Quick, what companies come to mind when you think of using big data for business improvement? Google? Amazon? Microsoft? You’d be right, but not entirely – because it’s no longer only large enterprises that can benefit from big data. Today, smaller companies are also realizing the value of data. I’d like to share with you how our small-business clients are using big data – and offer some guidance for steps you can take to start putting data to work for your business.
I’m using the term “big data” to refer to data of enough volume or complexity that it’s not really possible to manage it manually. These days, even small businesses can collect enough data that storage and management will pose a challenge.
It’s not just how much data you have that matters, though. It’s also how accessible it is and what you can learn from it. Three things are driving the widespread use of data in business of all sizes today:
- Data collection: In a digital world, you have many opportunities to collect data – everything from customer information on order forms to financial data in accounting and other systems.
- Data accessibility: Mobility and the cloud make it possible to access data from anywhere (and to access it in real time).
- Data analytics: Business intelligence (BI) and related applications are readily available to help you draw conclusions from data and apply what you learn to business improvement.
The challenge is in being able to easily glean insights from data and leverage those insights. Here’s some guidance we’ve come up with based on our clients’ experiences.
Start with an informal analysis of the data that’s critical to your business.
We advise clients who ask us how they can make better use of their data to start by evaluating the data that drives their business. What is it? Where is it? How could it benefit the company? Who needs access to it (and when)?
Here’s a concrete example: Let’s say you have a remote sales force, and you update your product pricing sheet every morning. How do those remote workers get access to that data? Are you emailing them copies of the information? Can they log in to get it remotely? Mapping out the flow of data through important processes in your organization and looking at what it tells you can impact business results.
One of our clients is a services company that offers home improvement services. For a long time, they kept all their pricing information in Excel spreadsheets that they emailed to their remote sales force once a week. We helped them think through how the process worked, and they began to realize it was creating a lot of errors and inefficiencies. They weren’t updating pricing often enough, and sales people were frequently confused about which version of pricing was current.
Think about how you could use data differently – and better.
One thing we often experience with clients is people getting intimidated by the idea of data analytics, because they don’t know much about it. We try to show them that it’s not about the technology; it’s about what you can accomplish with it.
To return to the example of the home improvement services company, we helped them to recognize the inefficiencies in their spreadsheet-based process for sharing pricing data. We introduced them to some cloud-based solutions that would enable them to switch to a more agile pricing system they could update in real time – and that their remote workforce could easily access on the web.
As a result, the sales force is now able to consistently access accurate, real-time pricing information without having to look for it in a spreadsheet that might or might not be current or correct. That ability means they’ve been able to increase revenue because they’re now able to sell more products at the right prices with far less effort.
Listen to what the data tells you.
No, you don’t have to be some sort of data whisperer – that’s what business intelligence and data analytics applications are for. But you do need do to think about what the data can reveal to you, so you can find the right key to unlock insights. We help with this all the time.
For example, take a service-based company that has an invoicing system full of data about what clients buy, how much they pay, and how much it costs the company to sell to them. What would be the value in being able to figure out what the margins are across its clients on a particular set of services? That’s what the data can reveal. And in the case I’m referring to, applying appropriate analytics to the data revealed that several customers were paying far too little for the service they were getting – or, to put it another way, getting far too much for the amount they were paying.
Once the company realized what was happening, they made the strategic decision to meet with the clients whose pricing was affecting the company and present their case for increasing prices. Every single one, after being shown the evidence that that they’d been enjoying something of an unfair pricing advantage, accepted a reasonable price increase and stayed with the company – which was able to significantly increase its monthly revenue as a result.
What about the data that drives your business? Is there a way you could be working with it more productively, or a way you could use it to make your business more effective? If you’d like to learn more about how to find answers to questions like these, let us know. We’re always happy to help.