Most companies today claim to be fluent in data, but as with most trends, these claims tend to be exaggerated. Companies are high on data, but what does it mean to be a data-driven company? I went ahead and asked a number of business leaders.
According to Amir Orad, CEO of Sisense, a business intelligence software provider, true data-driven companies understand that data should be omnipresent and accessible.
"A data-driven company is an organization where every person who can use data to make better decisions, has access to the data they need when they need it. being data-driven is not about seeing a few canned reports at the beginning of every day or week; it's about giving the business decision makers the power to explore data independently, even if they're working with big or disparate data sources."
Asaf Yigal, the co-Founder of Logz.io, ELK as a service cloud platform, agrees, but emphasized the importance of measurability.
"Data-driven complains are companies that relentlessly measure and monitor the pulse of the business and are doing so in a continuous and often automated manner."
Companies often proudly talk about data-driven marketing, but forget that the company itself should be driven by data, internally and externally. It's also important to remember that internal data might help produce information that can be used for marketing and sales purposes.
"There's a lot of talk about data-driven marketing and sales, etc., but not a lot about a company as a whole becoming data-driven," said Manish Sood, the founder and CEO of Reltio.
Bryan Harwood from Outsell sets says a company needs to meet the following three objectives to qualify.
It should be able to not only draw data from a variety of internal and external sources, but also be able to blend that data in an analytics engine and distill it down to actionable insights.
These insights should drive real-time decision making that infuses every level of the organization.
The data should yield quantifiable results downstream that in turn, inform the organization about which data sources are yielding results.
Considering the increasing complexity of data growing larger in size, changing rapidly and spread between many disparate sources, accessibility alone is not enough.
"Being data-driven is not about seeing a few canned reports at the beginning of every day or week; it's about giving the business decision makers the power to explore data independently, even if they're working with big or disparate data sources. They need to be able to ask questions and receive answers that are based on data before the decision is actually made -- today in many places the executive makes a 'gut-instinct' decision and then looks for the data to justify it. But if data is readily available and easy to analyze and to present in visual form, it becomes an inherent part of the decision-making process -- and that's what makes an organization truly data-driven," said Orad.
The surge of a data-driven culture has also had a significant impact on how companies are structured. The complexity of data forces companies to merge different department to harness their individual strengths to make the most of data. Being data-driven means making use of massive quantities of unstructured data – text, video, voice. In the past this belonged to the IT department which had a tough time extracting insights from it.
"Cognitive technologies allow IT to mine this data and marry it with predictive analytics to provide deeper insights into healthcare (oncology) or sales (support) or supply chain (pulling in weather/IoT data and social media data and log data and fusing it to predict supply and demand trends more accurately). Going forward this is what it will mean to be a data-driven company -- simply reacting to trends in past sales data won't cut it against the competition in this era," said Scott Crowder, CTO and vice president, technical strategy and transformation for IBM Systems.
From darkness to light: how to become data-driven
According to most experts, the road to data fluency is not easy or glamorous.
"To become a data-driven company the belief in the importance of the integrity and quality of information needs to permeate the culture of the company at all levels. It is not enough to start a formal data governance program, becoming data-driven requires a disciplined shift in the mindset of all employees towards maintaining the integrity and quality of their data," said Chris Jennings, vice president of technology services at Collaborative Consulting.
Yigal from Logz.io asks companies to treat data as religion.
"Companies need to be religious with demanding to see the data before and after changes are being made. Especially in fast moving start-up companies where changes are easily made it's prudent to track the impact of every change."
To make sure data is not only in the hands of IT and other data enthusiasts, organizations need to embrace a switch in culture. Most experts agree that business intelligence needs to be in the hands of every decision maker in the company to make sure the entire staff is aligned and fighting the same battles.
"This way, there are no 'different versions of the truth' floating around in disparate spreadsheets, and every user has a consistent experience across platforms," said Ulrik Pederson, CTO of TARGIT.
Once the organization is prepared for the switch, there are three key components of becoming a data-driven organization.
- Build a data warehouse
- Connect the most critical data sources
- Share data through dashboards, analyses, mobile business intelligence, storyboards, and report
As data volume, variety, and velocity increase, so does the organization's ability to make use of it, especially if the cultural and technical elements are in place. Analytics, resources, and skills should not be limited to a few departments, and everyone, from sales to marketing and IT to finance, should leverage the benefits of data.
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