This article is part of a series in which Reverse Tide explores some of the most critical skills in today’s economy. While not every job necessarily requires such skills, these are some of the most in-demand generic skills found on job postings and employer wish lists. For those of you looking to expand your career, make yourself more attractive to prospective employers, or learn some of the most topical skills, we will explain why we believe these are so important.
Let’s Use an Example
Imagine I own a restaurant and you are the restaurant’s manager. My challenge to you is to figure out how we can increase profits. I give you 6 months to come up with a plan and present it to me. This might seem easy at first glance, as you have plenty of ideas off the top of your head. You could improve customer service, try new marketing efforts to promote the restaurant, or try to hold special events. While common sense would dictate that these are certainly profit-making ideas worth exploring, anybody could have come up with such suggestions. As the owner, I’d want facts to guide my decisions rather than just the new idea of the month. Now what do you do?
Data & analytics apply to very basic situations like that each and every day. A restaurant is a common business, but owners are leaving opportunities on the table all the time. Do you think chains like McDonald’s or Hard Rock Cafe simply call up all their franchise management and ask for some new ideas to build profitability? Of course not. They use very sophisticated tools to track everything that is going on in their restaurants:
who is ordering which quantities, how this statistic varies by country and specific location, what inventory levels for raw materials are, and so much more. Thus we should be able to use a similar approach to this single restaurant example.
Let’s look at how you might solve this question the right way…
The first step is to collect data on what is happening in the restaurant. If there isn’t a tracking mechanism for every order and some data to support it, it’s time to immediately put this in place. Some of the items recommended tracking:
- How often each menu item is ordered
- The cost to make each menu item (ingredients, shipping, a portion of the cooking and service, etc)
- Pricing of each menu item (including if there were sales, coupons, or other promotions used when purchased)
- For each unique order, what else is being ordered? Appetizers, drinks, desserts, etc
This is simple enough. After a few months of tracking, imagine what sort of information you might be able to gather:
- Some menu items don’t sell very well, while others are really popular
- Some menu items are extra profitable because they encourage people to order drinks
- Some menu items, while popular might not be as profitable because they cost a lot to produce
- Some menu items are highly correlated with price, while others are not
- Some menu items sell differently on different days of the week or at different times of day
Expanding Your Capabilities
Coming to simple conclusions like that using data and statistics is a big step and much action can be taken. You might add or remove items from the menu. You might experiment with higher or lower pricing to find the most profitable point. All very good stuff, and just by simple software-based tracking, you will have made some really profitable moves. But why stop there? If just collecting the data and making simplistic observations yielded that type of result, I bet we could dig even deeper into the power of data. A few more things you might try:
- A customer feedback mechanism. For each item ordered, have the server give a 1-5 rating for customer enthusiasm for the dish that includes what they say, whether they finished the meal, etc.
- Experiment with basic behavior points. If something is labeled as a special of the day, does that make it more likely to be sold? Can less popular menu choices be moved to “specials” so ingredients aren’t wasted on less popular items?
- We’ve covered a lot of revenue items. What about costs? Are there common ingredients among menu items so the restaurant can save on orders? Is there any correlation between ingredient cost and menu popularity?
- Ok, now that we’ve covered revenue and cost, what are some other points that influence profitability? How about table utilization? How long is the average meal taking to be served and how long is the average customer staying at the restaurant?
Which is more profitable?
- Is it better for the restaurant to take more reservations or leave more tables for walk-in customers?
- What is the typical customer demographic? We aren’t just talking about gender, age, and other such features. Are the customers local or on vacation? Are they coming to the restaurant from a booking service or directly to the restaurant? Are they coming in small groups or large? Can marketing and promotions be altered to either appeal more to that demographic or diversified to appeal to others?
There’s so much more potential… we’ve only scratched the surface. All this can easily be done on a small scale like having a single restaurant. The capabilities grow as more data is available and the need is that much greater (say if you have many restaurants versus just one).
Everyone eats out at restaurants, hence why we use this business to illustrate what data can do. However, these same questions can be applied to any industry or business model. This is why Reverse Tide believes Data & Analytics is the top skill you can have in your career. It is applicable to anything and extremely powerful when done well.
How To Learn?
Before we wrap up, let’s use the restaurant example one more time to help people with their own learning journey. What skills would you need to utilize data & analytics successfully in that (or virtually any other) example?
- You would need to know what information should be collected and why
- You should be comfortable using basic software to collect these data points (preferably automatically capturing it rather than requiring manual entry)
- You should understand how to store large data sets and then mine the data when you want to answer your questions (since in this example, you’re not just collecting a single day survey but data across a long time period)
- You should understand statistics and manipulation techniques so in this example, you can turn 6 months of data points from thousands of customers into a meaningful conclusion
- You should be able to make your life easier and work with the right software to not only collect and store the data but turn it into presentable graphs, charts, and statistics
- When you get to presentation time (in this case, presenting to the owner), you should have the right analytics presentation skills. There are some definite best practices in general presentations and in presenting conclusions and recommendations you could leverage
- You should have the skills to take a small time example like this and apply it to something much larger. Could you capture, store, mine, and manipulate data from 1000 restaurants all over the world and then present findings?
While this may feel overwhelming, it’s really not. Good software makes this really easy and it’s a skill that is both fun and easy to learn. At one time, you hired specialists to do this type of analysis, but not anymore. People of all job descriptions are expected to have basic data & analysis skills, while those with top skills are experiencing big demand in the career marketplace.
Start your own leaning today. We’re pretty confident that you can apply these skills professionally or personally, and you will find that they are extremely valuable as either a supplemental skill to your primary job function or a valuable career specialization.
Where to Learn
Reverse Tide has several curriculums to get you on your way:
The first place to start is with our Data Science & Analysis Learning Path. Here you can learn the steps we outlined in the restaurant example above.
And for more of a business (rather than technical) slant to the same topic, check our our Business Analysis Learning Path
*** Work with us directly on your data & analytics skills and resume!!! Reverse Tide has launched its own personalized career & education services. We want to work with YOU to build the best data & analytics skills and give you the best chance at the jobs of your choice. We offer tons of services where we interact and work with you directly! For more information on what we offer, check out Reverse Tide Personalized Career Services