Data-driven decision making has quickly become a topic of great importance to business owners and decision makers across all industries. With data being found in everything from Google AdWords and Analytics, reports from your different departments or numerous Excel sheets with thousands of data point, it has become more and more apparent that this information needs to be distilled into understandable information that can be accessed quickly.
This is made possible with the implementation of Master Data Management Systems (MDM). MDM’s define and manage your critical data in a way that enables your organization to make decisions based on the most recent and complete data. It provides companies with a single point of reference by integrating all their data into one central system.
Data for businesses grow
Problems that may be facing many corporations is that data is fractured across the organisation in various formats and structures. Because of different roles you have limited data available to your specific function within the company. You will very rarely have one role or person in a company that has knowledge of all the data flowing through a company and what the data can show them. More often than not, you will have several people looking at multiple data sources to specifically solve a problem in their department – as opposed to the issues the company is facing as a whole. This also leads to an inability to see and analyse live data. Data is not being used to help businesses grow.
Let’s take conversion rates as an example. Your marketing department will be monitoring Google analytics and looking at your conversion rates. One product seems to be performing well with a high conversion rate and a number of units sold. However, without the finance department involved, the marketing department is not able to extrapolate whether the product is bringing in a profit. Are the high sales rates due to a low-cost product, or is it performing better than expected? Conversion rates are affected by more than just price. You also need to take into consideration the success of marketing campaigns, the popularity of your product, who your audience is, etc… Would you make the same decisions about the product if you had access to all this information? On how all these different components are affecting your sales?
Whatever data is being analysed, is subject to interpretation by the person or department doing the analysing. There is no one “story” that can be whole truth and nothing but the truth. As a business, you want to find out whether a certain product has been profitable to you over an extended (or specific) period of time. With no quick way to analyse the data (up until now), you’ll have spent hours dedicated to analysing reports, spreadsheets, facts and figures. All to be able to make the right decision at the right time.
Benefits of data-driven decision making
Business intelligence and amalgamating your data into a central repository has several benefits:
- All your data gathered and stored into one central place (thus eliminating data being lost or replicated across departments)
- Control over all your data
- Information stored, collected and shared at a frequency that best suits your business and the data being collected (quarterly, monthly, daily, hourly, etc.)
- All of this information can be shown visually by using programmes such as PowerBI, QlikView and Data Studio.
Tell us if this scenario seems familiar. You’re collecting information from 4-6 data sources from different departments. You’ve been manually exporting data into Data Studio or Excel, building pivot tables. You are wading through potentially thousands of data entries to understand how your business is performing. You need to amalgamate information from all your different departments and “translate” them in order to help you make decisions. Senior management meetings where datasets are being discussed turn into discussions on the different interpretations of the data and result in different action points.
Would it impact you and your staff if you were able to gather all this information into one system? What would life look like if you no longer had to create reports manually? Would you benefit from having a system that prepares your data, aggregated the information, clean your data so you had only the most relevant information available?
By having a central repository for your data (such as BigQuery which is great at working with massive amounts of data) and making sure the data “speaks the same language” – you can create predefined queries that will pull your data and easily show you the information by using a business intelligence system (such as PowerBI, QlikView, Data Studio etc.). This is where you get beautiful visuals that help you make important decisions at the right time.
This sort of unifying management system can be very useful to those senior management meetings.
Am I ready for data-driven decision making?
As soon as you want multiple sources of information to talk to each other, data-driven decision making becomes relevant. If you can run your business and make decisions by using Excel or similar spreadsheets then continue. However, if spreadsheets are no longer giving you the information or overview you need to make decisions or causing confusion, – then something needs to change.
Data goes beyond just looking at how your business is performing. It is also a way for you to keep an eye on competitors and using data to decide where you sit in comparison to your competitors. Data-driven decision making goes beyond solving data gathering issues – into using it to grow your business.