In recent years, data has emerged as one of the most valuable substances in the world. It’s more important than oil, gold, or anything else you can think of. The reason for this is that data helps us to make crucial decisions. It determines where our businesses should grow, which services customers need, and more. According to IDC, the global revenues for big data hit around £113 billion in 2017, which is a massive increase of 12.4% on the previous year.
The question is, what’s the role of data in decision making, and why is it so important to gather this information today?
The Role of Data in Decision Making
Data-driven decision making has become a crucial pillar in enabling both digital transformation and industrial growth. With an organised data strategy, you can find out everything from which tools your employees are using, and what they need to be more productive, to how you can improve customer satisfaction.
By next year (2020), studies suggest that we’ll be creating 1.7 megabytes of new data every second. That’s a lot of information to tap into for any growing company. Fortunately, software and tools are now available for companies that want to make the most of these large quantities of information. Whether you’re looking at market composition, financial potential, or something else entirely, data has the power to transform your decision making.
Here are some of the ways that businesses are investing in data-driven decision making today.
The Role of Data in Decision Making for Sales & Marketing
The role of data in decision making changes depending on your goals. For instance, industry-specific information allows organisations to discover crucial sales information and insights into customer preference, promotion success, and purchasing habits. Looking at these trends can lead to the creation of patterns that improve and support profits. Accessing information about buying habits also permits companies to decide what the right step is when it comes to retaining crucial clients.
You could look at the data gathered from your VoIP technology about the conversations you’re having with customers and find out which conversations are most likely to lead to up-sales or cross sales. Alternatively, you can use your CRM data to find out which kind of customer is most drawn to your products.
By monitoring the trends that determine your customer preferences, you can not only deliver better sales experience to your audience but enhanced marketing too. Data analytics software can identify the promotional campaigns with the best ROI using previous information as a guideline. This means you can quickly determine how to prioritize your campaigns, tailor promotions, and maximise engagements.
The Role of Data in Decision Making for Executives
Data-driven decision making isn’t just valuable for sales and marketing teams. It can also be a valuable solution for your executive groups too. Data analytics ensures that executives can make stronger decisions based on statistical facts, rather than just having to guess at their company’s future. For instance, a security company may use the data they collect to determine that having IoT systems in place to highlight when a system is failing is more effective than using manual checks.
Data analytics will allow for extensive reports to be created the highlight the measurable benefits of using these new IoT strategies, which can then be presented to executives and stakeholders. Ultimately, the role of data in decision making ensures that a manager can find the most effective strategies based on real numbers and experiences.
With the rise of predictive analytics, it will also be possible to make predictions using historical data and current trends. This way, executives can get ahead of the competition and avoid errors before they ever happen.
The Role of Data in Decision Making for Inventory and Finance
Using data analytics to identify potential issues in the business and unlock new opportunities could mean that your company can improve its inventory management too. For instance, if you can track your business essentials, you can determine when you’ll need to order new resources.
In the same vein, data analytics also provides an up-to-date view of your financial situation. Managers can view things like business ledgers, profit and loss, and balance sheet features to access greater business intelligence. Many analytics tools will even give you the option to drill down into the details of individual transactions to review the best opportunities and cost concerns. The more information you have about how you’re spending your money, the better. It ensures that you can make sure you’re getting the most out of your budget.