Why you should invest in your company’s data capabilities
Most companies want to be data-driven and benefit from reporting, analysis, and AI improvements. To achieve these benefits, you have to make the necessary investments in the foundation. These investments are primarily creating a centralized data warehouse and hiring data engineer(s) to support your analysts. When determining whether you want to invest in data capabilities, you need to ask yourself three questions: Who, What, and When.
The Who
Who does your company go to when you want analysis?
Who does your company trust to give you accurate reporting?
If you ask your company's leaders these questions and get different answers, you are most likely getting different results. Different results for the same question can be a severe problem when these results drive your decisions. When you don't have a solid data foundation, the analysts giving you information to drive your choices are reaching for their comfort areas and trying to get data to support their theories. Most likely, they are pulling data from sources that are similar to each other but not normalized. Normalizing your data makes connecting different sources more reliable. This can help you realize a tremendous increase in accuracy and help ensure your analysts are aligned. How often have different departments tried to solve the CEO's questions and had suggestions supported by radically different data? When you have too many "go-to" people, you essentially have no go-to person.
By investing in a centralized data warehouse where data engineers have cleaned and normalized the data and created structured reporting tables, anyone can pull data to analyze and be aligned. This investment ensures that when company leaders work with their analysts and come back to the CEO with recommendations, the recommendations may differ, but the supporting analysis is the same.
The What
What is the data source your company is using?
Excel still serves so many companies as their database of choice. Excel is an excellent tool and can solve many company needs, but serving as a database is a dangerous place to be. Between version control, chances of corruption, and performance issues, using Excel sheets with dozens of vlookups to other Excel sheets is a path to lost efficiency. When an analyst wants to work with the store EBITDA, but another analyst is already in the file, they must contact each other, save a copy, and begin working again. Loss of efficiency compounds this way. When you have a central data warehouse, analysts can connect Excel documents or report-building applications like Power BI and Tableau to the data and get the most up-to-date information without preventing others from working. Even problems that seem mundane can become an issue without normalized data. Mistakes can happen if your company works off a fiscal calendar and you have individuals building make-shift calendars. Having tables with validated data that are easy to join in your analysis minimizes human error.
The When
When do you need answers when you ask questions?
Putting your data in a central data warehouse, such as Microsoft Azure or Amazon S3 cloud data, allows your analysts to sprint where they were walking before. Views of the data can be created to allow end users to pull data quickly. Even with Excel, you can connect your report directly to a data warehouse and refresh the data as often as the data refreshes. These views allow for a speedy turnaround on requests now that your analysts don't have to copy/paste data from different sources or create new vlookups to join a new data source.
The growth in efficiency is a time saver, which in turn is true ROI in your investment into a data platform. Even getting new data becomes more effortless. As you move into the data world, you will hear about APIs, which are ways to get data from other sources quickly. All the documents shared with you can be automated into your data warehouse instead of having them emailed and saved on shared drives. This automation allows for a more incredible velocity of data coming in in a manner that will save you time in the long run!
This all leads to The Why!
Your company relies on correct and timely analytical support to allow you to pivot when something isn't working or inform you to dive in when something is working. By investing in a data platform and making a few key hires to support, you can see tremendous ROI for your efforts. Many companies see data platforms and teams as cost centers, but if done right, they are genuinely profit centers that will save you time and money by giving you the opportunity for accurate and fast analytics
