Posted on 9 October, 2019 | 4 mins
Smart decisions are informed decisions and to ensure that you’re able to put your best foot forward you need to have the right insights to guide you. We consider some key areas of focus that support informed decision making
Knowledge is power, in business, the power to make better-informed decisions. As the data revolution unfolds, businesses are realising the importance of distilling operational and customer-related data into meaningful metrics that can help guide management decisions, drive efficiency and provide a view of how to ensure your business remains sustainable.
Smart businesses are implementing data-driven decisions and strategies – ignoring hunches and opting instead for technology and machine learning to provide better insights that inform business decisions.
Harness real-time business data
Harnessing real-time data has several advantages and uses, not least it gives shrewd business owners the ability to make savvy decisions based on relevant, timely information. Read alongside historical trends – be that for the prior day, week, month or year – you can identify and compare trends, gauge what works, create reports, make projections, and develop strategic business plans.
Technology puts this information at your fingertips, with different business apps supporting different elements of your business. For example, commerce platform Vend not only provides businesses with a professional online storefront with in-built payment and reporting options, and a point-of-sale application, it brings all of a business’ sales, customers and inventory information together in one system. Rather than wading through reams of reports, data is delivered in bite-size segments, so you can see what works and easily gauge your business’ performance.
Decode business analytics to understand performance
Data-driven organisations make better strategic decisions, enjoy high operational efficiency, improved customer satisfaction and robust profit and revenue levels. According to an article in Towards Data Science, they are twenty-three times more likely to acquire customers, six times as likely to retain those customers and nineteen times more likely to be profitable as a result.
The same article highlights the role that data and analytics play in reducing inefficiency and streamlining business operations, observing the benefits of using reporting and analytical dashboards to ‘identify data correlations and provide managers with detailed insights to perform cost evaluations, peer benchmarking and pricing segmentation’.
Business analytics are without value unless you can make sense of them. Again, technology provides a welcome solution. Platforms such as 9 Spokes bring together the various elements of a business by connecting apps and leveraging the data to provide a multi-dimensional view of your performance – all in one place.
Understand your customer with Google Analytics
Google Analytics is a powerful web analytics tool that tracks and reports website traffic and an important decision-making resource for any business. Google Analytics provides information on user demographics, behaviour flows and cohort analysis, and generates reports that give you the capacity to analyse, benchmark and take informed actions.
Google Analytics features include:
Segments is a feature that groups users and provides a view of how users interact with a website. View segments such as direct traffic, bounce rate, new users, etc. or use customised segments to track users who hit different benchmarks in your sales funnel.
Goals are specific actions that you want website visitors to complete. Define goals on Google Analytics to measure the effectiveness of your marketing efforts, for example.
Intelligence events provide alerts when there are surges or dips in traffic, increased bounce rates, higher levels of page views, etc. Also works with goals, notifying you when you achieve one.
Traffic trends allow users to compare traffic from different periods of time to understand website performance and user engagement.
Social media can be monitored through Google Analytics, see which platforms drive traffic to your website, and subsequent behaviour on your website. The analytics tool tracks visitors who immediately convert, but also those who return later to make a purchase.
‘The Ultimate Guide to Google Analytics in 2019’, published by HubSpot, is a useful starting point for those looking to harness the power of Google’s analytics tool.
Managing risk through information
Analysis of your business’ data can highlight trends that may otherwise go under the radar and identify potential issues such as increasing churn rate – the rate at which customers stop doing business – so that you can take the appropriate action. By gathering data from multiple sources across your business you are better able to track cash flow, your credit capacity, operational risk and even asset-liability risk and, ultimately, assess how you’re performing financially, ensure sustainability, and flag concerns before they become issues.
This information means helps reduce the risk of new business. For example, if you’re thinking of expanding your premises you can assess what your projected business growth can support, whether you have the cash flow to support a site extension or to recruit new talent.
Technology provides the tools for small and medium-sized business owners to make the right decisions for their company. The proliferation of apps supporting business functions, that collect data from across your business and distil it into readable metrics that can be used to inform decisions is changing how business is done.