A lot of entrepreneurs are ensnared by data, rather than enlightened by it. That prevents them from making the data useful.
Raw data is completely useless until it can be transformed into information that is used to make active decisions. The problem is that most companies ignore the importance of business intelligence.
Global management firm A.T. Kearney projects that companies will spend $114 billion in 2018 on technology to get a handle on big data. That proves just how powerful data is and also shows just how much raw data is available.
It’s essential that you develop a process to transform that raw data into actionable insight. In this post, I’ll walk you through several steps that will show you how to transform data into insights with business intelligence.
1. Set clear goals
What is your overall campaign trying to achieve? Once you know exactly what you’re trying to accomplish, you can start defining the data. What are you going to do with the data?
In most cases, your goal-setting will follow a specific pattern: context, need, vision, and outcome.
Each step of the path has several questions that must be answered.
Visualization tip: Before moving on, envision your initial data conversion using the answers above. Then use a pen and paper to sketch the concepts of your desired outcome. Create a vision board that you can post to look at every day. Eighty-two percent of small business owners who create a vision board succeed in achieving more than half of their goals.
2. Build the framework
When building a house, a carpenter has to build the frame before they can start putting up a roof and walls. The same is true here. You have a blueprint, so now it’s time to start developing the framework.
Remember, you are still in the brainstorming phase so nothing you find here will be set in stone.
Follow these simple brainstorming techniques to come up with ideas about how you are going to approach your business intelligence data conversion plan:
- Focus on the topic that is most related to your strategy and ignore the rest of the data. Don’t let it distract you from achieving your overall vision. Go ahead and cut out that data right now.
- If you’ve cut out anything that is irrelevant, you should be left with useful data. Rank that useful data in order of importance.
- Create different categories, and summarize that data into these categories. This will help keep everything organized.
These lists will be the framework for everything you do moving forward. Now it’s time to actually start developing a system to transform that data into actionable insights.
3. Give raw data some context
In business, context is key to successful business intelligence. Here’s a quick example.
Let’s assume that we have a subscription-based product that has 35 million registered users. That’s a huge number by itself but does it really give us any insight? No. All it tells us is that we have 35 million subscribers right at this moment.
However, if we were to combine that with data from previous years, then we would gain insight. Here’s an example of how we can give that data context.
2014: 1 million subscribers
2015: 10 million subscribers
2016: 20 million subscribers
2017: 35 million subscribers
Now we have enough data to provide context. Here are some useful insights that we gain from that data.
- We gained 15 million subscribers this year
- We gained 25 million subscribers over the past two years
We can be more specific than this by segmenting the data into different types of users. Of the 15 million subscribers that signed up in 2017:
- How many leads came from mobile devices?
- How many leads came from social media?
- How many leads were between 18 to 25 years old?
- How many leads were female?
The point is, context is how you begin the process of transforming raw data into actionable insight. A standalone figure is meaningless without context because we have no way of illustrating how it’s changing in accordance with the market.
Note: Useful data is not limited to your own business. In fact, the most useful data usually comes from your competitors.
4. Map your target market
By this point, you should have enough useful data to map out the standard day in the life of your target market. This is going to rely heavily on finding context. You must know the types of consumers that are purchasing products and services similar to yours.
- How does your target market find products/services related to your business?
- Why do they need your products/services?
- When will they need your products/services?
These details might seem mundane but they will provide insight to specific challenges that your target market might be facing. True value is in the details!
5. Bring data to life
The final step of your business intelligence plan is to bring data to life by transforming it into actionable insights. The following tips will show you how to accomplish that goal.
- Data points are less important than trends. Focus on trends to gain insight.
- Examine time ranges, like in the example above.
- Search data for relationships. Strong relationships usually provide the greatest insights.
- Always be skeptical. Data can be misleading with taken out of context.
Are you interested in other business intelligence insights?
If you want to know more about how business intelligence software can help you get information out of your data, check out one of these great Capterra posts: