Data-Driven Organizations Outperform Their Competition

In October 2012, the Economist Intelligence Unit surveyed 530 senior executives from North America, Asia Pacific, Western Europe and Latin America across a broad range of industries. The most interesting in the assessment by CIO.com is that practically, what does a data-driven organization mean? What are the benefits of a data-driven culture?

But first some interesting findings:

  • The survey found that only 11 percent of respondents felt their organizations make substantially better use of data than their peers.
  • 76 percent of executives from top-performing companies cited data collection as very important/essential, compared with only 42 percent from companies that lag their peers in performance.
  • Nearly 70 percent of respondents said recruiting and retaining people who are effective at analyzing data is “somewhat” or “very” difficult. Underperforming companies, as well as companies in the Asia-Pacific region, rated the problem even more severe.

Data-driven culture being more than data specialists

Jim Giles, author of the Economist Intelligence Unit report, Fostering a Data-Driven Culture said:

“Let us start with what a data-driven culture is not. It is not a belief that data are an issue for someone else in the company, a job for a data specialist or perhaps the IT department. There is still a perception that a data specialist, perhaps a recent statistics graduate, should be parachuted into an organization to advise on how to work magic with data, much as a computer security expert would be called on to help shore up a company’s IT networks.

“They are placing data at the heart of almost all important decisions. And they are tolerant of questioning—even dissent—about business decisions being made, as long as the questioning is based on data and their analysis. This is what it means to adopt a data-driven culture.”

I absolutely agree on this, it’s the integration of data in the daily operations, in decision-making, in accountability and so on. The rise and need of data specialists is starting to grow, so it are the existing employees that will have to change and transform. This is scary though, data brings transparency, brings accountability and what more. This openness and the acceptance of it doesn’t come overnight.

I’ve around in a very data-driven forward thinking e-business for five years and it definately is a holistic approach and not simply having excel sheets and data scientists.

Change and success enablement

As with all change, to be succesful, it need to achieve four things:

  • Align data-driven strategy with business objectives
  • Build internal capabilities
  • Tailor organizational design to operations
  • Create a culture of sharing, accountability and learning

To achieve this you need both top-down commitment and bottom-up empowerment, if you don’t have both, it be a hard battle. It’s all about co-creation.

In a research by Capgemini and MIT Center for Digital Business it found that digital mature companies outperform their peers in every industry, digital data being a subset of data is an extra proof-point.

What’s your biggest challenge in data-driven culture adoption?

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