Session 22:

 Data Driven Decisions

Data-driven decision-making is an approach that emphasizes using data and analysis. It involves data
sources as customer feedback, market trends, and financial data to guide decision-making processes.

Data-Driven Decision-Making Examples

Different types of businesses use data for targeted marketing, inventory management, personalized
recommendations, and preventing customer churn:
[1] Amazon: Uses data to segment customers based on location, demographics, and buying

behaviours to build targeted marketing campaigns.

[2] Walmart: Uses historical data and predictive analytics to strategically place holiday items across

stores, optimizing the entire shopping experience.

[3] Netflix: Uses data for customized suggestions, minimizing customer churn and boosting

retention rates.
A. Data-Driven Decision-Making in Education
Educational institutions use data for analysis to gauge performance, catch warning signs of failing
students, and develop curriculum:
 Purdue University: Uses a predictive analytics tool called Course Signals to monitor
performance and predict students at risk of not successfully completing a course.
  Demand of University: Uses data analytics to make sure course offerings match student
demand.
B. Data-Driven Decision-Making in Healthcare
Healthcare organizations use data to refine patient care, prevent diseases, and conduct research:
 Cleveland Clinic: Leverages data to examine the impact of factors outside of the health
system on a patient’s health. It also uses analytics to identify patients that would recover
successfully at home following surgery.
 Centers for Disease Control and Prevention (CDC): Uses data to build informed decisions
and establish systems for emergency operations and response.
 The Broad Institute: Uses big data analytics to advance drug discovery.
Benefits of Data-Driven Decision-Making
Businesses can transform their operations and position themselves for long-term success by
adopting a data-driven decision-making model, improving the experience for their customers
and cutting-costs in the process.
 Improved Customer Experience
Data-driven enterprises are more customer-focused and gain a deeper understanding of
customer journeys. It helps you tailor your business offerings, improve services, and address
customer issues effectively. This leads to personalized experiences, stronger customer
relationships, and higher revenue.

 Better Strategic Planning

By using data to inform our choices, we can set achievable goals and stay ahead of the
competition. By creating a common understanding across departments, supporting
communication, and encouraging a shared commitment to achieving organizational goals.

 Growth Opportunities
it enables you to identify new business opportunities and areas for improvement. It helps
uncover trends and patterns for spotting new market opportunities. It also lets your business
swiftly uncover bottlenecks and areas you need to work on.

 Increased Operational Efficiency and Optimized Costs

Relying on data can uncover productivity bottlenecks and optimize resource use, resulting in
better business efficiency. Furthermore, it facilitates accurate demand forecasting, leading
to significant cost savings.

 More Accurate Forecasting

Since data-driven decisions allow for more accurate forecasts and predictions about the
future, it brings about more efficient operations and cost reductions.
Common Challenges and Misconceptions about Data-Driven Decision-Making

Businesses in many industries turn to data-driven decision-making for precision and efficiency.

Neglecting Data Quality

Poor data quality can lead to inaccurate and unreliable insights, resulting in flawed decision-making.
Good data management practices involve ensuring the quality of the data

Scattered Data

Disorganized data scattered across different departments are like pieces of a puzzle that just won’t fit
together. It makes collaboration difficult and decisions end up being all over the place.

Data Illiteracy

Data illiteracy can lead to ineffective communication between data professionals and non-technical
stakeholders. It can also hinder the successful implementation of a data-driven culture.

Historical Data Overreliance

Relying too much on the past can also be a stumbling block. It’s like assuming last year’s fashion
trends will always be in style—markets change, trends evolve, and decisions based solely on
historical data might miss what’s currently happening.

Confirmation Bias

Decision-makers may selectively focus on evidence that confirms their expectations, leading to
skewed interpretations and reinforcing existing biases.

Poor Communication of Data Insights

Even with accurate data, there can be a breakdown in communication between data analysts and
decision-makers, leading to misunderstandings.

Tools are Used for Data-Driven Decision-Making?

 Business intelligence (BI) Tools for data visualization and interactive reporting allow you to
create dashboards and analyse data trends.
  Big data platforms handle and process massive volumes of structured and unstructured data
for enterprises dealing with large datasets and complex data analytics tasks.
 Data governance and quality tools ensure data quality, security, and compliance, so your
organization can establish and enforce data management policies.
 Enterprise Data Management

Enterprise Data Management (EDM) is a comprehensive approach to defining, integrating, and

retrieving data in an organization. This strategic data management practice allows businesses to
effectively manage and utilize their data as an enterprise asset by ensuring its accuracy, consistency,
and security.

EDM typically includes elements like data governance, quality, integration, privacy, master data
management, and lifecycle management.

Why Is Enterprise Data Management Important?

