The world has been transformed by technology to such an extent that it’s hardly recognizable when compared to the one that existed a century, twenty years, or even a decade ago. And no aspect of existence has been rocked quite as much as the business world. Much of this change in the halls of business comes from the way decisions are made.
In the past, businesses relied on the savvy and guts of the men who ran them, men who made decisions often based on nothing more than a gut feeling. That old model has fallen by the wayside, however, largely because of the data revolution that has replaced it. So-called Big Data can be amassed and organized in such a way as to take a lot of the guesswork out of the decision-making process. Many CEO’s of modern businesses would never even consider doing anything based on instinct alone, without being backed up by reliable data.
Whether you’re trying to find out the exact time to make an investment or see if your website can properly handle your SEO load, there are analytics in place to make that happen. But you have to be careful of certain times when your reliance on the data can actually steer your wrong.
Tipping the Data Scales
The reason so many people use Big Data analytics as a method to make decisions is that it takes emotion out of the equation. Or at least it’s meant to do that. What many CEO’s do is to form their opinion first, and then find the relevant information that backs them up. In actuality, the process should be reversed. You should be taking in every last piece of data, even information that seems counter intuitive or contrary to your beliefs. Once all of that is analyzed, you can then make the most informed decision possible.
Moving Too Quick
One of the areas where data does a great job is in delineating and forecasting trends. Ideally, you can use this knowledge to determine the right timing for a business initiative. But many business owners or CEO’s are in such a hurry to make a decision that they don’t allow enough time for a trend to develop or for one to prove that it’s a predictable trend going forward and not just a fluke. Statisticians talk about the danger in believing in a small sample size, so make sure that your data is sturdy and time-tested enough to withstand scrutiny.
Getting the Right Analysis
All too often, data analysis is seen as being solely a concern for the IT department at a company. But what if the data gathered actually affects, for example, the accounting department? Shouldn’t it be within their purview to examine this data as it relates to their particular slice of the business pie? Knowledge-sharing across different departments is a crucial component to any successful business, and the knowledge gleaned from data analysis is no different.
While business owners should certainly undertake the garnering and analyzing of Big Data, they should always keep these common missteps in mind. If you as a business owner can avoid them, the data shouldn’t lead you astray.