Every business, before jumping on the data collection bandwagon, need to develop a data strategy. Any company that is collecting data without a coherent strategy needs to pause and develop one.
On the one hand, it is rather impressive that technology allows us to gather huge amounts of data, but on the other hand how much data is collected by companies before they ask “What do we do with it all?”. The reality is, much of the data collected by organizations just isn’t useful.
Every business, before jumping on the data collection bandwagon, need to develop a data strategy. Any company that is collecting data without a coherent strategy needs to pause and develop one.
There are lots of ways that data can have a positive influence on the prospects of a given business, but there are three main ways that businesses can use data and information:
- Inform then improve operational decisions
- Reform and refine operations
- Create additional revenue streams
The majority of companies start by using collected data to improve their decision making. This is because it is more resource-intense to tackle all three of the above at once.
Inform then improve decision making
According to Bain & Company, after analysing over 400 organisations, those with above-average data analytics were up to five times more likely to make faster operational decisions.
Making better, more informed, operational decisions should be the first way that all businesses should be leveraging data intelligence. Data can help with decision making in all aspects of a business, from warehousing solutions to distribution, and from marketing to customer service.
Organisations need to identify and then prioritise business queries and determine what types of data can help get answers to those questions.
One of the most common ways that organisations are gaining business insights from data and information is to gain a better understanding of their customers. This may seem obvious, but it is something often overlooked.
Reform and refine operations
There are lots of opportunities available for businesses to leverage data to optimise their operations. Just about any process in a business that creates data, whether through customer interaction or production line processes can be refined on the data generated.
One priority for a lot of companies is to make use of generated data so they can improve efficiencies. For instance, businesses in the service sector might use vehicles equipped with GPS devices. These can all be connected to gain additional insights through real-time monitoring. One way this could work is by the devices alerting one another with traffic updates so drivers can avoid jams.
Create additional revenue streams
The more compelling data collection is, the more attractive that data becomes as an asset. This is proven in the way that businesses are bought and sold on the backs of the data they have collected. For instance, in 2015 IBM purchased The Weather Company, purely because IBM wanted access to the huge amounts of data they had acquired.
Even if a business is not looking to get itself acquired, the accumulated data is still valuable. There may well be secondary markets for the data gathered. For instance, Fitbit has now become something of a data merchant - they are now starting to capitalise on the fact that the generated data is valuable to other organisations.
No matter where a company happens to be with regards to data collection, they have to be sure that they have a robust data strategy in place.