Four Common Examples of Internal Data
Internal data can benefit businesses that want to improve efficiency and productivity and businesses that are failing to generate a profit. External data is outside an organization’s control, such as economic trends and government regulations within an industry. Internal data, however, uses information from inside a company to help drive decision-making on key issues. There are four types of internal data that can provide business owners and leaders with the information necessary to implement new strategies.
Few departments of a business are more maligned than sales, and one reason is because it's so essential to a company’s profitability. Sales data can include revenue, profitability, distribution channels, price points, customer personas, and the gaps between what is being produced and what customers are buying. Sales data can help business owners understand areas of strength and areas of weakness, which may drive a shift in marketing or focus. For example, a skateboard company may discover that sales to customers over the age of 40 have increased over the past year. This information may trigger a marketing campaign aimed at a new demographic that wasn’t previously targeted.
A company’s finance department can generate valuable data such as production reports, cash-flow reports and budgets. Production reports detail the exact amounts spent to manufacture products and services. Cash-flow reports detail how much money was used within the company during a specified period of time. Budgets provide information about how money was spent relative to what was allocated. Companies that continue to blow through their budgets without a significant increase in sales are not likely to have success. Unlike sales, which provide information about the number of products or services sold, financial data reveals what a company is spending to make these products and services, and the variance in these costs. For example, a finance report can show that ordering certain supplies is cheaper in the summer. Shifting order cycles can slash those costs, and help boost profit margins.
An organization’s marketing department is focused on promoting products and services, building brand awareness, and properly targeting customers and prospects. Marketing departments are a treasure trove of data. They can generate reports on customer behavior, customer profiles, number of social media campaigns, level of brand awareness, level of market share relative to the competition, and level of engagement through website and content. Analyzing internal marketing data can help business owners decide which marketing campaigns are working, which ones need improvement and what type of new campaigns would be effective based on the needs of the target consumers.
Businesses can’t survive without a loyal and efficient workforce. Human resources can provide information regarding what it costs to recruit and train an employee, the productivity of an individual employee, how absenteeism is affecting work culture and the level of satisfaction or dissatisfaction employees feel about the company. A business can’t thrive if employees are unhappy, unproductive and unmotivated. Human resource data can reveal the areas where a company needs to improve its processes to make workers feel empowered and valued, and therefore more likely to buy in with their skills, talent and sweat equity.