Times were much simpler just a few short years ago, at least for the majority of us in the business world. It seems that gone are the days of running business purely on instinct and experience. Thanks to the tech-boom we have ushered in an era of perfectly manicured campaigns, spreadsheets, and painstaking calculations of ROI. The principle of collecting data to make informed decisions is nothing new, however, it has been recently propelled into the mainstream and become an absolute necessity to remain relevant. The process of data collection isn’t expressively romantic, however the outcome and the power it gives you makes up for its lack of seduction.
Previously, making data-informed decisions was an afterthought to determine if we’ve hit or missed the mark – usually visited monthly, quarterly, and yearly. The technology wasn’t advanced enough to get a clear picture of what was happening on a micro level. Thanks be to the technology Gods, we now have access to tools that will give us real-time insight on the health of our business allowing us to make micro-decisions on the fly to garner the best possible outcome.
According to a recent study by IBM, they found that 90% of the worlds data has been created in the last 2 years. I don’t know about you, but that makes me feel data-deficient. That statistic alone makes me want to be on the right side of history when it comes to analyzing, quantifying and understanding data to drive business growth.
WHAT DOES DATA-DRIVEN MEAN
For anyone that took statistics in college, this concept should be familiar to you. Being data-driven is the process of gathering information, understanding the numbers, looking for patterns, then synthesizing that information in order to enact some form of action that will yield a predictable outcome. The insights gathered should drive the real-time decision making processes on a daily level.
WHY IS IT IMPORTANT
Simply, it’s the difference between feast or famine, bankruptcy or IPO, explosive growth or crushing recession. It’s the catalyst that closes the gap between ideas and results.
According to An Economist Intelligence Unit Survey of 530 senior executives surveyed, over 43% of respondents say that data is “extremely important” to strategic decision-making. Furthermore, 40% say data are extremely important to marketing and communications, as well as finance and accounting.
Understanding the ‘why’ in business (why are we successful/failing) can create an environment of discernment and growth by fostering a clear and concise roadmap. Using statistics and data to determine our trajectory on a day-to-day basis is key to streamlining processes, becoming more efficient and making more informed decisions to carve out a stronger competitive advantage, therefore yielding a higher ROI.
HOW THE NUMBERS WORK
o Help you to understand your market position
Knowing is half the battle, right? “Running the numbers” often can help you to determine what’s working and what isn’t. The faster you can make a course-changing decision, the faster you can mitigate damage, and higher the chance of recovery. Additionally, with a few core pieces of information on your competition, you can evaluate how you stack up (trust me, they are doing it to you).
o Set clear and attainable goals
Using data can help you plan and position your human capital, financial resources, and execute well thought out action plans. Knowing what it takes to get where you want to go.
o Analyze, Adjust, Achieve
Using data and analytics at the core of your operations can offer immediate problem solving results and provide valuable insight to anticipate future obstacles and opportunities.
THE POWER IS IN THE NUMBERS- USING NUMBERS TO FORCAST
I love the proverb: “that which gets measured, get’s managed.”
Measuring data is far more than dredging over 1’s and 0’s and manipulating spreadsheets to the point of insanity. It’s far more personal, it’s about understanding your customers on a very fundamental, and intimate level therefore being able to predict and control behavior. Everyday examples include: your FICO score, what posts you see on Facebook, and even the last presidential election (known as “the election of data” – read about it HERE).
With great responsibility comes great power. It’s important to be wary of “cherry-picking” the act of sampling the data to reflect your intended outcome- only paying attention to the data sets that support your argument and leaving out the information that doesn’t. We must honor the data and make unbiased (more importantly, unemotional) decisions based on what it’s actually telling us, not what we want it to say.
Understanding these numbers yields two benefits, the first being, you immediately have a competitive advantage over yourself (the “uninformed” you) and secondly, you can begin to utilize these analytics to swing the market in your favor. Being able to understand and answer WHY, HOW, and WHEN your customer will buy will embolden you to be able to give them exactly what they need before they even realize they need it.
Chant it with me now - Metrics! Metrics! Metrics!
HOW TO BECOME A DATA DRIVEN COMPANY
The commitment to become data-driven must be embedded in your company DNA. Emblazed in your core values. Decreed from the top down. Making the culture shift to implement analytics company wide takes hard work and isn’t an easy transition for those resistant to change. The road to data fluency may be long and winding, however, making the strategic decision to be data-informed will empower you to make calculated decisions faster, more accurately, efficiently, and confidently.
Now begins the fun part of being romanticized by your data. Once implemented you will live and die by your data. Here are a few recommended resources by trusted colleagues and myself to get you started:
Google analytics – Website analytics
Alexa.com – Website Analytics
QuickBooks - Accounting
Ziprecruiter - HR & Hiring
Hootsuite – Social media management
Serpstat - Keyword research, content ideation, and competitor research
Getapp.com – 5,000+ apps to help grow your business using data
TOP DATA PODCASTS
IBM Big Data & Analytics Hub
Measured Direction Podcast
TOP DATA BOOKS
Everydata: The Misinformation Hidden in the Little Data You Consume Every Day – John H. Johnson
Big Data: A Revolution That Will Transform How We Live, Work and Think - Viktor Mayer-Schonberger & Kenneth Cukier
Social Media Analytics: Effective tools for Building, Interpreting, and Using Metrics – Marshall Sponder
Vegas Young Professionals is an organization committed to supporting those in our community willing to take risks and pioneer innovation. We are a group of like-minded individuals with the dream to do more. I’m happy to share any insight and encouragement with you or if you have any questions on how to get started or want to share your success story, email me at Marketing@VegasYP.com.