While it is possible you calculate all of your analytics by hand with a pencil and paper, most of us use modern software tools to collect, process and visualize our business data. The tools available today to understand your business are vastly more sophisticated than even just a few years ago, empowering us to use data in new and interesting ways.
The generation of insights from business data using these tools does not appear via magic. They are the result of a multi-stage process that starts with the raw data about events in your business and culminates with insights you can use to make decisions. I think about this as a value chain:
Each step in this chain is getting you one step closer to the insights you need:
- Collection: Gathering the raw data about what is happening.
- Storage: Storing the raw data for future analysis.
- Visualization: Viewing metrics based on the raw data.
- Analysis: Extracting insights from your metrics.
Choosing analytics tools can be a complex process because of the vast number of options in the market. Some of the best tools are free, so there is no guarantee that paying more will ensure you are getting the best. Selecting across these options can be one of the hardest vendor selections you make for your business.
We will drill into each of these in the coming days, focusing on what to look for when selecting tools for each stage.
Tomorrow we’ll get started by covering the different types of tools in the market.
Quote of the Day: “The odds of going to the store for a loaf of bread and coming out with only a loaf of bread are three billion to one.” ― Erma Bombeck