4 Ways to Leverage Data for a Better Business Strategy
How do companies innovate successfully? What’s the secret sauce behind sustainable growth? How do you build a thriving corporate culture? There’s no silver bullet to answering these questions. But there is a common thread among companies that innovate, grow, and build a thriving culture successfully: the ability to leverage data to drive decision-making.
According to a recent Tableau survey, companies that effectively use data analytics and data-driven decision-making increase revenue and profits by 8% and reduce costs by 4%. This likely doesn’t come as a surprise—it’s widely known that data has the potential to accelerate business success. That’s why so many companies want to improve their data analytics capabilities. The challenge is that, while companies have access to a lot of data, many are unable to truly use it to their advantage.
To leverage data effectively, it’s important to embrace data governance and data management. With a holistic, strategic approach, you can unlock new possibilities and use data effectively throughout your organization.
Hurdles to Leveraging Data Successfully
Despite having access to large amounts of data, many companies struggle to leverage data to create strategies that align with their business objectives. Oftentimes, organizations are focused on more immediate and urgent challenges like customer satisfaction, competition, and regulatory compliance. Client-facing feature projects, operational efficiencies, and daily fires compete for their attention, and data projects get deprioritized.
Because data management and governance take a backseat to other initiatives, data is often managed reactively. Analysts can be disconnected from those who need to use data, making it hard to identify issues and find solutions to them. Data is siloed and it’s difficult to make connections between data points to generate actionable insights. When companies do initiate data projects, they’re typically reactive one-offs, and aren’t designed with the broader data management strategy in mind.
4 Ways Better Data Capabilities Improve Your Business Strategy
Other company initiatives may seem to be more pressing than improving your data capabilities, but leveraging data effectively can help you produce better business outcomes, including for those projects and programs that may seem like a higher priority.
1. Understand your customers better
Customers (both B2B and B2C) increasingly expect companies to deliver personalized experiences. Leveraging data enables you to understand your customers better so you can implement strategies that allow you to engage with them at the top and middle of the funnel and promote loyalty once they become customers:
- Gain insights that help you understand customer sentiment. Change in customer sentiment may be caused by many different factors. Surface analysis of reviews and survey data may reveal little. Thorough data analysis allows you to root out the true sources of customer concerns.
- Anticipate your customer’s needs by building comprehensive customer profiles. With a comprehensive customer profile, you can identify the products and services that they’ll be interested in and create the right marketing strategies to reach them. Use data to both discover your segments and then tailor their experience.
- Create seamless omnichannel experiences. Whether they’re on your website, calling customer service, or interacting in person, customers expect you to have the most accurate, up-to-date information on their account. A 360 view of customers enabled by master data management is essential here. Create robust self-service tools and provide frontline employees with the right information to ensure a seamless customer experience.
2. Tap into your employees’ needs more effectively
Like customers, employees want personalized experiences from their employers. Companies often rely on surveys to track engagement and gather information on their needs, but that’s not the only relevant data available to you. For example, tracking health and wellness data (with considerations for privacy) can help you provide more personalized wellness programs and make tangible improvements in work-life balance.
With integrated data and better analytics capabilities, you can also leverage data to connect the dots on common employee challenges:
- Investigate causes of employee turnover. Track turnover across various segments (such as new hires and top performers) and understand the broader context around why employees stay or leave.
- Improve diversity and inclusion. Go beyond simply tracking employee demographics. For example, you can monitor how quickly diverse employees move up the ladder or view diversity and inclusion metrics by region or division. That allows you to create targeted strategies to improve outreach and address bias.
- Improve employee performance. Centralize key performance metrics in one place, which allows you to build coaching programs that address the key drivers of performance.
- Understand onboarding effectiveness. Measure how long it takes employees to become productive after onboarding and drill down into factors that may affect performance, such as their department or the length of tenure of their manager.
3. Identify successful and sustainable growth strategies
Sixty-one percent of companies with mature data practices enter new markets successfully. Behind their success is the ability to leverage data improve R&D efforts and implement the most viable strategies:
- Identify growth opportunities across the customer lifecycle. Identify new opportunities to offer customers value and forecast how they’ll impact revenue.
- Prioritize opportunities systematically. Perform a cost-benefit analysis on each opportunity so you can identify which ones to pursue first, and when to pursue them.
- Optimize the customer experience across all channels. Ensure that each rollout — whether it involves a new product, market, or customer segment — is optimized to be seamless for the customer and generate ROI for the company.
- Provide easy ways to log and track feedback. Make it easy to collect and centralize feedback so you can measure the effectiveness of your new strategy and adapt when needed.
4. Improve agility
Confronting change is a constant challenge. Agile transformation is a great way to address this reality, since agile organizations outperform their peers and are more likely to resist disruption. Leveraging data effectively is key to agility:
- Base decisions on data. Using KPIs, OKRs, and key outcome metrics provides an objective guide to decision-making. Choosing and then trusting the right data to continuously monitor your industry and business will alert you to changes and trends.
- Create strategic internal partnerships. In agile organizations, departments like HR and finance are seen as key strategic partners. They rely on data to deliver insights that inform business strategy. For instance, leaders across the business rely on finance for forecasting and analysis, and HR is tasked with addressing an ever-growing swath of issues, including employee performance and well-being.
- Empower employees to problem-solve quickly. Employees at all levels face new challenges every day. Access to comprehensive data makes it possible for them to identify root causes, model future scenarios, and respond quickly.
How to Improve Your Data Analytics Capabilities
The challenge of leveraging data more effectively can’t easily be solved by collecting more data and hiring data analysts. Without a guiding strategy, the data and the analysts won’t perform to their highest potential. It’s important to improve data governance and data management practices to enhance data maturity and use information more effectively across the organization.
That’s what we help our clients do at Kenway. In fact, we helped one software firm improve its analytics capabilities by building a business intelligence roadmap, implementing standardized reporting, building and interpreting reports, and establishing the framework for sustainable value realization.
Do you want to use analytics more effectively for your business, but don’t know where to start? Kenway can get your analytics engine up and running. To learn how, contact us.