Successful businesses have always relied on some form of data to make decisions. Leveraging data properly is becoming increasingly important with more and more small organisations finding themselves pitted against established players, whilst using small teams with very modest margins.
According to the UK government, data will benefit the UK economy by up to £241bn by 2020, and much of that will be going to small businesses.
With data analysis proving to be vital to the success of so many companies in the future, we chatted with our client Tim Shaw, founder of Modus Analytics, to find out more about how data is changing decision making and how smaller and medium sized companies can be utilising data analysis to give them a leg up as they grow.
Tim Shaw – Managing Director, Modus Analytics
Established in 2018, Modus Analytics was created to help small businesses to utilise data and make smart decisions. Tim’s passion for data was born out of experience developing systems that utilise data in organisations that he has led combined with the normalisation of data in everyday society.
‘For example, if you think of Amazon’s Alexa or Netflix and how they reference what you want to watch next, these tools are using data analytics or some kind of machine learning software to make your life easier and also generate increased profits for those businesses’.
According to an IDC whitepaper, by 2025 the global datasphere will grow to 163 zettabytes which equates to over ten times the amount of data generated in 2016.
“The amount of data that we collect now is billions times more than we have done historically. Microsoft and other companies provide data analytic software which anybody can access and use extremely cheaply.”
So, what is putting businesses off using data more readily? Part of the problem is a misconception around data itself; what data is available and what is involved to interpret that data properly. Many businesses are dazzled by the term ‘big data’ – the phrase used to reference the amount of data which exists in the world. It is this same term which can make some small and medium sized business owners feel uneasy about using data, sensing it is inaccessible to them. They can also be daunted by the scale of the data they think they already hold.
‘Unfortunately at the moment people see “big data” as data that is relevant to large companies, and this simply isn’t the case. It is absolutely accessible to them as long as it is approached sensibly.
As it turns out, many businesses don’t have a complete picture of how much data they’re collecting. According to the latest annual Data Security Confidence Index from Gemalto, 65 % of companies have too much data with just 19 per cent of UK organisations being able to perform data analysis effectively.
For companies looking to get started, it is critical to ask the right questions first. By understanding the goal, it becomes easier to identify what the right data to gather is. More often than not, business won’t be aware of what data they have.
‘The owners and senior managers should sit down and think about the challenges they’re facing and what are they trying to achieve over the next couple of years. Answer those questions first and then ask yourself are we collecting data that allows us to answer these questions’
If you’re reading this and thinking data in isolation sounds like a dangerous thing then you’re in good company. As Antonio Damasio‘s, research in neuroscience has shown, emotions play a central role in social cognition and decision-making and this is the difference between being data driven and being data informed.
Data driven businesses will use data to make decisions where as data informed businesses will utilise data to inform their thinking.
‘In our opinion a mix of perception and the right data is the ideal position to be in which is why on our website we have created 2 or 3 very simple human behavioural tests to prove a point that if you rely on intuition alone you might make the wrong decision.
Part of the reason Modus Analytics decided to commission a video to accompany the launch of the business was to address the range of understanding around data.
Some businesses had a sense of the topic, whereas others really had very little awareness. The critical outcome of the video was to get their prospects thinking about the information they are already sitting upon and what they could be doing with it.
‘One of the reasons why the video was so important to us is because you get a range of responses from – yes, this is something that the Amazon’s of this world do, but I had no idea we could be doing the same thing too, we had thought about how to use our data but had no idea where to start”.
If you would like to get on top of the data your business is already gathering or would like to explore new ways to exploit data to meet your goals, we recommend you get in touch with Tim and his team at Modus Analytics at email@example.com