Enterprise Data Management (EDM) is essential for several reasons:

 Improved Decision Making: High-quality and well-managed data allows for accurate insights and
intelligence, leading to more informed decisions.
 Data Consistency: EDM ensures that everyone within the organization works with the same
information, reducing inconsistencies and enhancing collaboration. This is especially crucial in
large organizations with numerous departments working in silos.
 Regulatory Compliance: Various industries must comply with strict regulatory requirements
related to data and enterprise digital rights management. EDM helps maintain such compliance,
avoiding hefty fines and legal repercussions.
 Enhanced Data Security: With increasing cybersecurity threats, EDM is vital in securing a
company's data assets reducing the risk of breaches and losses.
 Increased Efficiency and Productivity: With better data access and management, organizations
can streamline their processes, improving efficiency and productivity.
 Cost Savings: By avoiding data-related errors and improving operational efficiency, companies
can save costs in the long run.
 Customer Satisfaction: Accurate and well-managed data contribute to a better understanding of
customers' needs, improving experiences and ultimately leading to higher customer satisfaction
and loyalty.
 Competitive Advantage: Companies that manage their data effectively can extract valuable
insights and identify trends and opportunities, leading to a competitive advantage.
What Are the Pillars of Enterprise Data Management?

The pillars of EDM define the key areas that need to be addressed to successfully implement EDM,
such as the following:
  Data Governance: This refers to the overall management of the availability, usability,
integrity, and security of data in an organization. It includes establishing policies, procedures,
and structures to manage data effectively.

 Data Quality: This ensures the completeness, consistency, accuracy, relevance, and
timeliness of data. Data quality can lead to accurate analytics, efficient operations, and
correct decision-making.

 Master Data Management (MDM): MDM involves establishing a single view of all critical
data during the data's lifecycle. It ensures that an organization does not use multiple,
inconsistent versions of the same data in different processes.

 Data Integration: This involves combining data residing in different formats or sources and
providing a unified view of them. It enables the efficient sharing of information across
various departments in a company.

 Data Security: This involves protecting data from unauthorized access to maintain
confidentiality and privacy and to ensure regulatory compliance. Data security includes
encryption, access controls, and secure data storage and backup.

 Data Privacy: This pertains to the proper handling of data regarding consent, notice, and
regulatory obligations. It's about ensuring the data collected is legally, fairly obtained, and
protected from misuse.

 Data Architecture: This is the design of data and systems, defining how data is collected,
stored, transformed, distributed, and consumed.

These pillars are interdependent and must be effectively managed to realize the full benefits of EDM.

What are the Benefits of Enterprise Data Management?

 Improved Decision Making: EDM provides businesses with accurate and high-quality data,
which is integral for making informed decisions.

 Enhanced Data Quality: EDM ensures that the data used is clean and reliable, reducing data
irregularities and inconsistencies.

 Increased Efficiency: By centralizing and streamlining data, businesses can save significant
time by making it faster and easier to locate and utilize data.

 Regulatory Compliance: EDM ensures that an organization's data complies with relevant
laws and regulations, reducing the risk of fines and sanctions.

 Data Security: EDM also encompasses data and file security management, minimizing the
risk of data breaches and cyber-attacks.

 Greater Collaboration: Data centralization makes sharing and use across departments easier,
enhancing collaboration and coherence.

 Reduced Costs: Businesses can save data storage and management costs by eliminating
redundant data and streamlining data management processes.

 Enhanced Customer Service: A unified view of customer data improves customer service and
personalization.
 Standardization: EDM ensures that all data adheres to a standard set of formats, improving
interdepartmental communication and understanding.

 Risk Management: EDM allows businesses to manage and mitigate data accuracy and
reliability risks effectively.

o Data Preparation and Data Cleaning

Data preparation is the process of cleaning and transforming raw data prior to processing and
analysis.

Benefits of data preparation: Data preparation helps:

 Fix errors quickly — Data preparation helps catch errors before processing. After data has
been removed from its original source, these errors become more difficult to understand and
correct.

 Produce top-quality data — Cleaning and reformatting datasets ensures that all data used in
analysis will be of high quality.

 Make better business decisions — Higher-quality data that can be processed and analyzed
more quickly and efficiently leads to more timely, efficient, better-quality business decisions.

Data preparation steps

1. Gather data: The data preparation process begins with finding the right data.

2. Discover and assess data: After collecting the data, it is important to discover each dataset.

3. Cleaning the data and validate data: cleaning up the data is traditionally the most time-
consuming part of the data preparation process, but it’s crucial for removing faulty data and
filling in gaps. Important tasks here include:

 Removing extraneous data and outliers

 Filling in missing values
 Conforming data to a standardized pattern
 Masking private or sensitive data entries

4. Transform and enrich data: Data transformation is the process of updating the format or value
entries in order to reach a well-defined outcome, or to make the data more easily understood by
a wider audience.

5. Store data: Once prepared, the data can be stored or channelled into a third-party application
such as a business intelligence tool.