but is involved as an integral part of a strategy that will get you to set the right goals and help you achieve them.
They can help track the performance of a strategy in place with upfront information and having common KPIs can help the company move swiftly towards a common goal.
Readily available results
The questions about the effects of data-backed decisions often linger in the minds of executives as benefits of data-driven strategy can take some time to reflect in the results and observe major organisational transformation changes. But various organisation functions readily showcase the effects of a data-driven strategy, such as:
- Human resources: Data showcases the gaps that your organisations need to fill. Tracing those gaps and identifying the expertise of professionals who can help you bridge this gap can be immensely helpful in acquiring the right talent. For instance, Applicants Tracking Software is used widely by recruiters to make the resume screening process more efficient.
- Customers: Based on surveys, user data, reviews, etc., companies can make more informed decisions related to customers. This data will help you avoid mistakes so you can retain customers and acquire new customers. Further, it will help you serve your existing customers better.
- Decision making: You can track KPIs to understand the problems you are facing and bolster the status quo practices. Having dashboards tracking the KPIs will help you stay on top of the inaccuracies your company is facing and set the course straight right. Basically, it streamlines your key business decisions based on factual information
- Time efficiency: Having a data-driven approach can help in developing a predetermined plan and manage time to start a new project. It will help in targeting sectors that need your utmost attention and avoid wasting time on pointers that do not require immediate attention.
Objectives and key results
OKRs equip companies with data. It helps you set the objectives and provide the results of those goals with concrete information. This data from OKRs can help executives identify gaps in the operational efficiency and streamline the process.
With having goals set in front of each employee of the organisation, it creates an environment that keeps the interests of your employees and the companies aligned.