A data-driven company — what does that mean? Does it imply you need some special graphic charts hanging around the office, a specific number of data scientists at all times or maybe a fancy AI algorithm that determines which Game of Throne character you are without any initial interaction?
With such frequent use of the word “data-driven”, it’s quite surprising no one knows what definition it really holds. So let’s dive deep and find out what getting a company to become data-driven means and what are the steps to becoming one.
What is data & Why is data important
So what is data-driven management? According to the official Wikipedia definition, data is “any sequence of one or more symbols given meaning by a specific act(s) of interpretation”. Digital data though, is data represented using the binary number system — the combination of ones and zeros.
Well, and when it comes to reasoning why is a data-driven strategy important, here’s new evidence — data is now more valuable than oil! Yes, you read that right, according to the sensational Economist article, data now has more impact and a higher value than that of the natural gas and oils, resources that have been in charge of propelling the modern age technological revolution for the past decades.
And according to the statistics of 2019, companies like Apple, Samsung, and Verizon communications are leading the list of the 200 richest companies in the world. That said, collecting, analyzing and using data resulting in comprehensive data-driven management is the fastest and most sufficient way of propelling your business up to date.
What is a data-driven company
When looking on the web, you can find a lot of definitions of various accuracy of a data-driven company. What it comes down to is this — a “data-driven” approach means a company makes decisions based on data analysis and its interpretation, as opposed to decisions based on the highest-paid person’s opinion, HiPPO.
In the old business paradigm, strategic decisions were often made because a high-status executive thinks so, overriding any contradictory opinions of the lower-status employee.
The new paradigm reveals how that outdated approach can be destructive for a company, and switches to a decision-making model which is based purely on facts and data findings. No hard feelings, no preferences involved — in data-driven management, only the numbers are allowed to speak the loudest.
So how to become data-driven? To employ a data-driven strategy, the company has to focus on two main areas:
In the next sections, we will review each point and explain why is it crucial on the path of getting a company to become data-driven.
Data-driven aspect: data
Non-surprisingly, the company becoming data-driven starts with data. To be considered truly data-driven, a company’s data has to match the following criteria:
The cohesion of data across your ad platforms
The truthfulness of data that can be proven over time
The wholesomeness of all data from all sources available
The absence of any errors, duplicates and incorrect data
The availability of data at the important decision moments
Data-driven aspect: culture
Data is the first milestone on the way of a company becoming data-driven, while the second one is a culture in which a company resides. As we mentioned earlier, only an enterprise that makes decisions purely on data findings is considered data-driven.
As you can see from the list below, the trick on how to become data-driven starts with data and ends with the culture that supports this data analysis approach. To create a data-driven culture, you have to perform certain day-to-day actions under the following categories:
The accuracy of your data is the foundation of a data-driven culture
The data analysis training that teaches employees how to use data
Embedded analytics on the organization, enterprise level
- Decision making
The mindset that is anti-authoritarian and fact-based
- Data leadership
The presence of a Chief Data Officer or Chief Financial Officer who oversees the whole process
An inclusive, supportive environment that favourites facts over statuses
How to become a data-driven company
Getting a company to become data-driven is a complex, but if treated right — also a fun task. At the end of the day, it consists of two parts we mentioned above — how we treat data and how we train people handling it.
To make the process of your big data company or data organization become fully data-driven easier, we created this list that will provide you with practical points you can follow and therefore make your management data-driven.
1) Daily use data
You want your employees to have access to the data-driven analysis side of the company when possible.
You might not want to share access to the whole nitty-gritty side of every department’s analytics, but what you can do is share data visualization dashboards like those of Google Data Studio or Power BI and allow everyone involved in the project to watch the progress and milestones they’ve achieved collectively.
2) Communicate data
Communication between colleagues should also become more and more data-driven. How? Well, firstly in meetings or disputes opponents should prove their points based on facts, not on personal preferences.
Then the executives themselves should showcase important data-driven analysis findings during their presentations and speeches which signifies the importance data holds. And lastly, the whole nature of email, chats and other work-related correspondence should be highly data-accurate and be taught during data-driven training.
3) Host data training
The “How to Become DataDriven” and “How to become data-driven” in the eyes of the search bar and the data analytics are two different entries. Such a simple thing as mentioning or naming files inconsistently can cause task delays and progressive communication inefficiency.
To avoid these, big data companies and data organizations are implementing frequent employee training sessions, that teach workers how to handle, interpret and communicate data.
4) Make data-driven decisions
We can not stress enough how important this part is. Data-driven company leaders make decisions based on data only.
Even such a simple act as requesting data prior to decision-making displays using data analytics as an essential part of the work process, therefore encouraging everyone else to prioritize it in their own decision-making.
5) Issue data-related rewards
This is the most obvious, yet the most overlooked of all pieces of advice on how to become data-driven. What’s the best way to motivate your employees to switch to a new paradigm than to offer them a monetary incentive?
Reward the best data insights this month or the most profitable data strategy a quarter — there are numerous possibilities as long as the goal is achievable and keeps employees motivated.
6) Include data in a Newsletter
Okay, this one might not be for everyone but it still is quite a valuable trick on how to get a company to become more data-driven. Especially if you already have a company newsletter!
Just include the news on goals that have been achieved and succeded, the employees that have won certain data-related rewards, and info on how these accomplishments are benefiting the company as a whole and voila — you got yourself another way of involving your employees with a data-driven approach.
7) Display data
This is the final piece of advice on becoming data-driven. If you use data, if you breathe data, if you love data — show your data! Display it on the monitor screens, conference room walls and other appropriate places.
Showcasing your company achievements makes each team member feel valued and his time, skill and effort investment — important.
As you can see, the secret on how to become data-driven has been revealed, and becoming a big data company is not as scary as it seems. It’s also way easier if you hire a Data Analytics & CRO agency just like ours to manage all the fundamental points including your data accuracy setup, data quality, it’s management and interpretation for you.
We love data, and proud ourselves in helping companies become data-driven. That’s why we also represent a data-driven culture in our company that every day brings us closer to the future 🙂
Originally published at https://insightwhale.com on October 8, 2019.