DON'T MISS OUT: HOW TO EXTRACT FULL VALUE FROM YOUR ANALYTICS

Analytics is more than deciphering data. Using sound information guides decision-making. It also reveals underlying problems that can cause business havoc. Businesses have increased their investments in analytics in recent years, enabling them to now garner insights from the massive volume of data captured in various applications.

To extract insightful information from data, businesses need to understand their motives for analytics and have a plan on how to use the information. Five areas should be considered:

1. Clarity on Information Need
List the questions to be addressed. The questions help develop the scope of the analytics work. What a senior executive needs could be very different from the needs of a team leader for procurement. This scoping is important as it provides the business direction for the information use. Without it, amassing the data could mean going in circles. Scoping also identifies the data need. Work with the users of the information on this.

2. Approach to get Quality Data
It is likely that data will be sourced from multiple applications. There could be issues with consistency, completeness, accuracy, and timeliness. Extract sample data and review it for deficiencies. Determine how best to prepare the data needed. It might be merging, cleaning, grouping, or using surrogate data. Take note of the assumptions made as they would affect the interpretation of the information.

3. Premise for Action
A key purpose of analytics is to provide evidence for taking action. Data offer a snapshot of the past. To initiate actions, a gauge must be established to assess the significance of any deviation, to avoid knee-jerk reactions. This implies a need for analyzing the pattern of performances and deviations.

4. People Best Suited
Not every employee makes a good analyst. Some analysts are better than others. Individuals with an aptitude for tackling problems and skills for digesting information are better suited to do excellent analytics work. They understand the business issues that drive the focus of the analyses. They are open to explore the messages that data present. They are quick to assimilate information from different analyses and create a cohesive picture in the proper business context. Certain technical skills can be developed, but identifying the right talent for the job is essential.

5. The Right Tool
Despite the availability of diverse business intelligence tools, many businesses still rely on basic applications such as Excel to prepare reports and dashboards. But often, these basic tools consume more time and effort. A proper business intelligence tool can make the job more efficient. However, business intelligence tools have limitations as well. Some are better with data visualization, while others are efficient with data consolidation and preparation. Evaluate the company's needs and assess the return on investment in the tool selection process.

Many businesses think that investing in a sophisticated tool addresses the need for analytics. But the tool doesn’t provide any insight when it's not clear what questions need to be answered and what the company can do with it.