If you follow a lot of marketing people or SaaS providers on social media, you will be familiar with:
- People telling you how they are data-driven marketers.
- Businesses telling you their product can help you make data-driven decisions.
These people and businesses are not as bad as people who call themselves rock stars or ninjas for doing their job. After all, being data-driven is a worthwhile objective. Yet, using data to help your business succeed is far more than buying a subscription to your favourite data analysis software and vainly adding it to your list of "Partners" on your homepage.
What does it mean to be data-driven, and how can you become data-driven in the right direction in 2021?
What is a data-driven company?
Data-driven companies analyse and interpret data to inform strategic decisions and the direction of their business. Truly data-driven companies use data to both improve their internal processes and culture as well as the levels of service and performance they offer to their customers.
How to be a data-driven company in 2021
Having read that definition, I can hear you all shouting "we do that already" through your screens.
Before you pick up your digital pitchfork and have me cancelled, I have no doubt you do!
What you should be looking to do as you drive your business forward in the next 12 months is to fine-tune and truly define what being data-driven means for your business.
Here are six things to focus on.
1. Work with the right data formats
It is vital to realise you can be data-driven in pursuit of different objectives.
For example, being data-driven in a marketing context typically means you use platforms like Google Analytics or Hotjar to understand how people use your website.
Yet, you can also be data-driven by choosing platforms that use automation and other features to deliver specific functions and services.
For example, here at Contractbook, we use the data-rich JSON to deliver data-driven contract automation. It is all about using the right data formats for your needs!
Understanding that being data-driven can mean far more than using an analytics platform or looking through reports can be a game-changer for your processes. Consider the data formats you, and the SaaS you subscribe to, uses, and how this can benefit your business.
2. Check the ways you're collecting data
Ask yourself these questions:
- What data do you collect and use?
- How do you collect the data you use?
- Do you rely on data you collect yourself, or do you use data from another source to perform specific tasks and automations?
It is easy to follow the same path you have always walked. While the data you do collect may work for you, does it have the potential to be even better?
Take Google Analytics as one example. Tens of millions of websites use the free version of this platform. Yet, many people aren't aware of the limitations of Google Analytics. Some people probably make do because it is free, and they do not want to pay for an analytics platform.
Whether we are talking about marketing analytics or being data-driven in other ways, such an outlook is unambitious and borderline criminal.
Why would you make do and not want to generate and have access to even better-quality data, enabling you to make better decisions?
Check the ways you collect data and question whether these help your business reach its potential. If investing in a better platform to make being data-driven work better for you is what it takes, do it.
3. Be data-informed as much as you are data-driven
Can being too data-driven be a bad thing? It depends on your approach.
If you use data as the sole influencing factor over all your critical decisions, the answer might be yes.
This is why being data-informed as much as being data-driven matters.
Do not merely look at data and make decisions using numbers. Consider the context behind the data. Use the data to challenge assumptions and beliefs. Use your own ideas to challenge the data!
When working with data yourself rather than for automations or other tasks, you must go further than only using data to justify everything you do.
4. Choose the metrics you focus on with care and in line with your objectives
Having access to high volumes of rich data is excellent. Yet, it is all too easy to focus on things that do not matter, and that may even harm more vital metrics.
Say you are working with HR software to help you with your recruitment processes. The primary aim of recruitment is to hire great people. Even if you hire great people, you might decide you want to attract more applications or different types of candidates, and so use your data to change your recruitment strategy to meet these aims.
But what if doing this makes it harder to find the right people?
This is a cautionary tale. There is always room for improvement, but do not let data guide you down a path that will not deliver you any benefits.
5. Use a rounded reporting process
One of the trickiest elements of working with data is that you can interpret data differently depending on how you view it.
There is an argument for using consistency in reporting. But what if your reporting facilitates blind spots?
You could end up changing or doing things you do not need to do. You use data to justify the decision, but if looking at the data differently would have led you to make a different decision, your analysis is flawed.
Consider data from different angles before you decide how to use it.
6. Use data internally and not just for clients
Businesses are much better at using data for the benefit of their teams than they used to be. Still, it is always worth revisiting and ensuring this is part of your internal culture.
Being data-driven is a crucial part of the service you deliver to your clients.
Where you can use data directly for automating tasks, eliminating administration, and making your teams happier, take advantage of it!
Remember, data-driven companies improve internally as well as in the way they serve their customers.
Having success as a data-driven company in 2021
We have never had better access or the ability to use as much data as we do today. What's more, the volume of data we have is growing by the second.
You have everything you need to be a data-driven company in 2021 and beyond. It is in how you use and interpret the data you have access to, rather than the information itself, that will determine whether you are successful. Accessing data has never been easier, so you must take a considered, and innovative where possible, approach to how you use it to put your business ahead of your competitors in the next 12 months.