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What Does Data-Driven Mean?
Taking risks in business often pays off, but this does not mean that companies should pursue opportunities blindly. Enter the data-driven approach. What does data-driven mean? Data-driven describes a strategic process of leveraging insights from data to identify new business opportunities, better serve customers, grow sales, improve operations and more. It allows organizations to use evidence-based data to make decisions and plan carefully to pursue business objectives.
A data-driven decision is based on empirical evidence, enabling leaders to take informed actions that result in positive business outcomes. The opposite of a data-driven process is to make decisions based solely on speculation. For data-driven business leaders, listening to their gut may be part of their decision-making process, but they only take specific actions based on what the data reveals.
Business leaders in data-driven organizations understand the benefits of relying on data insights to make wise business moves. As MicroStrategy reports based on results from a McKinsey Global Institute study, data-driven businesses are 20-plus times more likely to acquire new customers and six times more likely to keep them. Those leaders, however, must be able to rely on knowledgeable data professionals and technology tools that can uncover the value in the data. Data professionals can also provide insights into the best ways to collect, store, analyze and protect valuable business data.
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