What “data-driven” means and how to use it to excite stakeholders
Where and how data drives value
The number 1 way to use data derived value is obviously to embed data in decision making and drive up decision making, accuracy and speed. In order to do that, you have to understand the business questions that your executives are asking and supply them with great information that supports that and gives them more trust and confidence in the decisions that they’re making for your organisation.
Costs, customers and opportunities triad
The next way is to try and gain control over cost and spending metrics using data as well as understanding your customers to drive up increased loyalty and spending from those customers. One way to do that is to use data to identify new markets and growth opportunities, perhaps by getting data from partners or external data.
Clearly, there are risks in your business today and reducing fraud and eliminating other business risks, especially risks around data compliance, things like GDPR fines is one way to drive value to the organisation and prevent unnecessary costs.
Creating better products and services for your customers. Look at data signals that tell you what your customers like and dislike, and then use that to tune the type of products and services that you offer.
Monetising data has been made popular and promoted by Doug Laney, and his book Infonomics is a fantastic primer on the subject. But in reality, think about how you might sell your data because remember, it’s the most unique asset that you own or trade that data, barter the data with your partners or your customers to generate new revenue streams you don’t have today.
Making sure that your employees are happy will help reduce churn and help reduce onboarding costs. So use data to look at how to drive up engagement and satisfaction amongst your employees.
Lastly, use data to drive up efficiency across your critical business processes. This is where you can look at improving your transactional data to make sure that the handoff between different business entities and silos is as smooth, seamless and interoperable as possible. That will help you drive up efficiency, drive down costs and create a happier enterprise.
So by using these 9 different ways that data can drive value in your organisation, you should pull them together into a data strategy that is aligned against the business strategy and objectives that your organisation has. And that will allow you to clearly articulate how much value the data is bringing to that business strategy.
More about data strategy
Our in-house research last year showed only 32% of the respondents we spoke to had a data strategy in place. Less than half of the organisations out there are reporting that they’re driving innovation with data. So by considering how your data can support critical business objectives, you will be helping your executives to become more data-driven, make better decisions, drive up revenues, drive down costs and eliminate risks.
Who has a data strategy?
Well, not many. Only 32% of the total participants surveyed either have, report progress against or aligned their data strategy to their strategic aims. – More on data strategy in our later lessons.
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Read Doug Laney's book Infonomics to learn more about the art and science behind accounting for data.