By the Numbers: Are You Making Smart, Data-driven Business Decisions?

Business.com / Business Intelligence / Last Modified: February 22, 2017

Data has the answers to all your business questions. Smart decisions just depend on how well you can interpret that data. Tips ahead!

The dataverse is growing every minute.

We live in a new reality, where every piece of data from the number of steps we take to your child's favorite color is online.

The Internet of Things is here, and it's all around us.

Smart businesses use data before they open their doors or launch new products. More than dry facts and figures, your data contains the information you need to answer every significant business question that may arise.

Related Article: Big Data is Redefining the Supply Chain: Putting Business Intelligence to Work

It's easy to become overwhelmed with the sheer volume of information available. Most businesses, though, are more concerned with customer demographics and purchase patterns, and rightly so. Too much data is just that, too much data. You can be successful by focusing on what's important. The bits and bytes that help you get to know your customer can help you figure out what their problems are and how to fix them.

Some businesses are resistant to change and still mired in methods that worked in the past, plagued by out-dated systems and time-consuming processes. By getting everyone on board with new attitudes and processes, you can streamline and modernize your operations. In the process, you'll develop better, more informed customer service, marketing, and even web or store layout. To make smart, data-driven decisions, you'll need to overcome the objections and know how to use the data you collect.

If It Ain't Broke, Don't Fix It

Change can be scary. Maybe your management team is stuck in its ways, still trying to rock it old school using techniques they learned in business school 30 years ago. They might even fear that the staff isn't competent to adapt to new processes. So you stick to what used to work and watch your business slowly decline.

There's no easy answer, but it's time to update. Adopt a CRM and train your staff to use it. Once you integrate your email service, calendars, and other process systems, and automate repetitive daily tasks, you may ease the workload of your key personnel...leaving them more time for the important business of innovating.

Using Data to Inspire Buy-In

While you may understand the facts and figures, your department heads or board of directors may simply be nodding along (or nodding off) when you present them with columns of figures. One way to get their attention is to convert your data to colorful charts and graphics with an excel dashboard they can use to keep up with the day-to-day. Data can help you spot trends, identify processes that aren't working, and define your strengths, weaknesses, and budget issues if you and your business stakeholders understand it.

Cooking the Books

Data can be easily manipulated to prove a point. By picking and choosing your data, you may come to a faulty conclusion, and make bad management decisions as a result. Let the data speak for itself, and don't look for connections that aren't there.

When interpreted without bias, data can help you overcome your preconceived ideas, those outdated standards you've grown accustomed to. If you don't trust your own interpretation of the data, bring in outside help.

Welcome Employee Ideas

Brainstorming with employees can have surprising benefits, and not every business encourages employees to speak out. Inviting them into the process boosts their sense of value. It's good for morale and employees who feel valued are more loyal.

Ask employees to participate by discussing data issues and trends. It may be enlightening to learn how customers and front-line employees interact. Simply by asking, you can pick up comments and insight to put your data in context. For example, if people are returning a certain dish in a restaurant, the problem may be that the dish is bad, but it also might be a heavy-handed inclusion of a strong flavor, like garlic or ginger, or that it's being served at the wrong temperature. Context can help you pinpoint the real problem...and get a fried ice cream dish on the table faster.

Related Article: How Business Intelligence Software Will Improve Your Business

7 Ways to Put Your Data to Use:

We've talked about collecting and understanding your data, now let's discuss what you can do with it. Even the most basic spreadsheet should have information you can use to improve the customer experience or work environment, to make a forward-thinking budget plan, or to find ways to improve or make sensible cuts.

1. Create a more personal experience – whether retail or service, online or down the street, data gives you the information you need to create a more intimate experience for the customer. Most customers are willing to spend more when businesses provide better service.

2. Offer new products and services - build on your best-sellers by innovating new related products based on customer feedback.

3. Target marketing - segment your data to make lists of specific customers. Instead of wasting your time sending and straining the patience of 35-year old nurses by sending them offers for products designed to appeal to grandparents, send them offers they'll love, like a sale on comfy shoes or an app that identifies insect bites (it's probably a thing).

4. Improve productivity – adjust your schedules so you're prepared for the most busy times, stocked with your most popular products, and always prepared to deliver stellar service to your customers.

5. Beef up your blog – the most-shared content online is long and full of information. White papers, reports, and surveys are great traffic and link generators.

6. Update your business – use customer feedback to change, whether that means updating a tired waiting room, redesigning your systems, or providing faster service.

7. Thank, congratulate, or recognize – offer special perks on special dates. Birthdays, the anniversary of when you started doing business, the birth of a new baby, or the start of a new job. If your customer is celebrating, send them a little something to show you care.

8. Rethink your budget – find areas where money is wasted and streamline and plan for the future.

9. Reward your employees – in every business, some employees make quiet waves in the background. Data can help you identify workers pulling more than their own weight so you can reward and encourage them accordingly.

10. Sell the board on new ideas – broaching a new idea in a board meeting can be pretty awkward without hard data to help you sell it. Showing a graphic representation of a predictive trend is a powerful persuasion tool.

Related Article: Emotions vs. Information in Business Decision Making

When you focus your data, make it easy to interpret, and accept input from employees and stakeholders, you're on the road to using your data effectively. What data do you collect, and how do you use it?

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