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Data-Driven Decision-Making (Role of Information and Data in Business | Assignment Sample)
Modern businesses can be described as operating in a data-driven environment. Therefore the role played by data and information is of empowering the business leaders in making their decisions on the basis of facts as well as on the basis of statistical numbers and trends present in the marketplace. However as such a huge amount of data and information is available, it becomes necessary for the business leaders to sift through the noise and base their decisions on the right information so that the decisions made by them are the best decisions related to development and strategy.
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Information and data remain at the heart of nearly every decision made by businesses. For example, the human resource directors of the organization collect data from online resources to decide which persons are the best to recruit and to confirm the details related to such employees. In the same way, the marketing departments of the organizations depend on the market segmentation data for the purpose of finding customers who can buy their products and also for speeding the sale closing process when it is possible to do so. In this way, the business executives are also required to examine the present trends in the marketplace like the changes taking place in the pricing of resources, manufacturing or shipping (Sriram, 2008).
The effective use of data and information allows the company to streamline the process of the creation of a product and place it into the hands of the consumers. Therefore the costs that can be saved by not becoming involved in shotgun advertising or not having to pay excessively for the resources can significantly impact the bottom-line profits of the organization. In this way, considering the relevant data and then incorporating such data into the strategy adopted by the organization is the responsibility of the managers.
It is necessary for organizations to develop strategies related with sales, marketing and human resources etc. Therefore by updating the right information, it is possible for an organization to know which information is significant for the decision-making process of the organization. The beginning of this strategy takes place with basic demographic data. Then it considers the issue of pricing on the basis of education and the income of the consumers and how such a group speaks. In this regard, income and education play an important role as the higher income and more education is present in case of the target group, the more likely it is that the organization will be logically able to sell high-end products to such a group as this group of consumers is in a position to understand and appreciate as well as to afford such a product (Mayer-Scho?nberger and Cukier, 2013).
Case Study: Designing a Skincare Product Marketing Strategy
An example in this regard can be given of a new skincare product that the company wants to offer to the women consumers. In this regard, there are a number of significant factors that should be known to the company for the purpose of effectively designing and executing its marketing strategy. Even if the product may not work for all the woman customers, it is important to know if it is going to be granted more for the younger teen consumers. Or if the product is going to be branded for the ageing woman consumers who want to hold on to their youthful looks. In this way, the design of the label is going to be different in the case of each group of consumers. Similarly, a high price may not be affordable for young consumers but it may be necessary that the research which supports the claims may be required for selling the product to the professional and educated older woman even if it is priced highly.
In such a scenario, it becomes important for the organization to have data related to the cost of the goods sold in the market along with the ultimate price of the product and which group of customers is most likely to buy the product. Then the organization can design needs complete packaging around the biggest segment of the consumers even if other groups of consumers may also purchase it. Therefore the analytics is not to consider the number and size of the group but at the same time, it will see the specific demographic in response to visual stimulation. Particularly in the case of the young millennial group, packaging has become significantly different as compared to the packaging that is going to be used for the baby boomer demographic (Davenport and Harris, 2007).
The Significance of Effective Data Usage
It is not only sufficient to have the data and information available to the organization. Therefore it is also necessary that the data is used effectively by the business leaders for making the decisions. An example in this regard can be given of a manufacturer of cell phones who uses the components that are made in China. In case the tariffs have been reported on such a line of components, the cost of the phone is going to increase. Therefore it becomes important to understand the effect of data and what it is going to do for the profit margin of the business owner. This factor is very significant for the development of a strategy that can help the company remain profitable. At the same time, it is possible that the business even may try to find a new resource for such components as they may be less likely to be affected by international political situations or tariffs. Under these circumstances, it is possible for the business to make a decision in favor of increasing the cost of the final product and in this way to effectively pass on the new cost to the consumers (Schutt and O'Neil, 2013).
In the beginning, it may also be decided by the company that it is not going to take any steps and the higher costs will be absorbed by the company. The reason behind this decision can be that the company has a sufficient profit margin and will still remain successful while a number of competitors of the company may be in need of increasing the price of their products. In the case of this strategy, even if the profit per sale is going to be reduced it may increase the demand for the products of the particular company as it is going to be priced more competitively as compared to the other companies and therefore the increase in the market becomes imperative.
Under the circumstances, it needs to be noted that data can be described as the plain facts and the statistics that have been gathered by a business during its operations. Therefore it is possible to use data for measuring or regarding a large number of business activities. These activities include the external as well as internal activities of the business. Therefore even if the data in itself may not prove to be very informative, it certainly acts as the grounds for all reporting and as a result, it is very crucial for businesses. Consumer data can be described as the matrix that is related to the interaction of the consumers. At the same time it can be related to the number of jobs, the income received, the number of inquiries made and the expenses incurred. For the purpose of knowing about the interaction of the organization with its customers, there is always the need for data (Negash and Gray, 2008).
