Data & Financial Inclusion | |
Data & Financial Inclusion | |
994 VIEWS | |
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Wednesday, February 17, 2021 / 08:30AM / By FCMB Business Zone / Header Image Credit: Northeastern University
We are in a
digital world where DATA is referred to as "the new oil" because of its
economic power; just as OIL was in the industrial age. With data, business
owners can now make more informed decisions regarding their customers,
processes, platforms and people. The ability to collect, process and analyse
data effectively is one of the reasons big tech companies like Google,
Facebook, Amazon, Apple and Microsoft continue to thrive in today's world.
Similarly, small and medium scale enterprises are beginning to understand and
appreciate the use of data for product development, customer management,
financial management and more, to improve their service delivery, reduce
inefficiencies and attract new customers.
Data is
simply any information that can be translated into a machine-readable form. As
a small business owner, you should not assume that making decision using
data is only applicable to large organisations, rather you should embrace and
incorporate the collection, processing and application of data driven insights
in your business process in order to ensure you develop strategies and
activities that benefit the business while gaining an edge over your
competition.
Some data
types available to small businesses include customer data, employee data,
transaction data, web, and social media data, etc. With data, it is easier to know what works
and what does not as a business owner. Thus, it is important to collect data no
matter how minute it seems.
Want to turn numbers into inspiring stories and create compelling data
dashboards for driving strategic data-driven decisions? Join the Data Science
Nigeria Vizualisation Masterclass from February 27, 2021. Click HERE to register or
send a message to market@proshareng.com
In this
article, we discuss some data types and give tips regarding how they can be
tracked and used in making decisions.
Customer
Data
This
includes all personal, behavioral and demographic information about the people
and businesses you serve. Customer data is essential to understand your
customers' expectations and how your business can meet them. This data can be
collected through your website, email, SMS, social media platforms, surveys,
sign up forms or one-on-one interaction on call or in person.
It is not
enough to collect these data, it should be stored and processed using customer
relationship management tools such as hubspot, Zoho or Salesforce which have
features for lead tracking and management, sales forecasting, email marketing
and integration with other tools. Analytical tools such as google analytics and
social media analytics are also easy-to-use tools that can be adopted to
improve and optimize online marketing initiatives.
Some of the
insights you can gather from processing these data include how often purchases
are made using a particular channel e.g. social media; the days and time you
get more sales; the persona of customers that purchase from you the most; the
products / brands they buy the most; their interests; the devices they use;
their location, etc.
With these
insights you can target your message appropriately to the channels that work,
develop products that meets the needs of the demography type that purchase from
you the most and introduce attractive offers on the days or time you have the
most visits to your platform.
Financial
Data
This include
information related to monetary transactions within your business. This
information is often seen in the financial statements of an organization, that
is the balance sheet, profit and loss or cash flow statement. For every
business owner, analysing this data helps to understand the revenue and cost
drivers of your business. In addition, it helps to plan adequately and answer
salient questions that can help gain insight into specific areas of the
business.
For
instance, you can ascertain the products or line of business that generate the
highest sales, the impact of marketing expenses on sales, and budget / plan
ahead for future expenses such as the purchase of new assets or expansion into
other business ventures. In addition, information in the balance sheet helps to
determine liquidity, solvency and the future viability of the business
continuing operations.
Employee
Data
This refers
to all employee related information collected by any business. It includes but
is not limited to personal information about employees as well as information
about their work performance. Insights from employee data enable business
owners effectively manage the hiring and talent management processes of the
business.
Some other
advantages of employee data include the measurement of training initiatives on
productivity, the alignment of employee behaviour with the business' goals and
objectives, and the assessment of factors that result in high turnover or
retention with the business. Overall, it is important to understand the needs
of your employees in order to ensure they are productive and work towards the
achievement of the business objectives.
To
effectively, track and make informed decisions using data you need to:
1.
Have specific objectives you want to achieve and the
questions you want answered.
2.
Ascertain the type of data you need to collect.
3.
Identify the sources of the data you need and the
tools needed to collect them.
4.
Adopt management tools that can enable you store and
analyse the data collected.
5.
Take action based on the insights gained from the data
analysed.
6.
Monitor actions taken and ensure continuity in the use
of data by ensuring you and your employees get trained where necessary.
Like Andrew
Chen, ex-Head of Rider Growth at Uber said "It's important to leverage data
the same way, whether it's a strategic or tactical issue: Have a vision for
what you are trying to do. Use data to validate and help you navigate that
vision, and map it down into small enough pieces where you can begin to execute
in a data-informed way. Don't let shallow analysis of data that happens to be
cheap/easy/fast to collect nudge you off-course in your entrepreneurial
pursuits."
While it is
important to collect data and leverage on them to make informed decisions, it
is also critical to ensure compliance with all data protection and governance
regulations to avoid sanctions which can be detrimental for your business. You
should also ensure to keep yourself and your team abreast of information and
data security threats while ensuring to have in place measures to help mitigate
these risks.
Credit: This post first appeared on FCMB
Business Zone HERE
Previous Posts for Small Business Owners
1. Why Small Businesses Need a
Digital Presence
2. The Legal Side of Doing Business in Nigeria: Compliance
Checklist You Need as a Small Business Owner
3. Effective Ways to Fund a Small Business in Nigeria
4. Financial Strategies to Help Grow Your Business as an
Entrepreneur
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