3 Ways to Use Data-Driven Decision-Making to Your Advantage

Data-driven decision-making is more reliable than making decisions based on gut reactions. Intuition can only offer an idea of a solution or direction for an organisation, without much justification. Instead, data should fully inform a decision. This is because data helps organisations to verify, understand, and quantify the important factors connected to your organisation. This data exists both internally and externally.

According to a study by PWC of more than 1000 senior executives, highly data-driven organisations are three times more likely to report significant improvements in decision-making compared to those who rely less on data.

As a result, data-driven decision-making can offer a variety of positive benefits to an organisation.

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What is data-driven decision-making?

A common acronym for data-driven decision-making is DDDM. In simple terms, data-driven decision-making is the process of using data to inform your decision-making process and validate a course of action before committing to it. Examples include:

How this data is incorporated into the decision-making process depends on a variety of factors. This includes business goals, data quality, and the format of data available.

Benefits of data-driven decision-making

The opportunities for data collection are vast. This results in an array of data available to an organisation which offers a range of benefits for an organisation.

Proactive decisions

When a data-driven decision-making process is first implemented in an organisation, the process is likely to be reactionary. Teams will react accordingly when identifying trends in the data.

Once your team is more comfortable with data analysis in decision-making, this process becomes more proactive. Given enough practice, and the appropriate form and quantity of data are available, data can forecast and predict future events. For example, your organisation will be able to identify business opportunities before your competitors, giving your organisation a key competitive edge.

Cost savings

According to a survey of Fortune 1000 executives by NewVantage Partners, using data to decrease expenses was one of the most impactful initiatives when investing in data-driven processes. Of the organisations which began projects designed to decrease expenses, more than 49% saw value as a result.

Using data-driven decision-making can highlight cost-savings within your organisation. For example, underperforming products can be identified in comparison to others and have reached the end of their life.

Confident decision-making

Data helps benchmark current situations within your organisation. This allows your team to better understand the impact that any decision you make will have on your business. It is also logical, helping remove subjective elements from business decisions. This can inspire confidence in your decisions as a result of removing any emotional aspects and biases.

However, just because a decision has been reached through data analysis does not necessarily mean it is the most appropriate course of action. Data accuracy and quality is particularly important in creating a stable base for decisions; inaccurate data will inform inaccurate business decisions.

The impact of every business decision should be regularly measured and monitored to mitigate any potentially inaccurate decisions.

How to become more data-driven in decision-making

To enjoy the benefits of data-driven decision-making, organisations often need to adapt their operational processes. Small, simple changes to how teams approach tasks both in the workplace and in their downtime can build the foundation for incorporating data within organisational decisions.

Connect every decision with your data

Avoid relying on gut instinct or past behaviour when presented with a decision. Identify what data is available to inform your decision and do some research.

If no data exists to support or reject your decision, consider how it could be collected. For B2C organisations, for example, social media channels could be easily used to collect audience opinion data, such as through polls.

Connecting every decision with data provides more authority behind proposals and decisions than estimates and guesses. However, ensure new data is collected accurately rather than seeking an explicit answer. Going into research expecting to receive a particular answer can mean ignoring any results outside of this particular answer, or even collecting inaccurate data due to having a skewed approach.

Look for patterns everywhere

Finding connections and patterns is at the heart of data analysis. These patterns inform insights, which in turn inform decisions.

Being more analytical is the first step in becoming more data-driven, as it aids in identifying patterns. This is a practice that can extend beyond the workplace. For example, practice observing patterns in people’s habits when shopping. Is there an insight you can draw from this pattern?

Getting into the habit of identifying patterns and extrapolating insights helps teams to be more observant when it comes to data analysis. Stronger insights then inform stronger decisions.

Visualise the meaning behind your data

Data visualisation is crucial to the data analysis. Visual data is easier and more accessible for users to interpret data from, rather than having to pour through large amounts of written data.

Creating visuals in the form of charts and graphs allows users to quickly identify trends and make conclusions about data. Scatter graphs, for example, are a simple way to visualise positive and negative correlations between data points, thus informing insights.

It is important not to get too carried away when creating data visualisations. Too many visuals, or even too many colours, can detract from your data and create a confusing experience for your audience.


Whilst there are many benefits to data-driven decision-making, it is important to note that the process does not have to be all-or-nothing. Instead, introducing data-driven decision-making slowly into an organisation can create more positive outcomes through fostering a positive data culture for analysis.

Business intelligence solutions offer an easy solution to data-driven decision-making. Audiences can understand key data immediately through visualisations created by BI tools. BDI offers a range of BI solutions, complete with training for users and support following installation. If your organisation could benefit from introducing BI software, or if your organisation does not receive enough support from your current vendor, BDI is here to help

Our team would welcome the opportunity to consult your organisation and help you meet your business goals.

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