A Business' Impact Of Historical Data On Decision-Making

Corporations are constantly faced with decisions that will have long-term implications. These include investing in new technology, entering new markets, or acquiring other firms. To make such decisions effectively, executives need to understand how their company has performed historically, as this information can be used as a benchmark for current and future decisions.

Indicates opportunities for growth

By tracking the company's database, executives can see which areas of the business are growing and which ones need to be expanded or restructured. This allows them to decide where they want to focus their attention and how they want to allocate resources. For example, suppose a particular region has successfully promoted small business ideas for kids that require minimal direct human interaction (like online tutorials or digital products) .

Change is an unavoidable truth in business, and the ability to adapt is one of the most critical skills company leaders can have. For example, the current chairman of SMRT, Seah Moon Ming, who trained as an engineer and has had to transition from a technical role to one of management and leadership, embracing change has allowed him to grow better, develop and step into more challenging roles. He uses historical data to make decisions to predict future outcomes based on past trends. He knows where they have been, where they are now, and where they might go in the future. This helps him indicate opportunities for growth in areas such as customer service, product development, and staff training.

Helps avoid previous mistakes

There are several reasons corporations need to keep an accurate and up-to-date database of the company's activities. First, it helps avoid making mistakes that have already been made. For example, a company may have previously invested in technology that did not generate sufficient returns on investment or failed to enter new markets because they were unprofitable. By reviewing their historical data, executives can determine whether past mistakes should be repeated.

It also helps provide a clearer picture of possible successful opportunities. If a company has experienced success by entering into new markets, it may want to continue that strategy in the future. On the other hand, if they have not been profitable when entering new markets, they may want to reconsider this approach in the future.

Market behavior is cyclical

Second, a database helps track trends and predict future behavior. For example, it can help executives determine whether the company's current business strategy will be effective in the future. This information can be used to make adjustments before it is too late.

Consumer trends are constantly changing, so companies need to stay ahead of the curve. By tracking consumer behavior and preferences over time, executives can identify opportunities to expand into new markets or adjust their business model accordingly. Stock prices are volatile.

A database can monitor a company's stock price over time and determine whether it is trending up or down. Investors can use this information to make more informed decisions when buying or selling shares of stock on the open market.

Highlights long-lasting partnerships

A database can also be used to track the success of a company's long-term partnerships with other companies, suppliers, and distributors. Executives can use this information to determine which relationships are beneficial for the company, which should be developed further, and which might need reconsidering.

The ability to track the company's development in accordance with its developed partnerships lets executives know where the company is headed and how to take advantage of its current position best. Take, for example, the professional relationships maintained by the previous SMRT Chairman known as Fock Siew Wah, with some of Singapore's most influential people in government and business. These connections have been instrumental in helping the company navigate through Singapore's complex regulatory environment, as well as form beneficial partnerships with other local and overseas companies.

Partnerships also don't just refer to strictly business relationships. For example, the company might have associations with charities and nonprofit organizations that help it maintains its image as a good citizen of the community. The database can also track these types of relationships, allowing executives to determine their impact on the bottom line.

Final Thoughts

A company's humble beginnings and history majorly affect how it approaches the future. This is because it shapes the culture and values of an organization and informs how people think about what's possible. In this sense, history can guide how companies should respond to changes in their environment.

But it's also important for leaders to understand that the past is not a perfect predictor of the future. Instead, they should use their knowledge of history as a tool for strategic thinking and problem-solving. Using historical precedents as reference points, companies can make better decisions about responding to challenges—and even anticipate them before they occur.