How to Make Databases Work for You

Databases practically run our lives. I’m not saying it’s a bad thing; I’m just making the observation that every piece of information about us, and our businesses, is spread across countless databases. And they don’t just house data; they also sway most of our daily decisions.

What is a database?

A database is simply a place to store data. Anywhere you enter information, typically of a specific type, is a database. The most common example is email software, mostly commonly, Microsoft Outlook®, which stores our contact information, calendar information, and email messages. Other databases we use on a daily basis include customer relationship management (CRM), accounting, manufacturing and production bill of materials, and mailing lists, just to name a few.

Why are databases so important?

Because of the wealth of information they offer, and the many different ways in which we can retrieve the data. The ability to analyze the information allows us to make decisions that are persuaded by the information.

For example, in accounting, if we look at inventory levels we can determine what items do, and don’t, need to be reordered. Another case-in-point is sorting sales leads by zip code so outside salespeople can create travel plans that allow them to optimize their time in a specific location. A more personal example is your own calendar. How often do you look at it by the week to see what times you still available to schedule a meeting? All these databases affect our decisions.

Garbage In/Garbage Out

I have to admit, this is one of my least favorite sayings, although I have been quoted in print actually saying it! The worst thing about it is that it’s true. The quality of the data you retrieve is directly related to the quality of the data being entered. The morale – don’t think data entry is brainless work!

In order for the reports, analysis, and every other output (including the correct location of that important meeting you need to attend!), the data has to be good. Can you image making critical decisions based on bad data? Consider identity theft! Bad data influencing critical decisions. This is a mess to clean up and it happens all the time!

Before making any important decisions make sure the data you are using can be substantiated. Ask for some backup documentation, and run some of the reports from a different angle to make sure the comparisons make sense. Example:  If your first quarter sales are through the roof, then look at them on a monthly basis. Were some December sales erroneously posted in January?

How Much is Too Much?

Databases are also responsible for business intelligence (BI). All information that is fed into BI solutions comes from multiple databases, sometimes lots of them. The key to great BI is the ability to culminate information across databases that may not inherently communicate. The best example of this is CRM and ERP (Enterprise Resource Planning – also known as accounting). There are many CRM/ERP integrations, but not all businesses have chosen that easy route. Many businesses wind up with a CRM solution from one vendor and an ERP solution from another. By using a good BI solution, individual integration is not an issue because both the ERP and CRM databases can be read by the BI.

As a result, BI solutions that read data from multiple, unrelated databases, present a comprehensive picture of the business. The more databases it reads from, the more accurate the picture – at least in theory. Sometimes too much data can make the picture hazier. That’s when people step in. Time to take a step back and understand what all the information means and how it relates to the decision at hand.

Decisions made without data are uninformed, but decisions made based exclusively on the data are ill-advised. There still needs to be a human element of decision-making, which is definitely a good thing.

Remember, I said databases practically run our lives, but not totally run our lives.