Big data analytics give businesses the opportunity to get ahead of the game by thinking and acting dynamically. However, there’s a widely held misconception among small business owners that big data is only suitable for large organizations. The truth is, many small companies already generate enough data to gain actionable insights from in the course of their normal activities.
With proper education about data science and the right modern analytics tools, small business owners can unlock the secrets held in big data — and that’s without needing to recruit costly data specialists during the current talent shortage in data analysis. In this article, we examine what data science is, look at how big data is changing business, and consider the four major benefits such analytics can deliver to your company.
Data science in business helps resolve business challenges by scrutinizing data based on numbers, statistics and facts. It uses scientific methods, algorithms, processes and systems to extract knowledge from data that companies can then base strategic decisions on.
You can use analytic tools to create predictive models that simulate a variety of possible outcomes for different situations. For example, if you identify five potential ways you might want to grow your business, data science can predict the way that is most likely to work and presents the lowest level of risk.
A key part of taking advantage of data science is tracking key performance indicators (KPIs) and other metrics. The collected data allows businesses to make decisions based on recurring trends.
Data science can have a significant impact on business areas like market research and process automation. Check some of the valuable use cases below.
Your strategic business moves should be backed by proper reasoning and motivation. But if you want to seize opportunities, you can’t afford to wait months for regular business evaluations. Data science gives business owners a way to make decisions much faster while also mitigating against risk.
Even if your company is too small to create a relevant data set for a particular situation, you can use freely available databases, including those from government institutions and industry associations, to collect applicable data. By gathering and analyzing relevant internal and external information, you can make informed business plans.
Most data tools allow you to create custom reports based on your objective. For example, you can collect data on employee productivity and generate reports on efficiency. You can then use the insights from those reports to set employee performance goals. Some tools to measure employee performance even have data analytics features built in.
Most companies regularly waste employee time on repetitive tasks and can benefit from simplification through automation. Project managers and data scientists, working in partnership with team members, should identify workflow automation opportunities — tasks that could be performed satisfactorily by machines instead of humans.
Data-driven automation has multiple uses, from document tracking to decision-making. For example, AI-powered digital assistants can summarize, sort, classify and retrieve documents and conversations, saving staffers time. Other deep-learning algorithms can be trained to match the skills of human workers. For instance, as you can read in our review of Salesforce Service Cloud, call center platforms can now scan phone, email and social media conversations to handle initial inquiries from customers without human intervention.
Big data and market research are a match made in statistical heaven. By using data science to analyze your market sector, you can uncover patterns among clients, identify consumer preferences, determine the best advertising methods and even project ROI for each marketing channel you use.
Mass-market products are becoming less viable as consumers demand greater product customization and personalization. The only reasonable way to know what people want is by analyzing relevant data. There are free tools like Google Analytics that offer in-depth insights into your customers and allow you to create customer profiles. By looking carefully at the data, you can identify new niches to target. [Check out our small business guide to using Google Analytics.]
Before big data, businesses relied on focus groups and surveys to guide advertising campaigns. Unfortunately, these initiatives often generated biased insights because they only included a few participants. Now, though, with data science and analytics tools, every commercial, online ad or social media post can be tested for relevance with thousands of users. For instance, data gleaned from A/B testing can give businesses hard proof of which advertising campaigns are likely to generate the most engagement.
The same logic that goes into finding your ideal client applies to hiring excellent staff. Much like you need to understand your target customer’s motivations, you need to understand what motivates and engages your ideal worker. Then, you can train machine-learning algorithms to identify what makes people successful in similar positions. Once you know more clearly what you’re looking for and why, the real recruitment work begins — but that’s not where the use of data science ends.
For example, you can use automation tools — built based on the information you collected about your ideal employee and desired traits — to sort through resumes and automatically filter out applicants who don’t match what you’re looking for. Once you’ve identified your top candidates, modern data-collection tools can pull information from each applicant’s public profiles so you can evaluate their fitness beyond what they’ve submitted in their application.
Data analysis can drive business growth and revenue in several ways. Here are the main benefits.
Harnessing big data shouldn’t be reserved for the C-suite or data analysts. Data science helps all employees, regardless of seniority, to improve their analytical abilities and make better decisions. When there is hard data to rely on, employees will feel more confident making decisions relevant to their work without wasting time taking every issue up the chain of command.
Data science lets companies uncover emerging industry trends, sometimes before competitors see them. These unique insights allow you to establish and develop an advantage in the marketplace. For example, if you can identify which products consumers want and which products aren’t selling based on the data you’ve collected, you can invest more in the items likely to sell faster and in greater numbers.
HR teams can use data science to improve their chances of selecting the right candidates for available jobs. This means less time and fewer resources are wasted in finding the best people for open roles. Data science tools can provide comprehensive candidate profiles that make it easier to identify the right person for the job.
Data science allows you to model the effects of different decisions before you carry them out. It’s a way to experiment and conduct trial-and-error tests with minimal risk. Based on the predicted outcomes, leaders can rest assured that the path they’ve chosen is the best one for the business.
Data has become a currency, a way of doing business, and the foundation for sound decision-making. Yet data by itself is just a set of numbers. To make data speak its truth, you need to apply it. Embracing big data and taking advantage of data science requires not only collecting information, but also analyzing and using it to optimize your business.