How to collect and review data effectively
In a world fixated by data collection, businesses must decide what numbers are useful and which are simply confusing the picture.
Number of sales, profit and turnover are key values to consider, but a modern company might also have to keep track of interactions with their posts on social media, visits to their website, or online ratings from customer reviews. Each piece of data tells its own story, which might only be relevant to a certain people within your organisation. The challenge is presenting this information as coherently and concisely as possible, so the right people can make the right decisions from it.
A limiting mindset – All data is good data
With tools such as Google Analytics, it is easier than ever to collect a wide range of data, with minimal effort. This is of course a positive, as companies can assess their performance more objectively by reviewing the numbers. However, the belief that all data is good data is not necessarily accurate, particularly given that analysing it will more often than not take far longer time than collecting it.
If your organisation is harvesting an excess of numbers, some of which aren’t useful to anyone’s decision making, then something is wrong. As well as this, if you are collecting useful data, but not reviewing it, this is equally, if not more problematic. Swollen spreadsheets, sent from analysts to leaders might seem like they are illustrating the full picture, but are in fact confusing the people who most need to understand them. Consequently, this reduces their confidence and increases the chance of poorer results.
A missing element – KPIs
Identify your business key performance indicators (KPIs), which communicate the most vital information to facilitate effective decision making. This might vary from person-to-person across your organisation, so ensure everybody knows what numbers are most relevant to their specific job. Having this greater focus will allow managers to assess the information more quickly, whilst also increasing the accuracy of their respective actions, as they are less confused by a surfeit of data.
It's up to the leaders, heads of departments and managers to specify what numbers they feel are most useful, but then the task of amassing and communicating these KPIs should be passed to a technical expert. They can narrow the search and set up systems, so the correct information is sent to the people that require it. Leave this specialist task to an already busy leader and the likelihood is that it won’t get done. If you don’t have an expert at your disposal, think about employing someone initially to set this up.
A different perspective – Dashboards
From my experience, the best way to communicate important information within a business are dashboards. These present the KPIs in comparison and opposition to each other, to build up a broader, contextual picture of the past and current situation. If all data is housed within one central system or piece of software, then tailored dashboards can be communicated to different people across the company, without too much effort.
Options for suitable dashboards might include:
Sales dashboards: That might track the number of sales of a variety of products, or across a variety of locations. This would allow the head of sales to review the results to consider which offerings are most popular, which might need repositioning and which are producing an insufficient return.
Marketing dashboards: Which compile the number of likes, interactions, or subscribers from the different forms of marketing material your company produces. This might be fed from by a CRM and would be assessed by the marketing manager.
Internal performance dashboards: These are less common but would show how individuals and departments are performing with regard to their targets. A positive outcome of introducing these dashboards is they increase accountability and often stimulate engagement and productivity.
Reviewing data can sometimes boring or even daunting if you have too much of it, therefore, I encourage my clients to follow these three steps to ensure the information they collect is being utilised.
1. Identify your KPIs and ignore unnecessary numbers
2. Establish an effective way for these to be communicated
3. Consider them regularly and set future goals as a result
Data doesn’t have to be dull. Used correctly it is one of the most accurate ways of judging a company’s success. Like all things, apply moderation; don’t let your business drown in irrelevant numbers.