They optimize resource allocation
Itâs one thing to develop a data-driven strategy; itâs another thing entirely to effectively execute on the plan. Thatâs where having the right resources in place and updating them as needed is important.
âOnce the strategy is defined, the people, process, and tools to support the strategy are critical for a data-driven organization,â says Kathy Rudy, partner and chief data and analytics officer at global technology research and advisory firm ISG.
For example, organizations need to have a process for building data catalogs; procedures and tools for data cleansing and data quality; defined data use cases and the right tools to support the use cases; effective and secure access to data for internal and external users; overall security to support the use cases; and a data center of excellence to support complex data requests
From a people perspective, being a data-driven organization means having a solid team of data analysts, data scientists, data engineers, and other professionals in place, and providing the necessary training when skills need to be updated.
They emphasize data governance
Data governance is another component of the overall data strategy that warrants extra attention. Governance encompasses data security, privacy, reliability, integrity, accuracy, and other areas. Itâs essential to maintaining a data-driven operation.
âWithout data governance, you cannot trust that the data you are using is of high quality, is synced across data sets by a common taxonomy, or is secure,â Rudy says. âData governance also provides the foundation for access to the data.â
ISG is often faced with disparate databases with differing taxonomies and ways of maintaining the datasets, Rudy says. âOnce we established a centralized data governance methodology â with people, processes, and tools â we were able to develop new ways to use our data internally and externally for client delivery, products, and data monetization.â
The centralized approach also established proper security protocols for data access inside the business, Rudy says. âMany people think data should be democratized, though Iâm not convinced of that,â she says. âUnless you truly understand the source for the data, how it was collected, the context of the data, and [how to] analyze data, improper use can lead to bad decisions.â
For example, when the ISG sales teams asked for account information, the data team began pulling reports and discovered there were multiple names for the same client. âThis made it very hard to pull together a snapshot of business over time, what was selling, by whom, etc.,â Rudy says. âLack of governance over our data led to dirty data in our system, and an incomplete picture of a client that might have led us to incorrectly design an account strategy.â
Responsible data use is paramount for data-driven organizations, says Deepika Duggirala, senior vice president of global technology platforms at TransUnion, a provider of financial services, healthcare, and insurance technologies.
âThis means securing all data within an enterpriseâs data ecosystem â both in motion and at rest â while maintaining the privacy of associates and consumers,â Duggirala says. âAn enterprise must be able to evolve alongside growing data protection regulations, doing so by educating all associates on US and international data privacy and protection regulations, and building security and compliance into the initial design of all data storage and consumption. This mindset is how TransUnion makes trust possible and protects our data ecosystem and its compliance.â
They establish a broad data mindset
Building a data culture and mindset is part of the overall data strategy, but it bears special mention because it truly helps bring the strategy to life.
âAll aspects of decision-making are influenced by data,â Duggirala says. âAssociates are fluent in its interpretation to better understand the market and make sound decisions. This is the core of TransUnionâs product development process â product managers, customer experience designers, and developers all leverage a different facet of our data to identify solutions that solve specific needs, define launch timelines, and ensure simple, intuitive features.â
At companies that are data-driven, âthere is an organization-wide acknowledgement that data is at the heart of decision-making,â Rudy says. âSo, when challenges are posed, questions are asked or strategy is designed, people automatically reach for data to support decision-making.â
At ISG, âfrom marketing and sales materials that describe our credentials, to client deliverables where data is used to substantiate recommendations, industry briefings where we back up our knowledge and expertise with data and facts, data truly is at the heart of everything we do,â Rudy says. âData gives businesses a competitive advantage. We view data as circular. We are continuously in the process of collecting, validating, managing, curating, and analyzing data to drive insights for all our stakeholders.â
Data-driven organizations have many drivers, says Theresa Kushner, head of the Innovation Center for North America at consulting firm NTT Data. âThis means that no matter where you sit in the organization, you can have access to the data you need to do your job,â she says. âNon-data-driven organizations are usually siloed in their approach to data management.â
NTT Data research shows that a minority of organizations say data is shared seamlessly across the enterprise. âIn a data-driven enterprise this is not the case,â Kushner says. âBecause these groups are directed by their leadership to make decisions based on data and because they have teams that pay special attention to key data sets, they can move quickly and drive their businesses using accurate, readily available data.â
Regular collaboration is key to having a data mindset. âData is nothing without people sharing and using it,â Kushner says. âEffective data-driven cultures depend on efficient collaboration and open communication between owners of the data and its users. This trait of a data-driven organization supersedes all others such as training, certification, data governance, regular process updates.â
They make data collection a primary concern
Many AI projects are shelved in short order because data scientists cannot find the data that is needed for a proposed model, Kushner says. âOftentimes this is because the data was never collected,â she says. âData-driven organizations do not have this problem. They know which data domains are important and necessary to the running of the business, and they ensure that these datasets are protected and curated.â
For example, most companies have customer relationship management (CRM) systems that are used by sales to record and track opportunities, Kushner says. But the data in these systems is often incomplete for customers and their transactions, especially if data entry is the responsibility of the salesperson, she says.
âThis means that when data scientists want to create a customer model that identifies those customers who will buy at a particular time or from a specific channel, the data they need might not be available or complete enough to support the model,â Kushner says. âData-driven organizations, however, understand that this data is primary to running the business and as a result ensure that data management practices are thorough for key areas.â
In many cases, to ensure that data is entered appropriately, these organizations automate sales entry processes to free sales from tedious entry tasks. âDepending on the business type or industry, key areas may change,â Kushner says. âFor example, manufacturers may find that managing the information on their suppliers more closely is their key data domain. No matter what industry, data-driven organizations have a plan for collecting, managing, and using key data.â
They foster strong collaboration between IT and the business Data-driven enterprises tend to feature good working relationships between IT and business leaders. For example, when the CIO works closely with the finance department, a company can maximize the value of financial data.
âDelivering the right information, at the right time, in the right format to executives and managers requires a close partnership between the CFO and CIO,â says Lynn Calhoun, CFO at professional services firm BDO.
âThis includes getting the finance and IT teams together to define information requirements, collaborating on setting up the right IT systems and architecture to meet those requirements, and working closely to implement and support agile systems and processes that can keep pace with todayâs rapidly changing business environment,â Calhoun says.
In BDOâs case, âwe work closely together to understand what the business âneeds,â not just what they ask for, which is usually constrained by what they know,â Calhoun says. That constraint limits the ability of the business leaders to achieve their goals, he says.
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