The world is a complicated place, and though it may seem that our lives have become more complex in recent years, that may not necessarily be true. What has changed, however, is how we perceive it. We are constantly bombarded by information about the world around us, and without any structured framework to compartmentalize and organize that information, the world can be very overwhelming to experience. However, if we manage to weather this storm of information, select what we need, weed out what we don’t want, and sort what we have, the grand picture of the world just falls into place, and we can examine it in all its glory.

The world of business is no different. Hidden somewhere in the endless ocean of noise is the information a business can use to navigate the waters. Imagine being stranded in the deep waters, pitch-black sky, no idea where the land is, what the weather will be like, or what’s lurking underneath the deep waters. Scary thought, isn’t it? You see nothing, you don’t know where you are or where you’re going, and what’s worse is you don’t know what’s waiting for you there. But if you could see the waters, see the skies, know the currents, and have a robust vessel to take you where you need to go, your nightmare can easily turn into an exciting adventure. That’s the power of information.

That’s what data reporting is about. It’s about helping you see what’s going on in and around your business, show how some variables affect others, figure out what works and what doesn’t, and help you decide where to lay a course. The information is there: in every transaction, every purchase, and every decision. The tricky part is to extract it from the data available and make it work for you.

Having a solid framework for recording, processing, and projecting data in a meaningful way can help management organize the structure of their business, as it provides several very important advantages:

Measuring performance

In its simplest form, data reporting allows us to measure key performance indicators (KPIs). That alone lets us gain insight into how well our company is doing in the areas that matter the most to us, be it sales, distribution, employee retention, accident prevention etc.

Comparing values

Data reporting helps compare sales across various products, productivity among workers, gains and losses throughout time periods.

Optimizing operations

With timely and accurate reports, we can schedule and organize our operations in a way that capitalizes on the market opportunities and mitigates the inefficiencies.

Creating derivative values

Oftentimes, compound factors can be created and measured to add more context to the values that are being monitored (Ex: growth in sales).

However, implementing such measures can be a rather tedious task, not without its caveats. Without going into technical details, there are a few challenges when it comes to analyzing and reporting data:

It starts with the way that data is recorded. Every typo, every mistake, every omitted detail or deviation from the correct format can lower the integrity of the data.

Storing the data and retrieving it on demand requires expensive equipment, a lot of developing, and heavy testing that most companies are not equipped for. In that case, it may be beneficial to outsource data reporting to third-party companies.

Reading and interpreting the data requires one to understand what to look for, so reports may have to be customized based on the target audience and their level of understanding when it comes to the information that is being reported.

But even with those challenges, the alternative is not worth the risk. Floating aimlessly, hoping for a current to pick us up and take us where we would like to go is a very hopeful, albeit reckless, way of conducting business because let’s face it…it is much more exciting to set the course, hoist the sails, and let the wind take you where you want to go.