- How much data do you have in the business?
- When was the last time you turned it into knowledge?
Every business has a lot of data; all those invoices, sales opportunities, marketing activity results, proposals, CRM entries – the list is endless. Data is, I’m afraid, not a lot of use to anyone and if it wasn’t for the belief that we will, someday, make use of it (and the occasional law) we’d throw it away pretty much as soon as we had used it the first time.
Turning all that data into useable knowledge is something that can help your business improve its performance.
Data into information
The first stage is turning the data into information. What I mean by this is translating it into something that makes sense to the reader rather than piles of numbers and letters. Your accountant does it, at least, monthly for you when they turn your invoices, receipts and bills into management accounts – they tell you what you have to work with in the next month. You can also do it to help improve your business performance. Some suggestions:
- What is the average spend per client and how does that vary between clients?
- How many times per period (you choose) do your clients buy from you?
- When are your peak trading periods?
- How long do you keep a client?
Information into knowledge
The next stage is turning the information into knowledge. What does the information mean and what can I use it for? Lets look at the possible answers for the questions above:
Question: What is the average spend per client and how does that vary between clients?
Answer: £152 – £638 per month
Knowledge: What related products/services can you sell to the lower spenders? Are they aware of them?
Question: How many times per period (you choose) do your clients buy from you?
Answer: Three times per month
Knowledge: If you can sell to them one more time per month, you add at least 33% to your bottom line and probably more.
Question: When are your peak trading periods?
Answer: September to December
Knowledge: Get more staff or products in time and you can further increase your sales in this period.
Question: How long do you keep a client?
Answer: 4 months
Knowledge: Keeping them just one month longer adds 20% to revenue
With a little bit of analysis, how much knowledge could you get from your company data?