What is Data Transformation? Insights into Metrics & KPI Tools

June 27, 2024  

Data transformation is like a magic wand for your business data. It takes messy, hard-to-understand information and turns it into something you can actually use. Imagine having clear, easy-to-read stats and facts at your fingertips. That's what good data transformation tools do.

But we're not just talking about cleaning up numbers. With the right software, you can also set up key performance indicators (KPIs), get alerts, and even have experts help you make sense of it all. This unlocks the value of your data to give you visibility into your customers and operations and to help you make decisions.

Definition and benefits of data transformation

What is data transformation?

Data transformation means changing it from its raw state to a usable state.

When data first arrives into a data warehouse, it is considered “raw” meaning it looks exactly like it did when it came from the upstream operational system. However, “raw” data is not always useful, insights come from the transformation. Read our example below to understand data transformation in context.

Example of Data Transformation

If you are interested in a metric like Customer Acquisition Cost, you need data for the cost of acquiring customers (the numerator), which comes from your accounting system. You also need data on the number of new customers acquired (the denominator), which comes from your CRM.

Raw data from your accounting system and your CRM must be combined to calculate the Customer Acquisition Cost metric. This process of combining data, reshaping it, and calculating metrics is data transformation.

Benefits of Data Transformation

Data transformation isn't just a “nice to have”; it's essential for any modern business that wants to succeed.

Actionable Insights

By converting raw data into a format that's easier to understand, you unlock actionable insights that can drive decision-making. This means you can spot trends, make improvements, and get ahead of the competition.

Save Time & Reduce Errors

The benefits go beyond just cleaning up your data. By automating your data transformations, you save time and reduce errors. This also enables data monitoring and alerts, so you're always in the loop. Data transformation is the key to turning your data from a chore into a valuable asset.

What does data transformation enable data analysts to accomplish?

Data analysts are looking for answers. They use data and analyze it to try and identify insights or help a business make decisions.

By transforming data from its raw state into a more usable state, data analysts are able to answer more questions than leaving data in its raw form.

Understanding data transformation services

What are data transformation services?

In today’s world of hyper-specialization, it rarely makes sense for small and medium-sized companies to have top-tier data analytics expertise on staff full-time. Freelancers and firms exist that can provide on-demand data transformation services.

The delivery of these services can vary, as can the quality. 

Common Data Transformation Services

Automated Data Cleaning & Enrichments

Automated data cleaning eliminates manual processes that are both time-consuming and error-prone. With automated enrichments, your raw data is instantly transformed into a usable format, ready for analysis or reporting.

Real-Time Analytics

This means your data will always be up to date and of high quality so that you can trust the numbers in your reports and dashboards.

Data Monitoring & Alerts

With advanced data monitoring and alerts, you're never in the dark about your data's status. If something is not right, not only will you know about it, but so will your service provider. Your service provider would then take immediate action to resolve any issues, ensuring continuous data integrity and business operations.

These real-time alerts go beyond just notifying you of errors or inconsistencies; they're part of an active system that constantly monitors the health of your data on our metrics platform. This saves you the effort of constant checks and the worry of undiscovered issues lurking in your data sets. With data transformation tools, monitoring is proactive, not reactive, making your data a reliable asset rather than a potential liability.

Data Model Assistance & Consulting

This service includes constructing and maintaining your data models, so you don't have to invest time or resources in becoming an expert. Your service provider will create KPIs, develop transformation metrics, and ensure that everything is aligned with your business objectives on your KPI platform.

Using this service means you can focus on using the insights and benefits these models provide, rather than worrying about how they are built or maintained. The service provider would do the complex work behind the scenes, transforming your data into a strategic asset that drives smarter decisions and better results.

What To Look For In A Data Transformation Service Provider

When considering a provider of data transformation services, you should evaluate the following:

Definition and benefits of KPI and metric tools

Understanding KPI and Metric Tools

What is KPI tracking?

Key performance indicators–KPIs–are metrics that a business determines are most important. Of all the things that could be tracked, some are more important than others–these are KPIs.

KPI tracking means keeping track of these important metrics over time to be able to assess business performance and outcomes.

What is KPI software?

KPI software is a product that tracks metrics and delivers them on demand. Often, this software replaces spreadsheets or other manual tracking efforts.

Benefits of Using KPI & Metrics Tools

With the right KPI software and metrics software in place, tracking key performance indicators (KPIs) becomes a breeze. Gone are the days of sifting through spreadsheets or waiting for quarterly reports.

With self-service, on-demand access to your metrics, anyone in the organization from the executive suite to the shop floor can make data-driven decisions using our metrics tools.

KPI & Metrics Tools are for the whole company

Modern dashboards and reports are user-friendly, making KPI tracking software accessible to all. Whether you're in marketing looking to measure campaign success or in operations keen to improve efficiency, these KPI tools are not just for analysts or data scientists. They empower everyone to engage with organizational goals and progress on a KPI platform.

What technology is involved in KPIs, metrics, and data transformation?

Numerous technologies are involved. The core components are:

  • Data warehouse
  • Orchestration/scheduling
  • Support desk or ticketing system to handle errors and failures
  • Data extraction software
  • Data visualization (i.e. embedded analytics)

The central component is the data warehouse. Learn more in our What Is a Data Warehouse? article.

How to lead a data-driven digital transformation?

Many people and businesses understand the power of using data to get visibility and understand their operations and customers. However, this can be a large, complicated effort to fully realize the value that data potentially holds. 

When leading a data-driven digital transformation, we recommend following our Simpler Analytics framework. 

Simpler analytics framework

Start with the Audiences who need to use data to make decisions or answer Questions. Follow down to identify the Questions they need answered. 

With that information, you can begin to identify the Data Sources that contain data that could answer the Questions. And you can define the Metrics and Data Products that will deliver those answers to the Audiences.

Throughout all of this, delivering narrowly defined iterations is more successful than trying to do too much at once. 

In Summary

Data transformation is essential for modern businesses, turning raw, unstructured data into actionable insights that drive decision-making and strategic planning. 

By utilizing advanced tools for data cleaning, enrichment, and real-time analytics, companies can maintain high-quality, up-to-date information that is crucial for monitoring performance and achieving competitive advantages. 

Furthermore, data transformation services, including model assistance and consulting, empower businesses to focus on leveraging insights rather than managing data, ensuring that data becomes a strategic asset rather than a liability. 

As businesses continue to navigate a data-driven world, the importance of effective data transformation and the ability to track key performance indicators (KPIs) cannot be overstated, making it a critical component of organizational success.

Contact Datateer

Adam Roderick

Follow me here

About the Author

Adam's tech career spans startups to global firms, touching finance, tourism, e-commerce, and consulting. Spotting a way to give small- and medium-sized companies an advantage with data, he founded Datateer to democratize analytics. He values relentless progress, simplifying complexity, and putting people first.

You may also like

Subscribe to our newsletter now!