Data, data, data. No matter which industry you are in, you have likely come across discussions about data recently. We intuitively know that data is important for business management. But why must SMEs invest in it right now when developing new products to target new customers and retaining existing ones are the priorities?
Data is the treasure trove buried in your backyard that you may not be optimising. For years, successful multinationals have been harnessing the power of historical transactional data to make business decisions. But data itself is not useful without proper data analytics, the alchemy that turns data into valuable and insightful gold.
Bounty within your reach
Financial institutions are good examples of large-scale data interpretation and knowledge creation. In fact, algorithmic robo-trading is a recently-developed sector of equities, foreign exchange and derivatives trading based on the interpretation of extremely deep sets of historical data. But that does not mean data analytics is out of the reach of SMEs however. In fact, some of the fastest rising startups have built their entire businesses around their unique datasets. AirBnB uses data to connect travelers with home owners, providing alternative accommodation options to the former, and another income stream for the latter. Singapore-based GrabTaxi harnesses and interprets the information from its users and drivers to create optimal products and services, from scooter taxi routes to food delivery, for the benefit its consumers. These two cases not only show the power of data, but it also demonstrates the potential of data when used wisely - Airbnb has disrupted the hotel industry to the point where top hotel chains regard Airbnb listings as direct competition; while Grab has not only enhanced the taxi industry, but even managed to edge out Uber from Singapore.
This is all the more reason why you should not dismiss data analytics as something out of your grasp. Rather, consider riding the wave of data analytics developments to stay in the game. With proper analytics, business data can help to create insights about all aspects of your business, from sales to finance to HR and talent acquisition, enabling you to improve inefficiencies.
Without analytics, huge potential is simply untapped.
The data beneath your feet
The most relatable type of data for most SMEs is transactional data. This type of data is anything that involves an exchange of information, including sales and receipts, purchases and payments, and stock and inventory. Transactional data is incredibly important for businesses because it can tell the story of variability in your business cycles. By examining large amounts of data, it is possible to discover patterns and correlations that may not be obvious initially, thereby helping to optimise your operations.
As an example, a UK-based cosmetics manufacturer wanted to see where they could optimise their warehouse operations in order to free up working capital. By analysing the transactional data of both sales and inventory, the company discovered inefficiencies when stock was being held up. This allowed management to refine their purchase decisions, saving close to £10 million in inventory, as well as freeing up 10% of the warehousing space.
Investing in a true asset
Perhaps the most exciting thing about data analytics and data science is that we are entering into a golden age, where technology has already started to open up opportunities to predict future trends and patterns with remarkable accuracy. In a cutthroat world where businesses move at breakneck speed, SMEs that are serious about staying ahead of the game must invest in accurate and reliable analytics to make decisions fast. Businesses no longer have the luxury of sitting out with a wait-and-see approach because data is a true ‘asset’. As you invest in, and build your datasets, data science will help to increase its future value to the business.
Those who do not invest in it, will be left behind.
DATAVLT is giving away complementary Feasibility Reports (worth USD$2,550) so that growth-oriented organisations can position themselves for the future. The report will assess your collection methods and advise on further optimisation, allowing you to obtain preliminary insights to your data and gain application ideas for advance analytics to grow your organisation. Get in contact with us for your free assessment: https://www.datavlt.com/programs/feasibility/request/
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