The best ideas came after analyzing the data carefully and also when you can answer your key questions that are arising in your company. Whether you run a small business or part of a huge company, data is the heart of your organization. Companies rely on data to make important decisions and expect a better financial performance in return. So when they implement better tools and know how to organize their data correctly they get Competitive Advantage.
Data-Driven Decision Making is basically an approach for companies to make valuable decisions for the growth of their company to survive in the present era. The question arises, in what form a data can be analyzed? Data can be quantitative or qualitative where quantitative data is in form of numbers on the other hand qualitative data cannot be measured but both are very important for the growth of your company and also help to make smart business decisions. That is why companies are nowadays opting for data-driven decision making since it is the best way of working to gain a competitive advantage.
In the past data collection was considered to be the most hectic work for the employees but now with the help of different sources in the company, we can access data easily. As a result, good data-driven decisions are also making help in data quality improvement. So it means, while collecting data you are improving your data as well. So how does it work?
The first step is to plan what you are thinking and what you want. A better way is to make a sketch of your steps for taking decisions.
First of all, you need to identify your goals. Why you need data? And what type of data you need? This will help you to gather relevant data.
Collect the relevant data
After Defining your objective you need data but relevant data. Start gathering data by observing, interviewing and with the help of your IT department
Analyze the data
Now identify the key players. They will usually the department heads. Now you need experts that will thoroughly analyze your data. The more complex the data, the more skilled person you will need.
- Take an action.
Now it’s time to turning insights into actions. Make evidence based decisions and happily watch your company growing
E-commerce sites are also using their valuable data to drive profits and increase their sales’ volumes. Have you ever noticed that you get recommendations and receive regular emails about their latest updates on their sites and also about the things you were interested in shopping when you last visited their site? This is called a data-driven purchase strategy, the product you search the most and also whatever you have in your wish list shows in the recommendation so that you could grab them easily. Likewise, when you visit a restaurant and before leaving the place they provide you a card to fill in which they ask you for the recommendation and also about their service quality. After collecting the data they try to improve their quality of the service to boost their sales. They use data-driven decision-making strategy for the betterment of their business. They actually keep the record of their customers by which they get suggestions for improvement. Lastly, Google is the multinational tech giant that uses data-driven decision making as well, it gives us a good example of excellent use of this strategy. They collect data to answer their own raised question for upgrading their services. They started with the aim for better user experience.
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Source: Smart Data Collective
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Original article: How Data-Driven Decision Making Is Giving Companies Competitive Advantage.