Making Data-Driven Decisions for Your Business
by Ginny Grimsley, on Nov 3, 2021 8:00:00 AM
(last updated May 4, 2022)
It’s common knowledge that organizations that analyze their data to make business decisions have a competitive edge over those that go with their gut.
And even though most business owners understand the need to utilize data to make decisions about their businesses, fewer than half actually use it—even though data is more abundant and easier to access than ever.
To grab hold of this competitive edge yourself, read on for the what, why, where, and the all-important HOW of data-driven decision-making.
You might wonder what business decisions you can make using data. At the end of the day, "data" is just information businesses have always used to make decisions like market and sales projections, customer retention percentages, and cost analysis.
Now, it's just more accessible to everyone, and it's a perfect way (and often, the ONLY way) to make decisions about:
- Money: Find the most current, cost-effective way to hire new team members or the most competitive way to advertise a new product or service.
- Growth: Figure out the best way to prevent churn or delight customers.
- Marketing & Sales: Determine the most effective ad channel or sales activity.
- Customer Experience: Identify the best way to handle support tickets or improve response time.
Making decisions using data isn’t as complex as it used to be.
For example, a small business owner in the past wouldn’t have been able to utilize data because it was expensive, time-consuming, and only accessible to corporations (so competing with other small businesses without data was possible).
Now, with the invention of cloud-based CRMs, you don’t need a data scientist to understand the metrics you need to know to make big decisions.
Therefore, if you’re not using data, you’re being left behind.
Start with a clear plan of action that details how you’ll find and interpret the data you need to make the right business decisions using these 6 steps.
- Prioritize your objectives
- Identify relevant data
- Analyze your data
- Create a strategy
- Measure success
- Rinse and repeat
Let's take a more in-depth look at them.
1. Prioritize your objectives
Ask yourself what specific business goals you want to improve, and choose the top two to start.
Whether it’s boosting international sales, speeding up the customer service ticketing processes, or retaining team members, you can find data to help you decide how to best approach the problem.
2. Identify relevant data
Find a data solution that shows you historical data that's relevant to your specific objective in a way that you understand so that you will be sure to make the most use of it.
A cloud-based CRM is the first place to look because they’re intuitive, shareable with your team, and easy to access from anywhere on any device.
3. Analyze your data
Take a look at the numbers to identify any historical trends that could help you make a decision.
With a CRM like HubSpot, trends are identified with graphs that anyone in your organization can read, allowing key stakeholders to weigh in on decisions that affect the company to avoid data silos.
An added benefit of data access is increased ownership by the very people who enact positive change in your business—your team.
4. Create a strategy
Once you’ve made a data-driven decision, and you know what you’d like to accomplish, create a plan that includes specifics: what needs to be done, by whom, when, and what outcome you expect.
5. Measure success
This is where data truly earns its rewards. When the deadline for your decision arrives, compare the new metrics to the historical data to see if the trends are positive. If so, great!
If not, at least now you know that it didn’t work so that you can self-correct quickly.
But, again, this is often more valuable information than anything you learn from positive decisions.
6. Rinse and repeat
Keep it up! You’ve got this.
As you become more comfortable with using data tools, you’ll begin to see how quickly you can maneuver around issues, celebrate successes, and open up new opportunities for growth in your business.
One of the best places to get data is from a responsive, integrated cloud CRM.
A CRM like HubSpot gathers data related to website visitors, leads, prospects, revenue, marketing efforts, and more into one easy-to-navigate platform, complete with dashboards that also tell you what it all means.
Growth is a HubSpot Platinum Solutions Partner, and our team of certified experts can help you access your business data with a fully customized CRM. Ask us how we can help you make the most of data to grow your business.