Three Things You Must Do to Become a Data-Driven Business
For companies to thrive in today's market, adopting a data-driven approach is non-negotiable. Over the past decade, brands that have digital ingrained in their DNA such as Amazon, Netflix and Uber have changed the playing field, forcing established businesses to become more agile and proactive in order to remain competitive. With large volumes of data created every day, it's no longer enough to leave it sat dormant. Instead, this treasure trove of information needs to be utilised effectively to help drive decisions that bring value to the business.
When harnessed in the right way, data has the power to increase revenue, improve employee productivity, gain a better understanding of customers, develop new products, mitigate risk, and help plan for the future. Ultimately, when coupled with automation and analytics technology, data provides the underpinnings of digital transformation, helping business leaders visualise what is happening within the organisation and helping systems to digitalise manual processes. Some household names such as McDonalds and Coca-Cola are already effectively leveraging the power of data and analytics to make more informed decisions, from using customer behaviours to optimise marketing to interpreting trends and patterns to drive product innovation. Others have either been too slow to adapt or failed to transform resulting in business collapse. This has been highlighted during the pandemic when the combination of financial hardship, lack of digital infrastructure and rigid business strategies caused many small and large organisations to disappear from the market entirely.
A recent study from the Harvard Business Review reveals that while companies have been investing heavily in data, analytics and AI initiatives over the past three years to become more data-driven, there has been a decline in momentum and they are struggling to derive value from their investments. Common challenges include reluctance to change, slow business processes, lack of skills, growing data sets and ever changing customer behaviour. Just 24% of senior executives claim their organisation is data-driven. Here are three ways to overcome these barriers.
1. Improving data and systems
The right data can drive digital transformation projects by unlocking insights that deliver immediate value to the business – even if a company is at the start of their digital journey. From enabling the digital strategy to aligning and integrating systems, data informs each phase of the process increasing overall agility and responsiveness.
However, it's important to note that there is a crucial interdependence between systems and data which means that if an organisation adopts technology without cleansing its data first, it will have essentially just accelerated the processing of inaccurate information. This could do more harm than good. Before using technology to interrogate data it is critical that all information is timely, accurate and complete. Poor systems and processes over time result in data that is simply not useable in its current form to elicit any meaningful outcomes on which to base digital transformation strategies. If the issues that resulted in that poor data are not identified and corrected, solid foundations will be weakened by subsequent poor data, resulting is less meaningful digital outcomes. This translates to either more time spent fixing issues later down the line or it could stunt the decision-making process leaving the business open to unnecessary risk.
2. Driving culture change
There needs to be a synergy between technology and people. Technology is advancing at such a rapid rate that it's creating a skills gap – either technology needs to slow down which is highly unlikely, or organisations need to catch up. Adopting digital tools is just the first step in the digital transformation journey. To leverage data effectively and ensure the insights it delivers are proving valuable to the business, there needs to be a cultural transformation where all employees are embracing the change. Focusing on quick wins that showcase the advantages of new technology is a good place to start, paired with training to make sure everyone is well-equipped to use the tools required. Digital transformation advocates can also be appointed to monitor the transition, overseeing its integration across each department.
3. The right tools for the job
Without a solution in place, data can become extremely difficult to manage and control as it grows in quantity, meaning an organisation is not able to access valuable insights that could help make better and more informed decisions. Whether that is to tap into market trends, respond to unpredictable events such as the financial crash or the pandemic, or to stay relevant amongst more digitally enabled competitors. Adopting best-in-class business intelligence software and analytics tools can help organisations make more data-driven decisions. They have the power to collate, manage, and organise data, pulling information into charts and visuals, making it possible for ordinary business users to join the dots between different systems and uncover patterns of behaviours. These tools can also track KPIs, schedule automated reporting, forecast predictions and much more, offering enormous value to an organisation and enabling business leaders to make decisions up to five times faster.
It's clear that the creation of data isn't slowing down anytime soon. It's imperative that businesses start adapting their strategies and implementing initiatives to leverage their data effectively in order to make better informed decisions. This will not only help them remain competitive by ensuring revenue opportunities aren't missed but it will also help them be prepared for any unexpected scenarios they might face in the future.