Data can be the driving force behind your success, if you know how to harness it. Data analytics illuminate trends, point the way forward, and identify new opportunities for your business.
The world’s biggest companies know this and are using data analytics to drive innovation. For example, Netflix transforms data about customer viewing habits into binge-worthy new shows, and Coca-Cola is combining data with machine learning to predict popular new flavors.
The potential of data analytics is massive, which is why we have incorporated business intelligence (Microsoft BI) into our Managely software. With these analytics, you can get data about what’s happening in your business right now as well as actionable insights into the future.
Understanding the 4 Types of Data Analytics
But first, you need to understand the four types of data analytics:
- Descriptive analytics help you tell the story of what happened. This is the building blocks of all other analytics. For example, using descriptive analytics, you could pinpoint which of your products are most popular or the season that sales are highest.
- Diagnostic analytics answer why something happened. They illuminate trends and uncover relationships between two seemingly different variables. Using diagnostic analytics, you might combine sales data with demographic data to discover who is buying your most popular product and why.
- Predictive analytics help you understand what might happen next. For example, they might help you understand this year’s high sales of product X in relation to the past several years’ of sales, so you can anticipate future spikes in demand.
- Prescriptive analytics bring together all of the above so you can understand the best way to move forward. It highlights strategic opportunities for action. For example, you might anticipate a seasonal spike in sales for product X and try to maximize this with targeted marketing to would-be customers.
When you understand these four types of data analytics, you can move from asking yourself, “what just happened” to “what should I do next.” This is the critical leap from information to innovation.
Using Data Analytics to Drive Innovation
Our SVP of Product Management, Julie Lichty, recently presented at Converge 2022, where she discussed how businesses can move from data to insights to innovation. As she points out, “It’s important to separate between improving feature X based on the data and innovating by creating something completely new that we can see is missing thanks to the data.”
Data-driven innovation can help you identify new revenue streams, strengthen customer relationships, and uncover valuable competitive advantages. It’s about bringing a new system or product into being – one that hasn’t yet been invented but solves real problems that the data has exposed.
Getting the Most Out of Your Data
Before you can innovate, however, you need the right groundwork. That means collecting your data in one place, freeing it from departmental silos, and actually using it.
- Break free of data silos. Data can be found everywhere, but you can’t use it if it’s behind another departmental wall. Bring data from many places together to get a unified view of your business and surface unexpected insights.
- Create a robust data repository for all potentially useful data. Accelerate change and innovation by building a robust data repository. Ensure your staff can get the data they need, in a single place, so they can use it to propose bold new ideas.
- Use the data you have. Surprisingly, 58% of businesses say that they act on gut feeling or experience at least half of the time that they have to make a decision. However, the best performers lean on data 60% of the time when making decisions, while those who lag behind follow their gut 70% of the time!
Superpower Your Business Analytics with Managely
If you’re ready to see what’s possible with better data analytics, we invite you to try out Managely, our business management solution specifically designed for security and alarm companies. Get started today!