With the Big Data revolution, new processes have risen to give organizations a data-driven approach and replace the old intuition-oriented one. Data-driven decision making is one of these processes. It focuses on running a business solely on the data they collect from its market, sales, operations, and human resources.
It's not just about having data in mind when making a decision, but to be steered entirely by it.
Continue reading to find out how you what it is and how you can begin making more decisions based on data.
Data-driven decision making (or DDDM) uses facts, metrics, and data to guide your business decisions. It's the approach that companies like Google, Corel, or The North Face use to get an edge over the competition and make the most business-wise decisions.
This process is here to replace the old intuition-based management. That one used in the past century that works on bosses' feelings or "hunches."
It's such a powerful approach that when everyone at the company follows it, discussions are shorter, and decisions directly impact the market or team.
But how can you begin using DDDM on your team?
How to start with DDDM
Approaching a specific area or topic from a data perspective feels natural today, but the usual intuition-driven thinking still rules in some teams. Let's see how you can start making decisions on your team based on data:
- Set clear goals: with all the data your organization gathers in a quarter, spending the time and resources from your team and third parties should have a clear purpose.
- Let's set a goal of increasing on-time delivery by 80%
- Following these goals, start to collect all the data you already have from past activities and gather the most relevant KPIs. You can use an app like Retimer to manage the times from your team's meetings and money spent.
- What do you think your team needs to deliver value faster? Let's focus less on talking and more on doing. KPIs: # Hours spent on meetings, # money spent on meetings, % productive meetings.
- Develop strategies to grow or decrease those numbers. At Moka, we have a meetings spreadsheet where we rate how valuable a meeting was, if the right people attended it or not, and more.
- Review the progress frequently. This part is crucial to know how impactful your strategies are. It helps you to take action faster and be aware of your plan.
- You can ask someone to held accountable for keeping tabs on the plan and ask them to report regularly.
- Once the deadline for the business goal is passed, show the journey to your team, report gains and losses and retrospect on what you could've done better, and move on to the next step.
Data is everywhere, and it's crucial to know how to handle it. Rather than running away from it, we must find ways to embrace it and use it in our favor if we want our business to survive, regardless of the industry we're in.
Practicing a data-driven decision-making approach is challenging, but in the end, smart work always pays off, whatever you do.