As a business owner, you would already know how frustrating it can be not to have the correct information. From designing your logo to marketing your services and products, every step along a business plan requires backing from relevant data. You need to know the current market conditions, your target audience, the finance details, and so on to make the right business decisions.
For your pricing plans, sales strategies, discount offers, and campaigns to work, they need to be based on real data to ensure they will work before you invest your valuable time, resources, and money. Businesses cannot be taken lightly, and playing guessing games will only do more harm than good.
But this simple fact is often lost because there is so much data but not enough insights. And often, the available insights only pertain to financial systems and bookkeeping and hence cannot be applied to the overall business strategizing and planning.
Businesses need effective ways to gather data and get meaningful insights from the huge amount of data collected. Data analysis and proper visualizations can help executives get a good idea of where their business stands and what needs to be done to grow it in the direction they want. Data insights guide your business towards optimizations in every aspect of your business operations.
For instance, identifying the root cause behind productivity lags can help improve productivity and save time and money. Data insights are essential to making calculated, strategic decisions that keep pushing your business towards its goals.
How does data science for business work?
When you hear the terms data science, AI, and machine learning, people often get transported into the realm of science fiction. But the truth is, we already live in an age where the application of data science is pervasive in all walks of life, more so in running a business.
About 1.7 megabytes of data is generated per person every second. Data science helps you make sense of such huge amounts of data and is rightly considered a valuable addition to businesses and corporations worldwide.
A McKinsey report estimates that big data initiatives account for around $300 to $450 billion reductions in healthcare spending in the US. The US Bureau of Labor Statistics says that data scientists are one growing employment category that will witness a 15 percent rise by 2029.
Data science allows you to understand the huge data your business generates and helps you gain valuable knowledge from it. Say, for example, you want to know the recent customer buying trends and promote that product well or invest more in that product so you can get better returns. Data science can be used to understand customer behavior, demographic characteristics, preferences, buying capacities, and more. This information and insights can identify customer buying patterns and what attracts them.
Data has become the most valuable commodity in the digital age. But data is not just a number in spreadsheets. It is the hidden data, the patterns that make sense, and the insights you derive from your data that tell you how your business functions. It guides you into understanding how the relationships between your staff, customers, and suppliers work and, ultimately, where you are making or losing money.
Here are some common areas businesses can apply data science to their benefit:
- Get insights into customer behavior
- Improve your security policies and systems
- Optimize your internal finances and risk management
- Optimize manufacturing processes
- Make market predictions
Challenges in adopting data science for your business
Every change you bring in your business will face some resistance. There could be a lot going on in a business establishment that we see is not all we know. Businesses have several components with low visibility but a bigger impact on the revenue. Focusing on all aspects while adopting data science could help you avoid mistakes and minimize risks.
Here are some areas of concern that you can get amazing benefits with the right data science approach. These areas may not be easily adaptable, but you can gain the best results you seek with the right IT systems and processes.
Staff efficiency is often estimated as a measure of their productivity levels. But how do you measure productivity? It is not just the time spent in the office. Nor is it the total available hours for the employee. It needs to be a proper estimate considering their available hours, utilization levels, overall task efficiency, and more. Understanding the various aspects of employee performance can be tricky, but with the help of data science, you can achieve it effectively.
Customer account performance
Analyzing customer account performance allows you to identify the most valuable customers to your business. It also helps you categorize customer profiles, understand your target demographics, and effectively rub targeted promotions and ad campaigns. By understanding customer behavior, you can also improve your customer relationship, loyalty, and profits.
To do so, you need to consider everything related to each customer: time, costs associated with acquisition, maintenance, feedback, interactions, customer preferences, location, and so on.
You also need to calculate your profit margins on a client-by-client basis. Identify where your staff spends time and what resources your clients drain, which clients make you more money, and which ones are a cost burden.
How data science adds value to your business
As already outlined, having systems gather and present this data to you in a meaningful way will allow you to make insightful decisions to help grow and evolve your business; without all the risk and mistakes that come with guesswork.
Here are some benefits of adding the power of data science to your business operations:
Better decision making
Your managers and key decision-makers can make more confident decisions based on real data rather than gut feeling. Data science also ensures you are well-prepared for any risks and helps speed up decision-making. Approvals can be made easier when you have supporting data insights and visualizations that aid decision-makers in understanding their business problems easily.
Data models can also be used to test your decisions by keeping track of key metrics and thus help you quantify your progress.
Forming smart goals is a big part of taking your business to the next level. But if you cannot concisely define your goals, it cannot be considered a smart goal. And data science can help you with that. With data insights, you can define precise and definite goals and also be able to track your progress more accurately.
Often, businesses may miss out on emerging trends or untapped potential. Data insights help you identify unexplored opportunities and help you develop your business better.
Best data science solution for your business
Your business’s best data science tool could depend on your particular needs. If you are just starting with data science, you should check out PowerBI from the Microsoft 365 suite of enterprise tools. PowerBI can be used for free at the basic level and could help you get accustomed to gathering and visualizing your business data. It also comes with features such as business process automation, thanks to integration with Microsoft Flow in 365. You can get access to several other features with the help of PowerBI integrations from a wide range of third-party systems.
PowerBI is also simple, with an intuitive user interface and beautiful data visualizations and reports to rely on. It presents information in clear, concise, and easy-to-understand visualizations and reports.
Understanding and adopting data science into your business can get overwhelming, given the technicalities and huge data involved. But with the necessary guidance and expert help, you can easily get around this part and jump to reaping the benefits of what data science brings to your business.
We can help you break down your data silos across the business and gather valuable insights from all you do. Contact us today to learn more.