Guide to Transform Data into Actionable Insights
Transforming raw data into actionable insight is about integrating and analyzing data from all sources to find the best and most optimized business decisions. However, the massive amount of data collected by analytics software can be overwhelming. It gets even more daunting when you try to make sense of this big data.
Therefore, to effectively use big data, your team must understand what data means to the organization and what it brings to the company to improve operations and efficiency. In this case, you will find processes like data filtering, grouping, and segmenting helpful. There are ways you can use to turn data into actionable insights, as illustrated in this article.
The difference between data and insights
Data is any form of information you get from your systems. This can include consumer purchase history, location, age, and gender.
On the other hand, insight is the value you obtain after analyzing data. Insights are powerful and can be used to improve business efficiency while identifying opportunity areas.
Data analytics offers insights that help organizations make informed decisions to reduce risks associated with the trial-and-error approach.
Defining Data Analytics
Data analytics is the process of discovering patterns and trends in different datasets. Data cannot make sense without analytics. Analytics helps an organization make sense of data and uncover significant trends and patterns.
Every dataset comes with tremendous value, but you cannot unlock the value without the help of analytics. In this case, data analytics delivers deep understanding, or insights, into the user base. Insights offer essential knowledge about consumers and reveal actions that can be taken to make the business more successful.
Key Attributes of Actionable Data Insights
It is essential to determine what content analytics data insights are to the company.
In that case, it would be good to consider asking the following questions:
How does insight relate to your business? Is the insight based on a key performance indicator that requires a sense of urgency?
Is there a benchmark that gives data context? Do you have enough supporting details that ensure insight does not raise more questions than answers?
Does the insight offer meaningful and relevant information that can be used to make the right decision about the problem at hand?
How specific is the insight? Can it call for acting upon? Or does it specify why something happened?
Does the insight uncover a familiar trend?
Can your team understand the insight and how it can help the business? Can the insight be communicated clearly?
Ways to Turn Your Data into Actionable Insights:
As mentioned before, in order to make sense of your data, you have to analyze and drive meaningful data insights to help your company make informed decisions. Here is how you can transform data into actionable insights:
- Measure the right data sets
It is impossible to optimize what you cannot measure. Additionally, you should not expect a one-size-fits-all solution to any problem. Every problem is unique and should be treated differently from the one before and after it.
For instance, if you are running an eCommerce business, you will want to know the following:
- Which channels give your more conversions?
- What are the places that people leave your website?
- Do people use multiple devices before they can buy your products?
- What is the look-to-buy ratio for every product line?
- What product landing pages should be improved?
You should think about what is good for the business in advance and start making changes that suit your structure and setting.
- Learn to recognize patterns
Recognizing patterns will help you turn data into knowledge. You can identify patterns through a series of lines that connect given price points at a specific time. However, it is essential to realize that not all patterns may be relevant to your situation.
You must review all the potential implications of the discovered patterns and accurately see if it answers the questions raised.
- Ask the right questions
Go all out to answer all stakeholder questions. This step may mean looking into their aspirations and challenges. However, it’s easy to get lost in data for hours and even come up with insights that are not relevant or important to your business needs. You need to ask the right questions to get relevant answers. You must come up with clear questions before going into the subsequent data analysis step.
- Verbally communicate data insights
Another important step is connecting insights from different data sources to get a clear picture of what is happening and expressing it verbally. You can use interactive dashboards to track every KPI and communicate insights.
Communicating uncovered insight to your team brings everyone up to speed on the status of every project. Additionally, it also helps the team to communicate what they know. This input is vital in the steps that follow.
- Drive positive action with segmentation
Segmentation is essential if you want to take action on your data. By categorizing data that have a common attribute such as clientele with similar consumption habits or schedules, you can start digging deeper. You will then choose which category to study, depending on the problem you want to solve or the questions you want to answer.
Identifying every segment and assigning it a unique identity will improve your knowledge of customer behavior and patterns through customer segmentation. This information will help you set up an optimization plan. You can use business intelligence tools, such as ClicData, to build custom reports.
- Use clear visualizations to convey your message
How you present your data can make a significant difference in the outcome. It is like having a presentation that consists of numbers and words and another that includes clear visualizations. Which one do you think makes more sense and is easier to understand?
You have to ensure you articulate every data story with everything behind it. Include the what, how, and why. You should even use charts and other forms of diagrammatic illustrations to get the message home where necessary. This process will transform your data into meaningful insight.
- Discover the context of your data set
Everyone has data and opinions on the information at their disposal. In most cases, if you have a better understanding of the context, you are likely to make the most informed decisions. Ensure you can establish context for every dataset at your disposal.
What do the numbers mean? Are they relevant to the company? How do the numbers affect business?
Data without context is useless and can lead to making a wrong decision because you will misinterpret it.
- Develop a future-proof optimization plan
There are six sigma concepts you can apply directly in your business situation. The best one that will actually improve your business is the “Define – Measure – Analyze -Improve – Control” concept.
For instance, you can define the growth or improvement you wish to have, quantify the growth by measuring it, and then finally analyze the business and formulate an action plan for the same. Consider using this process to enhance business.
- Use a clear hypothesis to formulate a strategy
The beginning of any analysis should be a clearly articulated hypothesis. The hypothesis should be designed in a way that gives it the potential to drive action. For instance, you consider this form when creating your hypothesis:
· I believe…………………… and if I am right, we will…………………….
The first part is the hypothesis, while the second part is the qualification.
Formulating a hypothesis may not be easy, but it will save you time that you would otherwise waste wandering through datasets to draw findings.
- Integrate data sources
By integrating data sources, you will make better and faster business decisions. Businesses thrive when new and relevant information is readily accessible. Therefore, you have to consider data mining, which is the analysis of massive data stores to generate new insights. Data mining and source connecting will make accessing and thus availing information to your clientele easy. This will foster a strong sense of mutual understanding between you and your customers.
- Break down organizational silos
Organizational silos are basically the units or divisions of your business whose operations are independent and don’t share information. It is in the best interest of the organization to minimize and break down these silos. You should envision an organization without blindspots, information should flow freely within departments and sectors for decision-making and strategic planning purposes.
A healthy organization lays the foundation for everything good. Think of communicating instead of confronting. Additionally, inspire, motivate, and be inquisitive about every dataset and its possibilities. This process is more of treating obstacles first and improving communication between the organization and analytics team leaders.
- Hire the right team
Digital tools collect data, but you need people who understand the business to derive insights. You need intelligent people to find meaningful data, and translate the data into data-driven stories (data insights). This should be a team effort that combines internal experts and external analysts.
Start deriving insights from your data
Using big data technology is an essential process to embrace digital transformation. Accordingly, prioritizing customers in any data analysis is vital for the business. However, you need an integrated solution for data analysis, data interpretation, and taking immediate and automated action. This process will help you make informed decisions that improve business efficiency.
Every strategy described in this article can help you fine-tune your action plan for transforming data into actionable insights for the good of your business. You should consider experimenting with a few strategies to find one that works for your business. You would also need a BI tool to help you implement a data-driven culture within your entire company and align everyone on a single source of truth.
About the author
Rithesh Raghavan is the Director at Acodez, a Digital Agency in India, and the co-founder of Acowebs, an online store for eCommerce plugins. Having a rich experience of 15+ years in Digital Marketing, Rithesh loves to write up his thoughts on the latest trends and developments in the world of IT and software development.