In this article, we will discuss the benefits and challenges of having a data-driven culture.
You may wonder, if we are for companies having a data-driven culture, why would we bring up the challenges? Well, we believe that there are pros and cons to every strategy. While we wholeheartedly have faith in having a data-driven culture as the right move for companies trying to make a difference and impact revenue, we also want all companies to make that choice with all of the information they can.
The challenges:
Can it be too expensive?
If not done right, a data-driven culture can be expensive. We say this because if you spend too much time building a culture, but do not have the right data or the right people, the culture itself won’t produce the results. It is the marrying of the culture, the right questions, and reinforcement from the right people for it to give you the results you desire.
Can data be misleading?
It can be misleading if you don’t have the right data or you aren’t asking the right questions. So how do you know if you are asking the right questions which are leading you to the right data? The best way is to determine what set of business decisions you want to make with that data, and then determine the questions that inform those business decisions.
Can the tools be confusing?
Yes, the tools and choices of tools can be really confusing, especially if you haven’t well designed your project, the questions you are asking, and have a deep understanding of the data that you need in advance of making that choice. Too often, we have seen companies choose a tool and then live with its limitations because they made this choice too early in the process. Make sure you wait until you know what your needs are before taking a look at the tools available to you.
Ultimately, if you don’t have the expertise in-house you may want to consider a partner to help you outline your project, do proper discovery of the right toolset and mitigate expensive mistakes. We can always help with a free assessment of where you are. Book Here.
The Benefits
30% more increase in annual revenue
Yes, you read that right. Companies that are leading with a culture that is exceptionally data-driven can benefit, according to Forrester, with 30% more in annual revenue. Who wouldn’t want to see that? In itself, having a more data-driven culture can be a revenue-increasing strategy.
Manage Shifts More Effectively
Business is constantly changing. With data at your fingertips, you can see trends well in advance by being predictive vs. reactive. This is the difference between looking at revenue reports and things that have already happened in the past vs. looking at trends and indicators of what is coming in the future. When your culture is wrapped around being data-driven, you use predictive measurements and early indicators to sound warning alarms before something happens.
Become More Effective
Who doesn’t want to be more effective! Imagine a world where you can focus on the right things that will propel your business forward vs. climbing through data and trusting everyone's gut to do the right thing for the business. In this competitive landscape, we are in today, we don’t have as much time for trial and error and data helps us discern if our gut instinct is something we should follow or pass on.
Understand Your Customer
When you have better data on your customer's needs you can better align your business services and products to meet those needs. When you do this, you drive up customer Net Promoter Scores and create more predictive revenue streams.
Finding Savings
When you have the right set of data you can be on the lookout for savings opportunities. This can happen in particular with analyzation of your supply chain and vendor management.
You may find, as we have, that the benefits outweigh the challenges, especially when you add up cost savings potential and a 30% increase in revenue. Still, companies approach their data strategy often from the mindset of the skills they need on the team and the tools they need vs. the culture. When the culture is looking to be informed by data and working with it, you create better-informed decisions, you can move faster, and have a heads-up on any trouble headed your way so you can plan your way out of it.
For more on this please view our recorded webinar to begin your journey into a data-driven culture.
You will learn:
Here is the link to the recording
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