Using data to make decisions is one of the best ways to achieve your goals and feel confident navigating the world of being a business owner.
When we focus on data, we’re able to make decisions that are grounded in reality and fact. That means that, instead of following your gut, you’ll be able to back up any decision you need to make with proof and evidence.
And that’s a super validating experience for every business owner to have! A huge part of running a business is needing to make decisions big and small…and sometimes, it’s challenging to know what the best course of action is. With data, you’ll feel so much more confident that you’re making the best possible decision.
What Does Using Data To Make Decisions Actually Mean?
When you’re going to start using data to make decisions, you’re going to need to select KPIs (key performance indicators). These are going to be the essential metrics you track and analyze. And those KPIs need to be highly aligned with your goals (for example, increasing organic traffic).
When using data to make decisions, you’re able to use those KPIs to choose paths of action that match your overall goals. But in order to do this, you’re going to need to understand the different types of data available to you: qualitative and quantitative.
Qualitative data is focused on storytelling data, not numbers. You’d gather this type of information through strategies like surveys and interviews.
Quantitative data is all about the numbers! With this data type, you track different numbers and use statistics to analyze patterns. Oftentimes, when people think about data and metrics, they only think of quantitative data (and it is super important). But remember that both types of data are helpful, and which type you use really does depend on your goals.
Why Is Using Data To Make Decisions So Important?
Now that you understand what data-based decision-making is, let’s talk about why using data to make decisions is such a good idea.
There are lots of benefits to data-driven decision-making. You’ll be able to pursue new opportunities (and turn down misaligned opportunities), create more revenue and profit in your business, and use strategies that really work. All of these things lead to one overall benefit: business growth!
When you’re using data to make decisions, you’re setting yourself up for success in lots of ways. You’ll be able to optimize your efforts and move your business forward in the right direction (for long-term growth!).
Here are four essential reasons you should be using data to make decisions in your business.
You Can Really Hone In On Your Goals and Achieve Them Faster
One of the big benefits of using data to make decisions is being able to track your progress towards achieving your goals.
But in order for that to work, you have to consider the data when you’re setting goals, too. As you’re setting your business goals, make sure that you base those goals on your business data! Set realistic milestones using your actual numbers and track record.
You can also use the data to strategize how you’ll achieve your goals. This helps you stay focused! You’ll know that if you want to achieve more revenue or reach a wider audience with a social media ad, you’ll need to pursue specific courses of action (and you can figure those out using data patterns in your business).
You’ll Be More Confident In Your Decisions
Perhaps the best part of using data to make decisions is the confidence that you’ll gain. For many business owners, making decisions feels like stumbling through the dark or navigating uncharted waters. Data serves as a light (or a map) to help guide you toward the right path.
There are lots of reasons that data-based decision-making will be easier (and help you feel confident). First, you’ll be able to benchmark what’s currently working and what needs improvement in your business. That way, you can understand HOW the decisions you make need to influence what’s happening in your business.
Second, you’re able to believe in the decisions you make. Even if you would’ve made the same decision by following your gut, having the data on your side validates you, which is a really great feeling.
When Using Data To Make Decisions, You’re Able To Be More Proactive
Another benefit of using data to make decisions is being able to be proactive instead of reactive. When we’re making decisions without data, we feel super reactive. We don’t know what’s going on or what strategies work, so we react to problems and challenges as they occur.
But with data, we’re able to be super proactive! At any time, we can dive into our numbers and get a snapshot of our businesses on different levels, which lets us anticipate problems and wins before they happen. We’re actively steering our decision-making all the time, versus reacting to something that feels incredibly urgent.
Being proactive will help you foster growth in your business. You’ll be able to spot opportunities much faster and pursue what’s really going to generate results.
You’ll Save Money and Time By Figuring Out What Works
Finally, using data to make decisions saves you money and time. There are a TON of costs that go into running a business (and those costs are financial and time-based).
With data, you can pursue the strategies that are working best, which saves you money. If Facebook Ads generate tons of revenue and website visits in your business, but Google Ads don’t, you can eliminate or tweak your strategy to save money.
Data also helps save you time, too. You can evaluate productivity metrics and figure out what areas of your time need to be optimized, delegated, or outsourced.
Running your business will be more efficient than ever before if you start using data to make decisions!
No matter the size of your business, using data to make decisions will help position you for incredible long-term success and growth. These four benefits are only the beginning of the change you’ll experience when you focus on data and metrics in your business.
Learn more about using data in your business with these other posts:
- How To Use Data To Skyrocket Your Business Growth This Year
- 5 Data Metrics You Shouldn’t Track and Measure In Your Business (& Why)
- 8 Business Mistakes To Avoid In Order To Be More Successful