We all know the value of data. But how could being a data-driven culture impact your organization?
Let’s take a look at Blockbuster.
Can you imagine if Blockbuster had access to data about the shifting trends from renting a DVD at a physical store to ordering movies online?
How valuable would that data have been?
Here’s the thing: They probably had that data, but the right people needed access to it and the knowledge of how to share those insights with business leaders who were determining the company’s focus.
Like many organizations, perhaps their data and analytics were set up so that only IT staff could access certain data, so you would send in a ticket, they’d solve your query, and move on to the next project, making you think that you are now able to make better data-driven decisions.
But in reality, all they’ve done is solve one query.
Perhaps their data and analytics projects resided solely in the tech department, meaning data was disconnected from business objectives and leaders couldn’t use it to get real insights to see the trends and change outcomes.
If being data-driven was a part of your company culture… you would do more than solve a query or generate a one-off report: you’d be able to use the data to:
- See trends
- Make decisions in real-time, and
- Align business priorities
Have companies learned anything from the Blockbusters and Blackberries of the world?
What we’ve learned…
It’s not technology or a tool that makes you a data-driven company, but it’s your culture.
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What is a Data-Driven Culture?
A data-driven culture is one where decisions are made based on the data, not just what people hear, see or think.
It’s one in which data-driven decision-making occurs from the top – all the way throughout every department in the organization.
A data-driven culture encourages team members to be more transparent and accountable for their work.
A data-driven culture has to start at the top – business leaders need to be asking questions and making decisions based on what the data shows and encouraging all their direct reports and teams to do the same.
By providing everyone in your company access to the right information, you enable them to use data to make better decisions.
Why is a Data-Driven Culture Important?
It’s not enough to just have the latest and greatest technology if you’re not working on instilling a data-driven culture throughout your company.
Once business leaders encourage everyone in the company to make decisions based on data, your decision-making will be more fluid and natural and easier to justify – since you’re no longer making decisions simply from gut feelings.
How to Build a Data-Driven Culture?
It starts at the top.
Once the CEO says, show me the data, then he or she drives accountability down the chain.
This accountability structure means everyone else knows they have to provide data to back up their decision-making.
It might sound easier than done, but here are a few things you can do to start leading a data-driven culture.
1. Audit your existing decision-making processes.
How are business goals currently set? How are sales quotas defined? How are projects prioritized?
It should start with the data.
2. Look at your existing data for biases.
Have you ever dug into the data to search for data that is contrary to your beliefs?
Most leaders look for data that support their decision-making. Try to look for the opposite: can you refute the claims? Or perhaps it sheds light on the direction you should be taking.
3. Analyze who owns your data today.
Is it your IT department? Data should not sit with one department but rather something to be leveraged cross-departmentally.
Everyone needs access to your data – from HR to finance to marketing and sales.
4. Align cross-departmentally on business goals and priorities.
Rather than each department driving its own metrics, the entire leadership team should have common goals that they drive across their departments.
The data will help you identify which goals to focus on.
5. Invest in new technologies.
Technology and tools are not the answer to becoming data-driven. Building technology without becoming a data-driven culture means your tech won’t tie into the business priorities and the insights generated will not be meaningful.
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Those are five steps you can take today to start building a data-driven culture.
Doing so means you can empower your teams to do their best work possible and achieve your business goals.
>> Make sure to check out the next post in the series, where we address the common roadblocks to building a data-driven culture plus how to solve them.
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