Data analytics not only benefits large organizations that have large amounts of data, but also smaller businesses that need information that will drive their growth. In fact, small businesses can experience many of the same challenges as when it comes to data analytics, if not more. To understand this, just consider the scale of resources and capital a small business has access to, which is almost always considerably less than that of a large organization or corporation. Aaron Rodriguez, a business optimization expert, explains how data analytics can be leveraged for business growth.
Data analytics, which is achieved through the proper collection, processing and application of information, is not just about having the right tools and software. It is also about having access to experienced people and skilled analysts or scientists. You need automation systems and processing solutions, as well as a structured environment for collecting data from sources.
“Let’s say, for example, you’re doing something very simple like collecting your customers’ email addresses. In the beginning, you have to worry about data entry and accuracy, the reliability of the systems used to acquire and store this information, and the proper organization of the stored data. It’s only once you have the data that the real ‘analysis’ part of the operation begins,” says Rodriguez.
It is estimated that data analytics could increase US labor productivity by 1.5% and increase national income by 30%. To help drive this point home, Rodriguez shares some of the main benefits that can be expected through data analytics.
“First of all, time savings is something that is certainly achievable through this strategy,” Rodriguez says. Small business owners have many responsibilities, and have to balance their time between various tasks and duties. They don’t have access to the same resources as a large company, which means they can’t delegate smaller responsibilities, at least not as much. That’s why it’s crucial that the tools and solutions they implement are effective and don’t waste their time. Data is only as significant as the ability to interpret it. Small companies often outsource the work or hire consultants to handle the tedious work.
It can also reveal new insights. Rodriguez explains, “Insights and actionable intelligence are generated as a result of data analysis, which requires sifting through information to find trends and patterns or to reach different conclusions. The importance of this cannot be overstated, especially for small businesses that have limited resources.” With the right data analytics tools, especially with the help of artificial intelligence (AI) and machine learning, these systems can unlock and identify insights that would otherwise be off-limits.
One of the things that data analytics can provide is answers and in better context. This is very beneficial for problems you may be having or mistakes you are making. Sometimes, you may even discover inconsistencies that you had no idea existed.
Analytics is especially good at highlighting errors in data entry and management, particularly when it comes to data entry. It’s just a matter of looking at the information in various ways and identifying what is happening where and when. For example, a cashier may be having difficulty entering customer data at checkout. Or maybe your system is auto-correcting the information and, in fact, getting it wrong in the end. A thorough analysis can help companies understand what is going wrong, where and at what stage.
Conventionally, a company would take action and collect performance data and customer insights to inform their movements, but this would only allow for action after the fact, immediately before a product launch. For example, a company could see how receptive the audience is, how much it sells, or even if it is a flop. Data analytics makes it possible to use details in real-time, allowing companies to predict performance or results, but also to deal with events at the moment.
“In the end, data analytics, big data solutions, and numerous automated technologies can offer considerable benefits to small businesses and their owners. Perhaps the greatest is the amount of time and resources that are recouped as a result of technology adoption,” Rodriguez concludes. Insights gleaned from various data sets can offer ample opportunities for growth, improvement, and success. It’s all about collecting the right information, finding new and innovative ways to analyze it, extracting information, and turning it into something useful. Data analytics allows a small business to compete at the level of the big guys, and for that alone it’s worth it.