We mostly only hear about data in relation to business. That makes sense; your average person doesn’t go around talking about how they used data to decide what color shirt to wear on their big date or which coffee shop to go to. And yet, without realizing it, they did use data for those decisions!
We even sometimes get to see how our favorite characters make decisions when they work with what data they have or don’t have. It’s The Great Pumpkin, Charlie Brown! is the perfect example of how a lack of valuable data and information led one character to proceed without actionable insight. With proper analytics, Linus might have better understood what to expect on Halloween night.
Instead, he ended up cold and alone. Don’t let your data leave you cold and alone, too. When you learn how to extract actionable insights from your business data, you’ll wonder how you ever survived without them.
What are Actionable Insights?
You know that little brain lightbulb that goes off sometimes when you are reviewing information, and you suddenly know what to do? That’s actionable insight!
In data terms, actionable insight is the understanding you receive when you collect data, turn that data into information, and the information points you to possible (or necessary) business actions. From these insights, a company can make confident data-driven decisions. Actionable insights are more than just interesting information; they propel business forward.
Data is the required starting point for actionable insights. First, however, it needs to be processed and analyzed. In its raw form, it doesn’t actually provide any comprehension. It lacks information.
Once you’ve analyzed your data and gleaned some information, it needs to be put into a clear and understandable format through data modeling. Perhaps our friend Linus had gotten plenty of information about the Great Pumpkin before his pumpkin patch fiasco, but it hadn’t been presented clearly enough to him. Linus wasn’t lacking data about the Great Pumpkin at all; he was the most knowledgeable kid out there! He simply didn’t analyze his data to get the correct actionable insights.
Linus isn’t the only data-challenged person. One survey showed that 24% of people were not successful in pulling actionable insights from their data, either. Fortunately, you know better for your business. You can take proper action when you realize that your data process doesn’t just end with the information.
The Importance of Actionable Insight
Getting insight from your data means that you are well-placed to make the best decisions for your business. Your data applies specifically to your company only, meaning it’s like a personalized action plan supported by facts. What a gift!
Businesses today are becoming increasingly data-driven. That leads them to fully informed decisions, not just a shot in the dark. (Or a night alone in a pumpkin patch, if you will.) Unfortunately, non-data-driven companies are getting left behind.
This could be supremely detrimental to any company not fully using their data for actionable business insights! However, MicroStrategy determined that 60% of businesses around the world use actionable insights to increase their efficiency and decrease their costs.
And actionable insights certainly pay off for them. Businesses taking full advantage of their data can respond faster to situations as they crop up. They know how to access the data they need and analyze it to figure out the best path forward. It also leads to more efficient operations, moving employees along, showing companies everywhere how to improve their output.
How to Get Actionable Insight
If you’re starting to sweat a little thinking about how all these other companies are getting incredible insight from their data and happily buzzing along, you can relax. Not everybody is adept at extracting value from their data; 75% of business leaders don’t know how to go about it.
You need a strong data game if it’s going to be successful in cultivating actionable business insights. Make sure your data meets the requirements on this checklist:
- Does your data have data quality? Don’t waste time trying to pull insight from data that’s no good. Be sure it’s valid, reliable, and complete.
- How’s your infrastructure? You need dependable data extraction methods and thorough analytics. And don’t forget storage; make sure your data warehouse or lake is scalable so that you can expand when needed.
- Practice data integration. Don’t silo your data! You’ll benefit when you ensure your data is connected and accessible. If you make your information readily available so it can be connected with other data areas, you’ll have a more cohesive and complete data picture.
Converting Data into Actionable Insight
It’s nice to have data, but you need to be able to do something useful with it, or else it’s pointless. What good is a delicious-looking cake if you can’t eat it, too?
Before you even begin extracting data, it’s critical to outline your goal for the data or lay out a problem you hope to solve with it. Otherwise, you’ll be pulling data willy-nilly and may not be getting the right type. 55% of businesses don’t do anything useful with the data they pull. Unrelated data that has no context only obscures valuable data.
Once you have outlined why you need your data and gathered the relevant information, put your results in context. The numbers need to be explained by analyzing them. What does the data reflect, and why does it indicate what it does? Also, what time frame does it depict, and is it still relevant?
Finally, use visualization to convey the data results. It will make your data understandable, so even Charlie Brown can understand. But that’s not fair to Charlie Brown; he wasn’t the one who waited up all night in a pumpkin patch for a mythical figure. Make sure your data gives you actionable business insights.