It is also very important to be aware of the distinction that is present between data and information. In this context, it can be described as the raw facts and statistics. On the other hand, information can be described as it that is accurate and timely as well as it is specific and organized for a particular purpose. Such data is also presented in a context that provides its relevance and meaning. Therefore information may result in an increase in understanding and at the same time it can help in decreasing uncertainty. There is another way of looking at information. According to this view, information can be described as the data that has been integrated and presented in a particular context. In this way, information allows businesses to make their own decisions (Chang and Ramachandran, 2016).
The Significance of Information in Business
The significance of information lies in the fact that it allows organizations to make informed decisions as it presents the available data in a manner that it possible to interpret the data by the management. In this regard, the information related to customers is going to be proven to be useful for providing the metrics related to customer engagement for deciding the better ways of engaging or working with the clients. But in this regard, it also needs to be mentioned that the value or significance of information is present not only in the information itself but also in the actions that are the result of such information. For instance, if the information has alerted the organization regarding poor customer satisfaction, it is going to be useful only if such information has resulted in creating a change in the way such annihilation is dealing with its customers. Therefore, it becomes significant that the process of information could become a part of wider review process present in the organization for achieving the best outcomes (Kiem, Kohlhammer, Ellis, 2010).
Therefore in the case of nearly all industries, a person is almost certainly going to deal with the story related with the way data is changing the face of the business world. For example, it can be part of the study that has helped in curing a particular disease or increasing the revenue of a particular company. Therefore, generally speaking, data is also another name for information. However, in the business world, dumb data is used for information that can be read by machines as compared to information that is human-readable (Mohanty, Jagadeesh and Srivatsa, 2013).
Business Data: Types and Categories
Business data: There are several different directions in which the information flows in and out of the business. The nature of data collected by a business is informed by the objectives of the business. It is possible for computing systems to collect a large amount of data. Therefore it becomes important for the businesses to decide what type of data is going to be required by them for informing the decisions made by them and then to decide where and how such data is going to be collected. The type of data that may be collected by the business organizations can be described into five general categories. These are business processes, biological data, personal data, public data and physical world observations (Newman, Chang, Walters and Wills, 2016).
Conclusion:
Therefore it needs to be mentioned in the end that data and information represent everything, including facts, numbers and instructions that can help the organization in understanding something or making a decision. In context of business environment, data can be described as any information which includes the process ranging from production to consumption and acts as archive or record and is helpful in taking major decisions for achieving better results for the organization like increasing the efficiency of production or achieving higher revenue.
Hence the presence of data can drive the decisions made by the organization and its concerns related with planning and marketing. If the right set of data is available to the organization, it becomes easy for the organization to decide how it is going to channel its products and promote them to the target consumers. Such action is going to result in cost efficiency in case of marketing strategy. As it allows the targeting of exact market, it becomes highly probable that the market will consume the product offered by the company. At the same time, the relevant data also has the organization in finding out the needs of the consumers.
References
Newman, R., Chang, V., Walters, R. J., & Wills, G. B. (2016). Model and experimental development for Business Data Science. International Journal of Information Management,36(4), 607-617.
Mohanty, S., Jagadeesh, M., & Srivatsa, H. (2013). Big data imperatives: Enterprise big data warehouse, BI implementations and analytics.
Kiem, D.; Kohlhammer, J.; Ellis, G. (2010) Mastering the Information Age: Solving Problems with Visual Analytics,Eurographics Association
Chang , V. &Ramachandran, M. (2016). Towards achieving Data Security with the Cloud Computing Adoption Framework.IEEE Transactions on Services Computing 9(1), 138-151
Negash, S., & Gray, P. (2008). Business intelligence. In F. Burstein & C. W. Holsapple (Eds.), Handbook on decision support systems 2(pp. 175-193). Berlin, Heidelberg: Springer
Schutt, R., & O'Neil, C. (2013). Doing data science: Straight talk from the frontline. O'Reilly Media, Inc.
Davenport, T. H., & Harris, J. G. (2007). Competing on analytics: The new science of winning. Boston, Mass: Harvard Business School Press.
Mayer-Scho?nberger, V., & Cukier, K. (2013). Big data: A revolution that will transform how we live, work and think. London: John Murray
Sriram, R. S. (2008). Business intelligence in context of global environment. Journal of global information technology management, 11(2), 1
