A new report by RSM Australia highlights the importance of developing a business culture that values and seeks out data-driven insights so that SMEs are able to identify and prioritise strategic initiatives and new opportunities, in order to manage risk and strengthen their value proposition.
RSM Australia’s latest thinkBIG report, Leveraging data to unlock value in your business, also provides an outline as to why a data-led business culture is key for SMEs to make informed decisions rather than from hindsight.
“The post-pandemic business environment depends on data-led insights,” Srdjan Dragutinovic, director of data analytics at RSM Australia, said. “COVID-19 caused businesses to pivot quickly and rethink how they did things to ensure they could retain customers.
“It’s often said that it costs five times as much to acquire a new customer as it does to retain an existing one,” Dragutinovic added. “Customer retention is, and should be, a high priority for any type of business. For SMEs, knowing and understanding customers through data-led insights is essential to retaining customers and nurturing relationships.”
The RSM Australia report also reveals how a successful data-led culture focuses on collaboration driven by information sharing, with business leaders being committed to strategic alignment between the business, analytics strategy and culture. When done successfully, organisations can integrate analytics into all decisions to generate foresight on relevant trends that will ensure more successful business outcomes.
“The need for buy-in from business leaders when implementing a data-driven culture is crucial because, without that, little will change,” Dragutinovic said. “Leaders should focus on information sharing, not just collating data and analytics, to build a data capability that encourages use by everyone in the business and is relevant.”
According to the Harvard Business Review, the biggest challenge to creating data-based businesses isn’t technical but cultural, as such undertaking requires a shift in mindset so that data-led insights become normal and even automatic for employees. This starts with business owners and managers who must lead by example and focus on metrics that employees can use to solve a business problem.
“Culture change starts at the top. Business owners and managers should lead by example and set expectations that employees will focus on data-led insights in decision-making,” Dragutinovic espoused. “This must be supported by training and tools that empower employees to build a data-focused culture.”