By Luís Gonçalves, Data Analytics & AI Director at Noesis
However, more important than the volume of data an organization has access to, the great differentiating factor nowadays is its ability to extract, analyze and interpret this data, transforming it into relevant information for decision-making. Although more and more organizations are moving forward with initiatives that allow them to adopt a data-driven culture, many are still lagging in this "journey". Organizations with low maturity levels in data literacy and where data still needs to be an essential tool for business development.
But what does it mean to be Data Driven and what is its importance for the business?
Data-driven refers to a strategic process driven by data, capable of identifying new business opportunities, improving customer experience, increasing sales, and making operations more efficient, among other objectives. Adopting a data-driven philosophy allows organizations to make strategic business decisions based on concrete evidence and data that corroborates or refutes those same decisions, making the decision-making process increasingly "scientific" and informed. The opposite is decision-making based solely on speculation or intuition. According to a McKinsey Global Institute study, data-driven companies are 20 times more likely to acquire new customers and six times more likely to keep them. You need to build a structured and trustworthy data ecosystem to achieve this. Investing in expert data professionals and the technology tools that help derive value from data and turn it into genuinely relevant insights for the decision-maker is critical. In this sense, I identify three benefits of adopting a Data-Centric culture for organizations.
1. Better Customer Experience
Today, organizations have at their disposal a set of data that allow them to reliably assess their customers' behavior, consumption habits, and interests, making it possible to anticipate their needs and, on the other hand, to adapt their offer and/or response capacity to what their customers are looking for. Data can help organizations become more profitable, address their customers' real "pains", reduce resolution times, and increase customer satisfaction.
2. Increase Sales and Improve Processes
All companies work towards one goal: to be as efficient as possible. Maximize their revenue growth with a suitable investment. In a global market, data plays a crucial role in identifying and interpreting business opportunities and diagnosing some process problems, performance, positioning, and offer, among others. With access to the correct data at the right time, the leader can more quickly identify these situations and develop the appropriate strategies to mitigate them
3. Greater Agility and Quick adaptability
Having the ability to predict market trends can represent an advantage over competitors. A data-driven organization will therefore become more consistent in its strategies. A data-driven culture helps employees in their decision-making processes, makes organizations more agile, more adaptable to the market, and, as a result, more relevant in the eyes of their customers. When data is correctly interpreted, it's easier to understand what's coming and respond more quickly. Indeed agile organizations are more likely to achieve superior financial performance than the average company. Therefore, managers must understand the importance of data to their organizations and be the 'driver' for adopting a genuinely data-centric culture.
Data offer very little to organizations if they do not have resources capable of analyzing and interpreting them. Conversely, a philosophy in which data is at the heart of the business will allow more value to be derived from it and will mean a giant leap in an organization's competitiveness. Informed decisions necessarily lead to better business performance.
Published (in Portuguese) in IT Insight
