Transitioning from raw data to insight and action is the stuff that business dreams are made of, yet many of us struggle with it. We look at how actionable insights are the missing link for SME businesses, and how creating a feedback loop between data and insights is key to driving growth.
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First, let’s review some basic definitions.
Data is the raw and unprocessed facts about something, and can be quantitative (e.g., you made 10 sales over the course of a month), or qualitative (e.g., 10 customers rated your service as “excellent”). Data usually lives in spreadsheets and databases.
Insights are the inferences and conclusions you draw by analyzing data either directly from the source (e.g., a spreadsheet) or from a more user-friendly format (e.g., a pie chart or graph). For example, if a data set shows that your average delivery times have increased by a day over the quarter, you might deduce that your shipping provider isn’t up to standard.
Actionable insights are perceptions that drive you to rethink your approach or take an action. For example, your increased delivery times might drive you to look for a better shipping provider. Actionable insights are what elicit real change and growth for a business over time.
While most of us intuitively understand the difference between the three definitions above, the reality is that many businesses don’t know how to effectively implement a workflow that takes all of them into account. Forrester reports that 74% of companies say they want to have a “data-driven” framework but only 29% are actually successful at data-driven decision-making.
Essentially, the majority of businesses have a mountain of data that’s useless. That’s why creating a workflow for gleaning insights from data is critical – a half-baked data strategy is equivalent to sitting on a pile of buried treasure.
So, what’s the difference between a business with data and a truly data-driven business? Most business intelligence efforts are one-way: lots of data leads to (maybe) insights, which leads to (probably no) action. The most successful businesses use technology to link data and action, allowing teams to continuously discover, test, and make decisions based on the information available to them. Those decisions fuel more data, which creates a continual feedback loop that’s crucial for growth.
We know that turning data into insight is the secret ingredient for fast-growing businesses – but how do they do it? It’s all about utilizing technology and software to do the hard work for you.
Performance cycling brand SUPACAZ, for example, uses TradeGecko’s Intelligence Reports to take a deep dive into top-selling variants and track their Cost of Goods Sold (COGS). This enables the business to make smarter decisions about product expansion and ensure the costs of doing business aren’t eating into profits.
I can use the Intelligence Reports to see exactly how much it costs us to fulfill an order through our website. It’s so much easier to track important data with the click of a button."
The social impact shoe brand Anothersole uses TradeGecko’s Intelligence Reports to accurately allocate inventory across multiple locations based on inventory and sales insights – helping them keep delivery times and warehousing costs low.
TradeGecko allows us to call up reports and look at where the stocks are so we can make a decision on a weekly basis on what to optimize or move move to different locations. That definitely has a direct impact on converting our sales and opportunities."
Every business’ needs are unique – the key is to use the right tools to gather insights and create a framework for growth.
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