13 of the Best Finance Tips for Business Owners

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Posted by Alex Jone - 14 February, 2019

How You Can Create a Data-Driven Culture

Businesses are experiencing an interesting parallel between the ever-evolving technological innovations causing disruptions in the business world while a greater focus is being shifted toward developing a strong organizational culture.

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 Focusing on data and analytics is no longer only relevant to the tech industry. All modern businesses must investigate how they can leverage data and turn it into valuable information that drives strategic decision-making. This can be achieved by creating a data-driven culture.

 

What is a Data-driven Culture? 

A data-driven culture is an organization that does things by the numbers. In other words, the ability to procure, transport, and use data and information effectively is a priority within the organization. Additionally, while the data may drive the organization forward, leadership recognizes the importance of its human resources in setting the wheels in motion and keeping processes moving along smoothly.

A data-driven culture makes decisions and sets goals surrounding the information they are able to draw from various data points. To have a data-driven culture, education and time-management skills are essential. Here are some tips for creating a data-driven culture.

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Invest in Data Literacy 

Many businesses are experiencing unprecedented challenges in change management and adapting to modern business practices as the Baby Boomer generation retires and the Millennial generation moves in. While everyone will always have a different skill level in a given area, it’s essential that organizations not only invest in bringing in data literate professionals but that they also invest in educating internal employees.

Creating a data-driven culture means teaching everyone how to do the things they need to do to bring the business into the 21st century. Whether that’s learning how to extract data from PDF files or manipulating big data into useful information, everyone needs to have the same foundational understanding of what’s required and why they’re doing it.

 

Align Data with the Business Mission

While the how-to lessons of capturing and using data are important, the why will ultimately be the motivation that encourages employees to get things done. To create a data-driven culture, leadership needs to define the goals of becoming a data-driven organization and align those goals with the overall business mission statement or vision.

Many businesses claim to capture big data, but fail to use it out of data overwhelm. It’s estimated that 50-80% of time spent with big data is manipulating it into something useful. As such, it’s no wonder that many organizations retain data, but fail to use it to its full potential.

Organizations need to set clear objectives and success metrics, creating a project plan for setting processes in place regarding the education and management of big data. Once the goals are set, the organization can look at how they’re going to capture and store the data, and what changes need to be made at an operational level to capitalize on this process. Only then can they start to set aside time to use the data effectively.

 

Improve the Overall Company Culture

One of the main challenges organizations face in the technological world is to build a strong, human-centric company culture. Many employees are in silos or isolated from their peers while sitting in front of a computer screen. Traditionally, the term “silos” in business was seen as a broader, more departmental division. Now, it creates cracks in the company culture on both a personal and departmental level.

By creating a collaborative environment between employees and departments, businesses are opening up access to information across the business. Interdepartmental collaboration allows for an unhindered flow of information and a high-level view of the organization for both executives and front-line employees.

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Use the Data

Finally, organizations need to use the data they collect to drive decisions rather than letting it collect dust. As having deeper data insights might take the business in unprecedented directions and contradict previous findings, it can be an uncomfortable change to make decisions by the numbers, focusing more on the science of business than the art.

To use the data effectively, the data-driven decision-making process should start at the top. Leadership should set a precedent, allowing for the change in procedure to trickle down through the organization. This might mean bringing in a consultant who can help ensure that the goals are aligned with the business and help foster the mindset shift associated with creating a data-driven culture.

 

The Proof is in the Numbers

Using the data, and treating it as a tangible asset is essential for success. For an organization to survive and thrive, innovative and forward-thinking leadership must be in place to shake up the status quo.

Organizations that take a data-driven approach, using behavioral insights about what motivates customers and how they convert from a lead to a sale, tend to be 85% more successful in terms of sales growth than organizations that leave the data untouched. Organizations can no longer afford to ignore this important asset.

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Topics: Technology, Management

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