It's official: SMEs trust their gut over data when it comes to making business decisions.
Ninety-one per cent of SMEs across the UK rely on experience rather than reporting tools, new research from SAP shows.
The number one factor associated with making decisions is gut instinct – see the below infographic for more details:
The survey, which gathered opinions from more than 500 bosses, shows that 75 per cent of all respondents are very confident in their decisions, despite only 23 per cent making instant decisions.
It is worrying that only ten per cent of respondents associate business decisions with hard data. Currently, less than a third of SMEs using reporting tools (i.e. sales forecasting, financial, business analytics or business intelligence) when making a business decision.
How can businesses use data to improve their decisions? SAP suggests:
Be a better boss: Are you judging employees fairly? Do you know exactly which areas of your business will benefit from a new hire and will they help your business to grow? Do you understand the real reason behind the performance of particular employees? Analysing data will lead you to make fairer, more informed decisions, ultimately leading you to be a better manager.
Improve your problem solving: Uncover new ways of looking at the problem. Insight into business data can help you decide what to change and how to change it, in ways you might not have previously considered.
You can be just as innovative as the big boys: Understanding data is one thing, having the technology to use it is another. Ensuring you work with the information your business reveals will lead to more innovative ways of thinking, enabling you to keep up with/ahead of the competition. There are affordable tech-investment options available for smaller businesses with big ambitions.
Moving beyond traditional data sets: Small businesses can now take advantage of unstructured data, i.e. information gathered from social networks, to gain more insight into customer behaviour.
Do you trust your gut for making business decisions? Or do you rely on hard data?