Deriving Insights from Data: Why and How to do it?
Business success is highly dependent on how good the company is at getting and utilizing data. There are many data insights examples that constantly provide a competitive edge for businesses and profitable opportunities for investors. However, deriving insights from data also requires initial investments of resources to get the data. And then what follows is hard work to actually turn data into valuable information. Thus, one might wonder if it is the best option for them right now. And even in that case, how does one ensure that they will be able to turn data into business value? Let us look over why and how insights pulled from data are currently the best bet for most businesses.
The benefits of data insights
The “why” part of deriving insights from data seems pretty clear for most nowadays. Still, it might be a good idea to go over why it is worthwhile to invest in changing your business approach to a more data-driven one. After all, big data is only going to be more and more prominent in business and the earlier one accepts the easier it will be in the future.
There are many reasons to turn to data when looking for the best option to boost business. The following benefits are the ones that stand out for many businesses and financial firms.
1) Cost-effectiveness. Even considering the initial costs of investment when starting out to utilize big data, it pays off and it does it fast. The knowledge that is uncovered by data analysis will open up new market opportunities and help to stay on top of the vital trends. These new insights are more than likely to turn into profits both for investors and businesses.
2) Multiple use cases. There is virtually no limit to the areas in which data can help. From competitive intelligence to product development and business strategy, every crucial decision is made better by information. The same goes for investors, who can find new start-ups and undervalued stocks to back up by analyzing alternative data along with traditional ones.
3) Improved procedural efficiency. The insights derived from data might reveal which internal procedures are lacking in effectiveness. It might be possible to cut the cost of certain procedures or to make some processes faster by implementing technological solutions. Data can back up such managerial choices with hard numbers. Furthermore, the very flow of information within
the company can make or break it. Thus, it is always a good idea to look into new tools that can make sure that everyone gets the information they need on time.
4) It is easier than ever before. Implementing new data-driven solutions might have been hard before, but nowadays one has plenty of opportunities and resources for it. There are many esteemed data suppliers ready to provide you both with the data and the tools to work on it. And the talent pool of data engineers and skilled professionals in the field is constantly growing. Thus, all it really takes is a decision to go along with big data into the future of business.
The ways of deriving insights from data
The most important question about deriving insights from data is how to do it effectively. There is more than one answer to this question since companies and investors can take different approaches to it.
Firstly, it is possible to attempt to do everything yourself. That means gathering all the necessary data, hiring an in-house team of analysts, and providing them with all the tools they need to extract the insights. Naturally, this way has the advantage of total control over everything related to knowledge extraction. However, it also has the disadvantages of requiring a lot in terms of costs, time, and attention.
For many firms, this is not a viable solution. Thus, secondly, it is worthwhile to look at the other end of the spectrum and hire outside help to deliver the knowledge to your doorstep. There are already firms that can provide you with insights on demand, meaning full-fledged answers to your questions that require little to no additional information. This is the fastest approach, but its disadvantage is that there is little flexibility for you to get something different from others who opt for the same service.
Finally, there are many middle-ground ways of deriving insights from the data. You can get some of the data yourself while supplementing it with data sets from a third party. Or you can get all the raw data from outside but do the work with your in-house team. And, of course, it might be the tools and the expertise that you outsource to turn your data into valuable insights.
This final way is of course the most flexible, as you can change the approach with every new task at hand. Sometimes you might see it fit to do everything in-house, while other times getting some outside data and assistance will be the way to go.
In any case, the way to make your company more data-driven is ultimately your choice. There is no one
right method of deriving insight from the data. It all comes down to what you need and what you are capable of achieving at a particular time. Having your resources and opportunities figured out, you will be able to choose the right strategy to further implement a data-driven approach to deriving business intelligence.