In the fast-paced and ever-evolving world of business, making well-informed decisions is critical for success. That’s why it’s important to rethink the way you reach decisions within your organisation. If you typically rely on group input, or follow individual intuition, you may want to consider the benefits of utilising data to help you make more informed and effective decisions.
This is where data-driven decision making (DDDM) comes into the picture. DDDM is the process of using data to evaluate, determine, and validate organisational decisions before taking on a new course of action. Used by companies globally to help drive business growth and overcome human bias in decision making, DDDM is quickly becoming a staple in the decision-making process.
While data in its raw form doesn’t offer much insight to an organisation, undertaking an analysis of data can uncover valuable insights within a business environment.
The barriers to understanding data.
In 2023, organisations are collecting more data than ever before. The Australian Government estimates that by 2025 there will over 176 zegabytes of new data generated annually. It’s not surprising that managing this data will prove a significant challenge for most organisations. So, what can you do to better understand your data?
1. Utilise the experience of data scientists to gain valuable insights from complex datasets, such as qualitative and quantitative data
2. Keep your data secure with the right access controls
3. Have a strong understanding of the data your organisation collects, including its sources, accuracy, relevance, and any biases or errors
4. Use more than one type of data to gain a holistic understanding that encompasses objective measurements and subjective insights
Understanding your data is half the battle - but when the battle is won, it will prove invaluable.
The benefits of utilising data in your decision-making strategy.
Now that you have a deeper understanding of your data, it’s time to think ahead to the benefits it will bring to your organisation’s decision-making process. Utilising data to guide your strategic business decisions helps you:
- Foster a culture of digital education and literacy, empowering teams to make data-driven and logical decisions rather than decisions based on ‘gut’ feelings
- Increase collaboration and productivity by encouraging teams to work towards the same strategy goals
- Share accountability with transparency across your organisation around how choices are made and why
- Leverage data science to pinpoint internal and external risk factors, including operational inefficiencies and opportunities for cost-saving
- Planned data-driven decision making helps organisations fully understand their market and business environment. Through data-based insights, organisations can spot trends, identify gaps in the market, and find new business opportunities to sustain long-term growth.
The role of AI in data-driven decision making
With the rise of artificial intelligence (AI) over the last few years, it’s good to factor AI into your decision-making strategy. As technology evolves, it will continue to change how we resource and manage data, and in turn change how you utilise data in the decision-making process.
The AI available today can help in many ways by:
- Processing vast amounts of complex data quickly to uncover valuable insights and patterns
- Create interactive data visuals that make it easy for decision makers of all levels to understand organisational data
- Profess data in real-time to help organisation be more agile and responsive
- Accurately make forecasts based on historical data to enable organisations to be more proactive in decision-making
- Automate manual data analysis tasks, freeing up valuable resources and time within your organisation
- Make sense of unstructured data sources, such as social media and customer reviews, through Natural Language Processing (NLP)
Embracing the power of data
Ultimately, in today's rapidly evolving landscape, organisations that prioritise data-driven decision making will gain a strategic advantage over competitors - especially in times of market disruption.
To truly embrace the power of data, organisations must:
1. Adopt an enterprise-wide strategy to ensure all employees and decision makers have access to the data and insights that they need for DDDM
2. Embrace advanced analytics technologies, such as AI and Predictive Models
3. Create a culture of curiosity, experimentation, and openness to change that empowers organisations to explore data, challenge assumptions, and uncover new opportunities
To learn more about how your organisation can effectively manage and use data as a valuable asset, contact our team at Business Aspect, a Data#3 company. We provide expert support and solutions to help organisations leverage data for strategic success.
