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Best practices for data-driven decision making

August 30, 2017

Wondering how to set up processes to make the most of your data? We look at how the human/AI synthesis within a predictive analytics framework produces the optimal basis for data-driven decision making.  Tweet This

It doesn’t matter if your company is at enterprise level or a small mom-and-pop shop, data should inform every business decision you make. You need data to understand how pricing affects your sales quotas and when to schedules sales based on external forces such as weather predictions. It’s the data that gives you insights into your business, which is what powers the decisions you make.

Setting up your data-driven model

Like any other process or strategy, best practices in the field of predictive analytics inform how to set up your data-driven decision making model. Here are the foundational best practices you should use to develop data-driven processes.

  1. Set your strategy. This might seem counterintuitive, but you don’t start with data. You start with your business strategy. What is it you want to achieve?
  2. Find your questions. You have questions about how you’re going to achieve your strategies, what should you focus on first, and what do you need to know to make the best business decisions. This will provide the foundation for devising your data requirements.
  3. Use data to match strengths with business needs. Focus on identifying the ideal data that helps you match your business’s strengths to its needs. Ideal data would be elements that help you answer big strategy questions and give you insight into achieving your objectives.
  4. Identify data you have vs. data you need. You’ll need to know what data is available internally before you decide what you need to find externally. For example, you have plenty of sales data to use in forecasting, but you could use weather-related data to help you pinpoint when to run seasonal sales.
  5. Invest in the proper technology. A data-driven management platform can help you manage disparate data and cultivate it down into easily-accessible bits of information to inform decisions. Find a platform that doesn’t require expert knowledge in SQL programming, but is instead built for business use at management and frontline levels.
  6. Analyze the data. Once you have your systems in place and access to the data you need, you can begin analysis. Don’t trust data without context. Make sure your reports are based on an intimate understanding of what the data is and how it’s being used.
  7. Share the data. Unless you get the right data to the right people at the right time, you won’t have effective data driven decision-making. You need to make sure that the managers and frontline staff have access to the insights in the data to inform their decisions about pricing, sales, inventory, and other key metrics.
  8. Don’t forget human intuition. Big data can only go so far in helping businesses derive benefits. When you add in the human intuition your staff and managers have regarding customers and products, you’ll have better results. Harvard Business School and other leading educational institutions researched and reported that the combination of data and human intuition is proven to produce more accurate forecasts.

The human/AI synthesis wins every time

The most rewarding part of these data driven decision-making best practices is turning the insights you glean into action. Data + human intuition helps you understand your business from a fundamental level not available anywhere else.

Evo Pricing proves Data + Human Intuition = Success

Evo Pricing can help you create dynamic pricing strategies based on customer and competition analysis, costs, macro-economy, and even weather data. We also help you manage your marketing ROI by solving your challenges around promotions, churn, and markdowns.

You can better estimate expected future demand, and determine your product range and its distribution with Evo Pricing’s comprehensive data-driven management platform.

If you truly believe in data-driven management, then our innovative solutions will deliver tremendous results: proven by $200m+ margin already created.

Contact us today to discuss how we can help you create a culture of data driven decision-making that transforms your business.

About the author

Kathy Edens is a digital content creator who enjoys writing about cutting edge technology and how it can disrupt and innovate the way a business operates.

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