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How To Analyze Your Business Data For Better Decision-Making
(This is a contributed post)
Data analysis is not the fanciest thing in the world, but it is essential. Businesses are fuelled by data nowadays, and it’s your job to make some sense out of it. How do you do this? Running a data analysis can be extremely tricky, particularly if you don’t know where to begin. The following points give you a rundown of what to do and how to prepare for the analysis:
What and why are you analyzing?
Begin by figuring out what you are analyzing and why you are analyzing it. There is an absurd amount of data in your business, and you can’t analyze it all at once. Begin by asking yourself why you need to analyze anything in the first place. What is the purpose of this analysis? Here, you’re looking to answer a specific question or tackle a problem point that your business is experiencing. For example, why are you struggling to retain customers? Right away this sets you up for what you need to analyze.
In this scenario, you will analyze data relating to your customers. You’ll see their purchasing habits, look at their interactions with your business, and start to identify any patterns or trends that emerge. Hopefully, the results will let you know the answer to the question.
Collect and analyze your data
Once you have decided what data should be collected, you need to turn to all of your data sources to gather it. At this stage, you will definitely benefit from some data analysis tools and software. There are plenty of great options on the market, and they all serve similar purposes. Essentially, these tools or software applications will help you collect all of your data and sort it into different sets. It makes the entire process so much easier than doing it all by hand, meaning your analysis can take minutes rather than days. At this point, you have all the data you need, and it has been analyzed for you.
Interpret the results
Ironically, the hardest step comes right at the end. Having all of your data is one thing, understanding it and interpreting the results is another. This is where many business owners falter as they can’t figure out what the results mean. In fact, quite a few business owners are starting to get an analytics degree online to help them interpret the results better. Data analysis is so much easier when you know what you’re looking at and can interpret it yourself, rather than getting someone to do it for you.
Realistically, you are interpreting the data to see if it answers your initial question. You also need to look at it and see if there are any potential drawbacks that might require more analysis of a different set of data. It’s all about drawing the right conclusions and understanding how to use the data to formulate better decisions for your business.
When you break data analysis down like this, you realize there are only three steps to it. Start by figuring out why you need to run the analysis and what you will analyze. Follow this up by collecting and analyzing the data before ending with your interpretation of the results.
