You Don't Know It Yet, But You Have A Data Problem

If you are reading this and you own or work for a business, you have a data problem!

“Ok, I think you’re suffering from hammeritus. You are a hammer, so you think everything is a nail.” … Yes, you might be right, but hear me out first!

I get asked all the time, “You’re the Data Dude, but what do you mean by ‘data’?” to which I respond, “Well, what do you think of when I talk about your ‘business data’?” To which they will say:

• Customer names and emails
• Their website
• Their spreadsheets
• Their Customer Relationship Management (CRM) tool
• Their financial data (Income and Balance Sheet)
• Etc.

Each and every last one of these answers is correct. DATA IS INFORMATION. It comes in lots of different forms.

• Words and letters are data
• Numbers are data
• Drawings and images are data
• Sound is data

Your 5 senses are all designed strictly to collect data/information about your environment. So literally everything you see, touch, taste, smell, or hear is ALL DATA.

“Even if we assume we have the same definition here, that doesn’t necessarily mean we have a data problem, though.” … yes, it does, and here’s why: If you had all the data and it was 100% accurate, you would know exactly what to do in every moment and situation in all space and time.

The only being I’ve ever heard described as having an accurate knowledge of all information past, present, and future is God. Now, this isn’t meant to be a theological discussion, but the fact that you are reading this right now on this site, means you’re not God (unless, you are the one and only God, in which case, “Have mercy on me and don’t strike me down for this” 👼); therefore, you MUST be suffering from at least one of two conditions:

1. A lack of ALL data
2. A corruption of data (e.g., lies, false information, bad data, etc.)

Ok, let’s ground this back to business.

If you have ever gotten to a situation where you are unsure of what decision to make in your business, then you have a data problem. You either don’t see either your current or future situation clearly, or you don’t have well-defined goals.  Either way, fix the data to fix your problem.

Stated another way, with clearly defined goals and enough high-quality data, any decision becomes obvious.

A corollary to all of this would be that there’s no decision in business that can’t be made easier, quicker, or more effectively with more volume or more accurate data and systems that can handle that data correctly.

So, you see, I don’t have to guess whether or not you have data issues in your business. The more important question is WHICH DATA PROBLEM DO YOU HAVE? I would break all data problems into one of 3 categories:

1. Quantity
2. Quality
3. Decision Making

Quantity Data Problems

Problems with the quantity of data mean you are not actually collecting the data you need. Sometimes, you are collecting the data you need, but you don’t realize it. That’s actually a decision-making problem; we’ll get to that later.

Every business has at least two datasets, or it’s not a business:

1. Financial Data: information on the financial health of your business (e.g., Profit and Loss Statements and Balance Sheets). This data can be found by talking to your accountant and/or bookkeeper. If you don’t have an accountant or bookkeeper, then you DEFINITELY have a data QUANTITY problem here.
2. Customer Data: This is the list of every customer you are currently serving and have served in the past. This would at least include names and contact information, but should include much more. Worst case scenario, this information is in your phone or email, but if that’s where your customer info is, then you DEFINITELY have a data QUALITY problem here.

Most businesses also have or should have the following

3. Marketing Data: Information about potential future customers who are becoming aware of you and considering purchasing your product or service.
4. Operational Data: Information about your operations, like what happens when you’re onboarding or offboarding your customers. Information on your suppliers and whether they are changing their prices. This is a very broad category and looks very different for each business
5. Product/Service Data: Information on the utilization of your products and services, as well as their customer satisfaction. This is a larger and easier thing to collect for SaaS products because it’s all captured digitally, but even service-based businesses will want to know how long it took to deliver and fulfill their service and what people are saying about it.

Quality Data Problems

Problems with quality include any type of trustworthiness issues:

• The data is incorrect
• The data doesn’t actually represent reality
• The data has gaps
• Etc.

Just KNOWING that your data is poor quality is immediately actionable intelligence–go fix your data!

Decision-Making Problems

Decision-making problems usually stem from a lack of literacy about the data. If your personnel or your AI don’t understand that a dip in your website traffic for a week means there’s a problem they need to investigate, then you’re people or your AI are not properly trained. They need to know what actions the data should prompt them to take based on the situation at hand.

The Flywheel of Intelligence

If you solve all 3 of these problems for even a sliver of one of the 5 types of business data, you are going to be impacting your bottom line positively. This is how you make intelligent business decisions. 

1. You collect the data
2. You extract the useful information from the noise
3. You look at the trustworthy data to understand/diagnose an issue 
4. You predict that a particular set of movements in a particular set of levers will produce the desired effect and act accordingly
5. You measure the impact of your changes (This is step 1 all over again).
6. Rinse and repeat. 

This is a flywheel. Flywheels are what successful businesses are built on.

So, after understanding all this, are you still going to claim that you don’t have a data problem?