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Six reasons to harness your data for business success

data
(Image credit: Image Credit: Geralt / Pixabay)

Being driven by instinct can be important when making business decisions, but for a reasoned approach, data must be involved. Being information-driven provides a wide range of benefits to businesses, allowing them to not only be confident in the decisions they make but also in providing quantitative results by which to measure and further improve the wider business strategy. However, an information-driven culture is not established overnight. Businesses need to plan accordingly and leadership buy-in needs to permeate throughout the business for this approach to be successful. 

What does it mean to be information-driven? 

Being information-driven involves processing and analyzing data to determine business strategy, this should underpin the instinctive response, providing a rationale based on logic and fact, rather than opinion. By undertaking this more rigorous approach, organizations can leverage the information collected to provide insights that can inform decisions in the present as well as how they should evolve. 

But, being truly information-driven involves more than looking at the numbers. This is only the first step. The key to implementing an information-driven approach is to analyze the data systematically, thereby omitting the possibility of incorrectly interpreting the data due to inherent bias.

Advances in data search capabilities have made data analytics a reality for businesses of any size and adopting an information-driven approach has become the norm across all industries.

Why be information-driven? 

Information-driven businesses can make more informed decisions, which leads to a domino effect of other, more substantial benefits. The ability to measure progress and adapt to changing business needs as depicted through data promotes greater business agility. It makes organizations more efficient in recognizing market trends and faster at responding to opportunities or threats than competitors. 

1. More confident decision-making

An information-driven approach enables an organization to be subjective. By putting data at the heart of every decision you make, you can face each challenge head-on knowing that you have a greater chance of success than if you were to use your intuition alone. For example, Starbucks uses data from a location analytics company to understand which locations are better suited for their target market. This way, Starbucks can be more confident that an investment will result in success before making it.

In addition, data will provide you with quantifiable insights into the impact of each decision so that you can optimize your strategy accordingly. Benchmarking in this way will support any business in maximizing its potential while mitigating uncertainty for business leaders and managers.

2. Spotting opportunities

Data has always been a requirement of the market research process but having an information-driven strategy enhances this capability significantly. It allows businesses to identify emerging threats or opportunities in the market quicker than competitors. It informs the ability to adapt quickly to changing customer requirements and speed the journey through the sales funnel for prospects. All of which enables companies to be more informed and prepared for the future.

3. Predictive capabilities 

An information-driven approach transforms an organization from reactive to predictive. Rather than waiting for a situation to arise, businesses can use data to accurately forecast the outcomes of a given situation. For example, Blue Apron, a meal-kit organization, analyses customer data to better predict demand for their products to reduce waste. This predictive ability therefore mitigates risk and, in the event of the unpredictable, decreases recovery time. 

4. Agility and scalability

Time and time again, business agility has been linked to superior business performance and according to McKinsey, it is now essential for success. Enterprise agility has proven essential throughout the global pandemic. The ability to adapt to changing demands and requirements using data has allowed businesses to continue operations despite unprecedented disruption.

Being information-driven increases agility by allowing companies to be more flexible when making decisions, determining the next course of action, or assessing operational efficiency. This gives leaders an advantage when changing direction or executing new ideas, which are key when looking to grow a business sustainably and productively. 

5. Efficiency and savings

As previously mentioned, an information-driven strategy allows businesses to benchmark progress against tangible results, holding department heads accountable for driving profitability and economic cost-management throughout the business. By providing management with access to real-time data analytics, they can more easily spot opportunities to cut expenses and maximize resources, saving both time and money in the long run.

6. Augmented employee experience

Clear data can provide clarity to the decision-making process, reducing the probability of tension arising within the team and easing communication. Additionally, being information-driven can provide benefits of a much greater value to your staff, instilling confidence, and motivation. With the right tools in place to support their work, employees can collaborate with their team more efficiently, and provide visibility to tangible results for their work. Consequentially, this can improve job satisfaction and employee engagement, reducing staff turnover and improving loyalty.

Cultivating an information-driven culture  

Although collecting and monitoring data has become commonplace, it’s still unusual for a business to rely on data for critical business decisions. It’s important to recognize that taking your organization to the next level of its data journey does not have to be all or nothing; even selective use of data for decision-making can reap considerable benefits. Once the evidence of success is clear, the concept of being information-driven will gain momentum and the transformation to becoming information-driven accelerates.

Building an information-driven culture in your organization requires a combination of stability, strong leadership, and commitment from the entire team for it to be successful.

1. Remove any internal barriers

Regardless of management intent, adopting an information-driven strategy can still face internal barriers that can stifle these efforts and put the business at risk. These can be anything from outdated hardware to operational silos that restrict the flow of information. All areas of the business must be prepared for the new approach to data, and teams may have to undergo training to learn how to leverage new data tools. The business benefits must be clearly communicated to warrant a cultural shift away from legacy processes. 

2. Support your staff

If you are just starting on your journey to becoming information-driven, your staff will likely require training. The ability to interpret, visualize and present data is vital for any information-driven strategy, so making sure that all your employees receive training that is appropriate for both their skill level and job role is crucial to data literacy and therefore, business success.

Once an information-driven strategy is in place, business leaders must regularly check in with staff to ensure that the teams are equipped to make decisions based on data effectively.

3. Create a central internal resource

This is important so that everyone in the business knows how and where to access data, what data standards must be adhered to, what the context is around that data and how to format and structure it. These aspects of data management are key to ensuring that the decisions made based on this data are both accurate and reliable. 

4. Be patient

Becoming truly information-driven will take time. Nurture the process by starting small and measuring the results of your decisions so that you can adjust your strategy accordingly. Implementing a tactile approach will prove valuable in the long-term as employees will learn the true meaning of an information-driven strategy.

Reaping the rewards 

To become information-driven requires more than just a cultural shift. Overcoming potential barriers to progress an information-driven culture merits substantial investments for the benefit of your business and your teams. However, if done right, the dividends will be well worth it and the results will be clear for all to see. 

Stéphane Kirchacker, Vice-President for EMEA Operations, Sinequa

Stéphane Kirchacker is Vice-President for EMEA Operations at Sinequa. His objective is to accelerate Sinequa’s growth in Europe, capitalizing on the rising demand for intelligence search and analytics. After holding Exec positions in data management companies, either in London and in Palo Alto, he’s now based in Paris.