When faced with a big decision for your company, how do you decide which path to take? According to a recent report from PwC, if you want to choose a successful path, data needs to drive the decision.
According to the report, highly data-driven companies are three times more likely to have a significant impact from big decisions than those that don't rely heavily on data. But at the same time, only one in three executives says their organizations are highly data-driven.
The big decisions in the study aren't those once-in-a-lifetime types of decisions. More than three-fourths of executives say they make big decisions each quarter, and nearly half of those (43 percent) review them each month.
"A company's success today is tied to how good it is at making big decisions," says Dan DiFilippo, PwC's global and U.S. data and analytics leader. "While executives say they continue to rely on experience, advice, or their own gut instinct, they also see investment in data and analytics as critical to success. Experience and intuition and the use of data and analytics are not mutually exclusive. The challenge for business is how best to marry the two. Executives know the right questions to ask. Now they need to know how to get the right answers from external and internal data they've used over the last two years."
A survey conducted by MDM and Real Results Marketing during the fourth quarter of 2013 revealed much the same thing: Distribution executives are aware of analytics and that they should be incorporated into decision making – but they're not to the level yet of applying data to all of the "big decisions."
About half of the respondents to the MDM-Real Results survey said they rely on analytics for "some, but not all our sales, marketing and operational decisions." About one-third only uses it as a "report card" for monthly and quarterly performance.
Part of the challenge is just the sheer amount of data and how it can be applied. “There’s a learning curve," says Jonathan Bein of Real Results Marketing in Avoiding Information Overload Essential with Analytics. Start small and focus on one or two areas that you know can have a big impact quickly, he says.
The bottom line is that the best decisions are based on data, as noted in the PwC study: To gain a competitive advantage, "adopting a structured test and learn approach by specifying changes to the organization, process, technology and culture are needed to improve decision making."