You know how important data analytics is to your company’s success. From predicting the success of future campaigns to seeing what’s not working, every company uses data to make better decisions. And while that might seem straightforward, we have bad news: it’s not! Using data to make smart decisions can be challenging, especially for those who haven’t had to depend on data in the past.
If this resonates with you, you’re in the right place! In this article, we’ll cover some of the crucial things to keep in mind when running a data analysis, common challenges you’ll come across, and, of course, some helpful tips and tricks to help you overcome them. Ready?! Let’s go.
Data Analytics: a Quick Summary
Before we dive into the challenges you’ll face when working in data analytics, we should quickly define data analytics, why it’s useful, and its common applications.
Data analytics is the process of turning raw information into actionable insights, drawing conclusions and insights from various sources to make better decisions. The benefits of data analytics are numerous, but let’s cover a few:
Better decision making: we mentioned this one from the very beginning; looking at past results and future predictions can guide your decision-making process, making it more effective. Data analytics tools, which are capable of handling much more data than humans can, can also help identify trends and patterns that maybe weren’t visible to the human eye.
Personalized customer experiences: clients want to feel special and want to feel like their voice is heard, even though they’re just one shopper in a group of thousands. Companies that use data to analyze customer behavior can both suggest similar products or services to their customers and find out what they are interested in, ensuring they remain clients and return to the website/store.
Higher efficiency: data isn’t just used for decision making about the future; it can also be used to find mistakes that were made in the past and identify why they occurred. In addition, it can use past data to highlight problem areas and suggest improvements.
Enhanced security: part of using data is ensuring that this valuable information is properly stored and protected. Data analysis tools can help you identify vulnerabilities in your network and predict future problems so that you’re able to get ahead of them.
As you now know, data analysis is a crucial part of any company’s business processes. But how is data analytics actually used in the day-to-day of companies? Below we’ve highlighted four sectors where data analytics has transformed the industry’s overall functionality, providing valuable insights to leaders.
Applications of data analytics
Data is used in every sector, but here are four where its impact has been (and will continue to be!) monumental:
Transportation: have you ever wondered how the maps app on your phone continuously updates, telling you how to avoid roadblocks or traffic jams? Well, it’s because of data! Your phone receives real-time information about the state of the roads (data!) and analyzes it to suggest the best possible route for you.
Advertising: no, your phone isn’t listening to you. It may seem impossible that Amazon always knows what you want to search for, but it’s purely data! Through collecting data about what you’re searching for and others have searched for when buying similar items, websites are able to provide you with incredibly personalized experiences to enhance the customer experience.
Security: businesses receive lots of data these days and things can fall through the cracks. Security, however, is an aspect of business that cannot be ignored; data analytics tools can help improve security, finding areas to keep an eye on or flagging troubling patterns in the data.
Marketing: one of the first steps that companies need to take when creating their product or service is deciding who their ideal customer is; through collected data, companies can learn more about their clientele, such as their gender, age, race, or socioeconomic status, which can help them provide a more personalized customer experience.
Now that we’ve properly outlined data analytics and why it’s so important, let’s dive right into challenges you could face–and solutions, of course.
Challenges in Data Analytics
Especially as they get used to working with data, companies can face significant challenges when it comes to using data analytics properly. After all, with such large amounts of data, there’s a lot to handle. Let’s discuss five of the biggest challenges facing data analysts and give you some tips to overcome them.
Thinking data has all the answers
We know you’ve heard us talk about data and how valuable it is; you may think it’s almost magical. And while it can certainly provide incredible insights to your company, it’s not all-knowing and only properly trained data professionals truly know how to make the most of it. A large part of successful data analytics is knowing how to sort and categorize data so that you’re able to draw the conclusions you actually need.
Ironhack’s tip: before you even begin your analysis, have a clear understanding of what you’re trying to accomplish. Then break the data down into smaller areas that will help you get the insights you’re after. Trying to look at the data all at once is impossible and won’t bring you to any truly helpful conclusions.
Trusting data analytics with just anyone
How hard can reading a few graphs be anyways?! Well, quite difficult, actually. Data analytics should be entrusted exclusively to data professionals who have experience in all sorts of analysis and can help work through the large amounts of data to find what really matters.
Ironhack’s tip: if you don’t have anyone at your company who can run data analysis properly, it’s best to outsource to a true data professional, or look to up or reskill current employees through bootcamps or online courses. It’s an investment, but one that will positively benefit your company in the future.
Struggling with data visualization
Your data professionals have gone through the data and claim to have insights, but when you take a look, it doesn’t make any sense. Or you’re trying to make a point to your higher-ups or another team and they’re just not understanding what you’re trying to communicate. Here is where data visualization comes into play; your conclusions are useless if others can’t understand them.
Ironhack’s tip: commit to finding the right data visualization tools for you and your company, educating your team on how to use them, and ensuring that the data is properly displayed. It may take up some time now, but your future insights will be better understood and implemented.
Collecting low quality data
Insights from data are valuable–as long as that data is accurate. When it comes to low quality data, which could be incomplete or inaccurate, it can seriously affect your final decisions and lead to problems. Little mistakes or problems seem minor when looking at just one part of the data, but when combined with other errors, can lead to completely skewed data.
Ironhack’s tip: lots of mistakes and errors come from manual human work. Automating tasks such as data entry or using tools to find any missing information can both free up your time and ensure that human mistakes are eliminated. There are tons of data softwares and solutions out there that are designed to facilitate your data entry process, flagging any possible errors.
Trying to communicate the importance of data
There’s nothing worse than trying to talk to someone who just won’t listen. And unfortunately, there are lots of people out there who negate the power of data, and especially when it goes against long-established practices. One of the biggest challenges that data professionals face is trying to instill the same respect for and dependence on data that they have to other departments or even company leaders.
Ironhack’s tip: find out what’s important to your colleagues and show them how using data will benefit their specific needs. Once you’ve convinced them that it will help with what matters most to them, you’ll be able to slowly show them how data works in other areas.
We could go on and on–after all, data is such an important part of everything we do. But we don’t want to bore you! If you’re interested in harnessing the power of data and improving business processes, your future may lie in data analytics. Luckily for you, Ironhack’s Data Analytics Bootcamp teaches everything you need to succeed. Interested? Check it out below.