Data is the most valuable tool a business has.
With the right analytics, you can learn about your customers, and what they need from your company, or make investments in products that are more likely to pay off.
Data-driven decision making is all about making choices for the future of your company, based on the evidence you’ve gathered from various environments.
The good news for today’s companies is that there’s more data to guide you than ever.
Experts agree that we create about 2.5 quintillion bytes of data each day. That’s a lot of guidance for your business to tap into if you know how to use it.
Here’s how data-driven decision making could transform your company’s growth.
Data Paints a Clear Picture of Your Situation
Data is the best way to get a clear idea of where you stand as a business.
With access to the right data stream and some analytics tools, you can answer various crucial questions about your company, from “what is our top-selling product”, to “when is our busiest month?”
To discover the power of data for yourself, all you need is a goal and the right tools.
For instance, if you want to know whether you should continue investing in social media marketing, you will gather your social media conversion data.
This would show you how much you’re making on your social ads compared to how much you spend.
By painting a clear picture of what’s happened in your past and what’s currently happening in the present for your company, you make sure that everyone in your team has a clear picture of where you stand.
Data Helps You Predict the Future
The data you collect tells your data scientists and technology teams what’s working (or not working) for your company right now.
That’s a great way to ensure that you’re not wasting time and money on strategies that aren’t helping your business.
However, by looking at historical data and trends that build over time, it’s also possible for professionals to accurately predict the future for your company too.
For instance, you can use your historical data on peak demand times to figure out when you’re most likely to see a surge in new business each year.
This means that you can ensure you have enough staff on hand to manage when purchasing volume rises.
By showing you the details of what’s worked for your business before and what hasn’t, data can help you to make better decisions about your future, and even prevent issues from happening again.
Data Can Prevent Disaster
For a long time, many business leaders made decisions based on their gut instinct or intuition and simply responded to the results as they happened.
While this worked fine for some lucky companies, it also meant that many organizations crumbled when unexpected issues occurred.
Adopting a data-driven approach to decision making can help you to avoid issues that might destroy your company.
It’s even possible to use real-time analytics to stop issues in your business from growing too large.
For instance, many modern companies use consistent monitoring and analytics tools to ensure that their systems or technology is running smoothly.
An analytics service will automatically inform an IT team if there’s an issue with something like a supply chain delay or a telecommunications outage so that the problem can be fixed as quickly as possible.
Data Improves Transparency and Accountability
One of the biggest benefits of data-driven decision making is that it helps to make your business more transparent and accountable.
In an environment where every organization is under increasing pressure to follow new guidelines and regulations, no one can afford to underestimate this benefit.
When you have a strong data-driven strategy, you can show authorities and officials the reasons behind all of the decisions you make, and back up your approach.
You’ll also have systems in place that prove you’ve been compliant with any industry guidelines that may have been relevant when you began to grow your business.
Even in times when you decide to merge your company with another or seek investment from third parties, a data-driven strategy is a great idea.
It proves you’re on the path and shows potential partners that you’re trustworthy and accountable.
Data Creates Optimized Companies
Data-driven decision making enables you to constantly optimize and improve your business, one bit at a time.
Proper resource management is crucial for businesses to ensure they’re not wasting time and money.
With data, you can make smarter equipment and scheduling decisions based on how your employees are using your resources.
When you know exactly how your assets are used, and where they deliver the most benefit, it’s much easier to leverage each investment properly, and get the most value back from it.
For instance, gathering data about your audience and team will show you whether you can realistically afford to compete in a new marketplace, or if your employees are too stretched already.
Don’t Underestimate Data
Data is the key to better decision making in any business. It improves your chances of success and reduces your risk levels significantly.
So, why rely entirely on intuition and gut instinct, when you can use facts to push your business to new heights?
With so much information available today, companies have no excuse for not making data-based decisions about their growth.