As it appeared in the Daily Nation on December 3rd 2019
Dr. Lucy Kiruthu
Since time immemorial, smart businesses have used data. They have used data to guide their business decisions and to identify opportunities for improvement. For example, businesses have analysed financial information to uncover valuable insights on incomes and expenditures. They have also done so to better manage their future financial performance. Analysis of financial information is an example of data analysis. However, data analytics is a much broader term. Data analytics goes beyond the analysis of data to the tools and techniques used to make the raw data across the organization usable.
Besides financial information, businesses generate mountains of data. In the last two decade, the world of business has witnessed major transformations in how data is captured and used in business. Technology has made it possible to collect voluminous information associated with almost every aspect of a business. Previously data was analysed manually or using simple systems and techniques. Today, most of the data analytics processes are automated. As such, data is often automatically captured, analysed and reports generated in real-time. The possibilities in the capturing, analysing, reporting and usage of data are virtually endless.
Courtesy of technological advancements, data is being captured more than ever before. Many companies have heavily invested in a digital infrastructure to run the business, systems to steer operations and tools to support digital technologies. Despite these investments, many businesses have not yet been able to leap the full benefits of data analytics. Converting data into useful information remains a key challenge. According to Forrester Research Reports, up to 73% of business data is not even analysed. How much data is your business generating daily? How much of that data is being analysed to discover useful information and insights? Is data analytics helping you in decision-making?
Business leaders need to harness the power of data by appreciating how data analytics drives business performance. I love data and I see great potential in its use. I soon want to see a store that helps me analyse my annual grocery shopping on an app and uses that same data to manage their supply chain. Before those keen on data can even share more on big data, machine learning or algorithms and confuse business leaders we need to go back to the basics of data analytics. This means challenging business leaders to make better use of the small quantities of data they already have. Is the data we have quality data? How can that data be useful to our businesses? Determine what data you already have and identify the kind of reports you need to inform your business decisions. Every smart business should consider integrating the infrastructure that supports run its businesses into a single good database as a priority. This is because when a business has a single good database it is easier to process the data. Such a database also gives a single view of the customer.
Today, many smart businesses are using digital technologies in transactions. Consequently, they have access to voluminous transactional data. Unfortunately, very few businesses are utilizing that data to make accurate and reliable decisions. Business leaders need to pay more attention to data and its use. Only those who will do so are likely to discover useful information and insights to drive their business performance. Insights from data will remain a principal driver for business growth!
Dr. Lucy Kiruthu is a Management Consultant and Trainer. Connect via twitter @KiruthuLucy