Are You Taking Advantage of Data? (Part 1)
Why Data?
“I never guess. It is a capital mistake to theorize before one has data. Insensibly one begins to twist facts to suit theories, instead of theories to suit facts. ”— Sir Arthur Conan Doyle, Author of Sherlock Holmes stories (http://www.analyticshero.com/2012/10/25/31-essential-quotes-on-analytics-and-data/)
“[…] use analytics to make decisions. I always thought you needed a clear answer before you made a decision and the thing that he taught me was [that] you’ve got to use analytics directionally…and never worry whether they are 100% sure. Just try to get them to point you in the right direction.” — Mitch Lowe, Co-founder of Netflix— (https://blog.kissmetrics.com/how-netflix-uses-analytics/)
We are all sitting on a pile of gold in our organizations — the insight we can gain from our data.
What’s holding us back?
The following article contains interesting observations around the NEED to use data to aid our decision making.
Data Analytics Has Become Essential to Modern Business
I recently attended an accounting CPE session that drove home the point that data analytics is a major trend impacting our profession.
Yet, the accounting industry is severely lacking in adapting to this change.
Analytics is essential
Demand for analytics skills is obvious
Opportunities to leverage analytics is obvious
The opportunity and need are obvious, however…
I found that statistic shocking and sad. The accounting profession, of any industry, should be data gurus.
It’s what we do.
But we are largely ignoring it…
Let’s Change That
Within the accounting firms, accountants in industry, and at our clients, it starts with building a culture of data first AND developing the basic skill sets for data analysis.
Although there are a plethora of tools available, in my opinion, this journey begins with a solid foundation of database structure knowledge and Microsoft Excel and Access. Throw in Google Sheets (Google’s spreadsheet tool) as well just to really expand the data possibilities.
Add to that, a curious mindset to explore data, derive insights and communicate information, and the value of analytics will quickly become obvious.
The article below highlights the broad steps in the process of developing an analytics process:
- Planning
- Defining objective
- Collect the relevant data
- Analyze the data
- Take an action (i.e., communicate, educate, inform, and base decisions off of the data)
Conclusion
In a future post (Part 2), I will share specific examples of simple data resources that have seen applied at organizations I have worked with.
The key of the examples is it is common data, NOT “big data”, and highlights the types of readily available information that can be used to provide valuable insight for your organization.
About Don
“It’s time for different”
Don is passionate about helping professionals and organizations keep up and adapt to the changing business world that we operate in.
“What Do You Do?”
I frequently get this question. My response (it’s not what you think!)? Check it out here!
