Data can help drive your business forward, how you can become a data -driven business?

Many of the world’s smartest businesses use data to measure and improve their performance. Just a little research into your business can tell you how to boost revenue and profitability. By gathering the right data, you can identify opportunities, make strategic decisions, and improve business performance quite quickly.

Data can save you

Data and metrics are vital to your business success.  A data-driven business is one that keeps it real and makes smart, well-informed decisions. They don’t have to resort to gut feel.

How you can become a data-driven business?

It’s not hard to be a data-driven business. It’s just a three-step process:

1. Decide what you want to measure
2. Get the data
3. Review and act on the findings

Decide what you want to measure

With modern business software, you can measure just about anything in your business. Generating business data won’t be a problem. Your biggest challenge will be in deciding what numbers are actually relevant.

Think about your business goals and work backwards from there. If you’re focused on increasing revenue, for example, you’ll need to look at:

• What drives your sales
• The range of products you offer
• Your conversion rate

It is important to ensure that:

• You keep it simple – tracking too many Key performance Indicators ( KPI’s ) is hard work and it makes decision-making difficult
• The KPI’s you track are relevant to your business goals – when a KPI improves, it should indicate you’re getting closer to achieving a business goal

Get the data

Getting business data used to be expensive. You had to hire consultants or use expensive technology. Now small businesses can get the information simply by looking inside their business software.

• Accounting software shows your income and expenses
• Point-of-sale software shows where your revenue came from
• Inventory management software shows how stock moves through your business
• Workflow management systems highlight how much it costs to execute a project
• Time-recording software shows where your wage spend is going
• CRM software will provide you with customer and sales performance information

Review and act on the findings

It’s no good tracking KPIs  ( key performance indicators ) if you don’t act on the information. Schedule monthly meetings with your management team and/or accountant to review the business data. Set goals. What do you want the KPIs to say at your next meeting? When you get to that meeting, check to see if you’ve succeeded. If not, ask why? If they’ve surpassed expectations, see if you can figure out how you did it.

Data supports your decision-making but, even more importantly, it keeps you accountable. It allows you to focus on what’s important in your business and makes you answerable to those things. Use your accountant as a sounding board, they’ll do more than help you set and measure KPIs. They’ll also help you:

• Reconcile KPIs with your overall business budget
• Come up with realistic goals & develop strategies for improving KPIs
• Figure out what’s going wrong when you miss your goals
• Find an accountant that supports data-driven business

Keep it real

Being in business is tough and there are days where we achieve alot, and other days where we feel like nothing is going to plan. Irrespective of your state of mind, business data will keep you real and accountable. If you want your business to get to the next level, start with data. Contact Paul Redmond on 053 9170507 or email predmond@rda.ie to help you become a data driven business.