Insight Over Information
Today, data is a commodity that is more sought after than ever with 68% of businesses investing in data analyst and data science capabilities globally. Every business is investing in this area with the same goal in mind, to help leaders and executives make more informed decisions. But much like being able to write code, speak in front of an audience, or even being able to paint, researching and collecting data is a skill. But what’s even more of a skill is the art of gathering that data, turning it into information and eventually moulding that into something that can be used to make decisions for a business... Otherwise known as the skill of creating insights.
But what is an insight, and what is the process of turning raw data into something that becomes so valuable that it changes the way we think, make decisions and carry out our everyday lives?
The evolution of information
Raw data is the purest form of information that is available. Think rows of numbers in an excel sheet or a csv file. It’s also the most valuable commodity in the world, with its value outperforming the likes of gold and oil the past few years. And the reason it’s so wildly valuable is it’s used to make decisions from where and who to advertise too, to what decisions a government should make when deciding on key policy decisions.
The best way to think of data is like wood. Much like wood, data is everywhere and all around us and is largely free and accessible - if you go on any government or social website you can download a variety of datasets on a range of topics about spending, population, and consumer behaviour to name a few. But much like when you use wood from a forest and build a house, the real value of data comes when you shape it into something. The real value of data is when you shape it into information and eventually insight. Before that process, it is just like any other raw commodity available to purchase globally in our economy today.
Turning data into information
What traditional research, data science and digital firms do when they receive datasets that are thousands of rows in length is they turn it into information. There are a number of ways this is done, with the most common being called data visualisation. They turn the numbers into graphs, charts and infographics that go in dashboards and reports with the goal of one thing - making sense out of data and turning it into information. But there's one fundamental problem with stopping at this juncture, information doesn’t give any insight. Information relies on the reader (who is usually a CEO, COO, or CMO) to have a deep understanding of statistics, and relies on them being able to interpret what is in front of them and turn it into insight. Information is essentially like building the frame of a house from wood, then giving it to the homeowner to finish. The bones are there, but not anything that is useful to the purchaser or that can be lived in.
Turning information into insight
Firstly, it’s important to know what an insight is. The technical term is to gain a deep understanding of something. In practice that means taking information, and making it relevant to your business or organisation. For example, once you have created information from data, what does this mean for your business? The hard thing about creating insights is that it takes context and a deep understanding of the industry and business you are operating in. It’s extremely hard for suppliers and firms to deliver insight as you need to partner with a client, spend time with them which ultimately becomes expensive and inefficient.
However, as inefficient as it can be, it is also where true value and change is created. If businesses nail the craft of being insightful, generally growth speeds and decisions become more efficient and effective at a pace that far outweighs the cost of gathering insights in the first instance.
Turning insight into action
Once you create an insight for a business, the question is then what next? What actions should you take off the learnings you have gathered? Most people do not get to this part of the equation. They don’t get here because at this juncture it moves from research to consulting, this is where you put ‘skin in the game’ and explain what the next steps are and why you have chosen these next steps. This is called an ‘actionable insight’. An actionable insight explains what the information you gathered means for the business, and what actions you should take off the back of it. This is the final step of turning data into value. This is where you get a raw commodity like wood, and build a final house with it.
Summary
In Summary, everyone has access to data, much like they have access to most commodities. It is what you do with that data that makes it valuable much like taking wood and building it into a house therefore turning data into real value. Adopting insightful behaviour is crucial for increasing growth and improving efficiencies to make smarter business decisions.
