Do you know anything about a data-driven approach? It is used everywhere – there is a data-driven approach to projects, a data-driven approach to workforce planning, to growth marketing, to developing – it’s applicable to virtually anything. In this article, we will talk about whether it is the one and only approach you should use in your work or your road is going to be more bumpy and difficult.
What is a data-driven approach? As you might have guessed already, it is an approach that implies using data. Large amounts of data. An amount enough to guide and drive the whole analytical process in your company.
Let’s follow the development of data-driven culture at an any-name-any-size company.
The company starts as data-resistant. It intentionally acts against data results, data is intentionally dismissed, and all decisions are made solely based on the subjective wishes of the owners and decision-makers. It is not the best approach in the 21st century because it naturally leads to collapse (not always but often).
Owners and decision-makers don’t want their company to go bust and if they are smart they start moving towards data. The company first becomes data-aware and only partially takes advantage of data; then it develops to be data-guided and starts using data in the production process. After that, if the results are good, it transforms to be data-savvy. By the end of its development, it evolves to be data-driven (by the way – if you want to be data-driven you need a full-cycle analytics service).
The company can be considered a data-driven company the moment when data becomes the key factor for decision making, not the moment it collects plenty of data.
What if there are a lot of reports made in a company. Is it data-driven? Not necessary. The existence of numerous reports doesn’t mean anything. We don’t even know how they are used or affect decision-making.
Let’s take a look at a process chain at a truly data-driven company. We take data, compile it into a report. The analyst analyses this report, then the person who makes decisions reads it. Then action is taken that will later result in some value. This is a typical data-driven chain.
So, is it Really a Pinnacle?
No matter how much we praise the data-driven approach, it’s not the pinnacle of company development in terms of utilizing data. There is a relatively new concept of being “data-informed”. The data-informed approach is the approach in which utilizing data is one of many factors in decision-making.
The data-driven approach allows you to simply straighten your business out and make the best out of what you already have. However, if you want to move further, you will need to use other factors besides data – and those factors are (surprisingly!) our intuition and expertise – the two things we tried hard to get rid of at the beginning of our evolution to data-driven decision making.
However, if you want to keep your business evolving, you will need to be a visionary, come up with some fresh ideas that can turn it in a different direction, and take it to the next level. After you do it, you again will need to use the data-driven approach to find your way to the top. This process is actually endless.
So, to sum it up. Your decision-making should always be based on data (be ‘data-driven’). However, after you exhaust all the options granted by the data-driven approach, it will be time to stop and look around. And start implementing a more creative data-informed approach that may produce unexpected (but good!) results.Try out a FREE demo of devtodev – a full-cycle analytics solution for apps and games that helps you convert users into paying users, predict churn, revenue, and customer lifetime value, as well as analyze and influence user behavior.