When it comes to analytics, data exploration is an important part of the process. It can be tempting to execute projects that will help you explore business insights. However, it’s crucial to ensure you’re looking for outcomes that align with business goals. If your analytics exploration only gives you general insights, then it's time to focus on driving ROI from your efforts.
Insights vs. Outcomes
Both insights and outcomes come as a result of your analytics effort. Insights are information-focused findings and produce fact-based results like:
- We predict 40% of our customers who are contacted less than once a month will churn within 6 months.
- There is a strong inverse correlation between machine efficiency and line speed.
Outcomes are strategic and result from modifying the business process to include information gained from your insights. Results like:
- We had a 30% decrease in customer churn since we implemented our automated client contact system.
- Our machine efficiency has increased 5% since we decreased the line speed.
Insights provide detailed knowledge to support overall change. Outcomes happen when the strategic business processes and plan you've implemented create change and ROI.
Why Focus on Business Outcomes?
Insights are beneficial to your business, but it’s difficult to put a number on the return they provide. When you’re beginning your advanced analytics efforts it’s crucial to get ROI-generating quick wins to help your business gain momentum and adapt to the changes being made.
From there, it may make sense to move to more exploratory insights and additional initiatives without specific outcomes. However, these initiatives should always support the company's overall objectives and should only be done once you’ve developed a track record of ROI-generating projects.
What Outcomes Are Important to Track?
Outcomes add value that should be tracked throughout the project. Look at the areas that are delivering value to your organization and ensure those components are being documented.
When you focus on strategic value, your outcomes have ROI and your efforts can be justified. Some common ways your project can track ROI include reducing business expenses, increasing business revenue, driving team efficiency, and giving your business a competitive edge. By reporting these to executives, you can demonstrate the sales you’re driving or costs you're saving throughout the project.
It’s important to track outcomes over insights, especially at the beginning of your advanced analytics efforts. Whenever you implement a project, it’s crucial to determine and track those outcomes so you can effectively report them to executives and get approval for future projects.
Need help moving from an insights organization to an outcomes-based data analytics practice? Snow Fox Data provides services that are completely tailored to fit the needs of your business, no matter where you are on your analytics journey.
