How important is acting on instinct for small businesses?
For smaller businesses that lack suitable research means and sufficient customer data, making snap decisions can be an important part of business.
Relying on gut instinct to make crucial decisions can occur on almost a daily basis, as powerful customer insight is simply not available.
This is highlighted by a report from Survey Monkey which revealed that 90% of small and medium-sized business owners believe only big brands can afford to use this type of insight.
These larger firms and brands have considerably more finance and this makes researching trends easier.
A lack of data was named by 36% of bosses as being a major issue that affects the decision making process while 81% would like more customer insight but are aware it is difficult to gather.
Research can be either too-time consuming to gather or too expensive; both issues that SMEs can struggle to cope with. Instead, acting on impulse can lead to the same results as a well thought-out plan, but this is not without risk.
The survey revealed that 72% of SME leaders make their decisions in this way due to an absence of fast and reliable customer insight.
However, getting a decision wrong could have serious implications and result in a business running into difficulty.
If done quickly, corporate recovery can limit any potential negative impacts while it can also ensure that a business can keep trading for as long as possible.
Around half of bosses said they model their own behaviours based on instinct while only one in ten said they relied solely on data to make decisions.
Finding good quality data can be a major issue and it is why many small business owners will look to act without it as doing so can be beneficial for a business.
Snap decisions can help to boost sales or reduce losses, important factors for smaller firms where lots of additional finance is not available.
By Phil Smith