Data: Go Big or Go Home
Today, like never before, firms are able to collect an array of insightful data on prospects and clients. With every financial transaction, website click, social media post, email exchange, and download, information is exchanged and gathered. A term first used by NASA scientists in 1997, big data was described as the issue of vast amounts of data sets stretching the limitations of computing power. In 1999, Berkeley researchers estimated that 1.5 billion gigabytes of information had been produced that year. A more recent study by IBM estimates that 40 zettabytes of data will be created by 2020 – that's 43 TRILLION gigabytes of information. To put that in perspective, every day, Google processes 3.5 billion searches; 300 hours of new video is uploaded to YouTube every minute; 100 billion emails are sent and received per day; 51,000 apps are downloaded by Apple users every minute – and that’s just a small portion of data that is exchanged each and every day.
Simply put, big data is viewed as any collection of data sets that is too large to process, manipulate or analyze by hand or with traditional applications (e.g., a simple Excel spreadsheet).
Big data is not just for the Amazons, Deloittes, and Apples of the world. These organizations have teams of analysts examining millions of data points on their clients, but your firm can learn a few lessons from these Big Data miners and make strategic decisions based on your own large data sets. Even small firms have a wealth of information on clients and prospects. Here are six tips to start using the data you have to your competitive advantage.
Know the Question
Before you look at the data, make a list of the questions that lead to better business decisions. What drives your clients’ purchasing decisions? What drives their loyalty? What attracts prospects to your firm?
Identify the Data Points
Once you understand what is truly important to success, then look at the information you have: financial, logistical, behavioral, and digital. What do you know about your clients and prospects? For example, look at revenues, costs, profit margins, geographic locations, cost of acquisition, ROI, and effective rates. Gather data on client relationships: depth of the relationship, longevity, client satisfaction, and more. For prospects, you most likely have names, titles, contact information, as well as digital data like open rates, click-throughs, website visitors, resource downloads, and other engagement measurements.
Prioritize the Data
When compiling data sources, think about what is most important to your firm. What do you need to know? What do you want to know? What data sets have the biggest impact on your firm’s ability to attract and serve its clients? Identify KPIs that tie back to your firm’s goals and service delivery. With limited resources to analyze the data, prioritizing the data is imperative.
Next, identify the data that is missing. What do you not know or have that would give you the insight needed to make good business decisions? Can you gather that information on your own, or do you need to turn to industry experts? Review studies, surveys, and reports to collect information on industry trends and market behavior, as well as historical data. From Forrester and Gartner to the AICPA, AIA, ASCE and other industry groups, there is an abundance of industry information that can be accessed or compiled with little effort.
The trick to getting the most out of any data is having a well-established process for evaluating the data. Evaluate, visualize, interpret, and analyze the information from various perspectives, but stick to the ones that answer the fundamental business questions. Establish a process to continuously track and monitor the data. It’s imperative that leadership reviews the data on pre-determined schedules be it monthly, quarterly, or annually – depending upon the relative importance and impact.
Understand the Trends
It’s not enough to gather and crunch the numbers into chart after chart. The value of data comes from the trends or insights it produces. What does it mean when you look at the data as a whole? What are the trends or behavioral patterns? What do the insights mean for revenues, pricing, profit margins, distribution channels, marketing or sales channels, services, delivery mechanisms, etc?
Data – whether big or not – is not a buzzword nor is it a passing trend. Big data has and will continue to change the way we do business and interact with our prospects and clients. Data is the key to staying competitive. Today’s technology makes it easier than ever to identify trends before they negatively impact your organization. When used correctly, data can have positive outcomes throughout your organization. In today’s world, change is the only constant. If you aren’t aware of the changes when they are happening, know that your competitors are.
Unlock the power of data – go big or go home.
Posted on Fri, April 1, 2016
by Christine Hollinden