Extract and define value and utility from information

Many organisations are looking to digital transformation efforts to redefine their business models in the face of ever-increasing digital disruption.

But a major challenge is shifting mindsets from collecting and collating data to extracting value from it. In transforming their organisations, many companies have begun to consolidate and organise vast amounts of data and are wondering what to do next.

Those companies that have devised an approach to leverage their data stores will have a competitive advantage over others who don’t. According to IDC¹, much of the focus in digital transformation is on transforming leadership that is, establishing a clear mandate from the CEO to effect change in the organisation.

But the report notes, “Organisations also need to look at omni-experience (seamless and enhanced customer, partner and employee experience in the digital and physical world), new operating models (to drive new revenue streams) and work source (to attract and retain the best talent to enable innovation at speed and scale).”

IDC calls this ‘information transformation’. According to the study, IDC notes that ‘Having access to the most accurate, insightful, real-time data in an easily digestible format that enables fast and often automated decision making will not only feed the four dimensions above but is likely to be the main success factor for an organisation in the digital world.’ In other words, data is the core of the digital transformation process.

Taking the right steps now and working with the right partner to generate an information transformation strategy, one that will harness the power of data to plug the gaps in skills and tools will be critical. This, in turn, will drive the success of future business models to compete against more agile and responsive competitors.

When an enterprise embarks on digital transformation, the relevant stakeholders tend to think in terms of changes in technology, process and skills they will have to make.

But the more time you invest in digital transformation, the more your organisation will realise you’re not selling a product or service anymore; you’re selling outcomes or insights. You need to redefine your business model, and the key to getting this right is in developing a data-driven culture of decision making within your organisation.

A data-driven culture will provide all employees access to the same data at the same time so they can come to conclusions (though likely different) from the same dataset. This will improve the speed and ability of everyone in the organisation to make decisions, creating a better velocity within your business.

You can inculcate the culture by educating your workforce to ask challenging questions without clear answers. Most times, employees pose safe questions because they know what data is available to them.

Encourage them to ask tough, transformative questions which they don’t have the answers to, and then figure out how to find the data that will provide the answer. For example, “What would give the bottom line a boost? Hiring five new senior marketing managers or adding $1 million to the overall budget?”

Four steps you can take to achieve this:

1) Align the data to a related business process, and go back and ask who are the people involved that touch this.

2) Determine if you need to go outside the organisation to get the data

More often than not, answers to transformative questions reside outside the company walls. There must be a plan to get access to that information.

3) Decide how often the company will retrieve that data

Sometimes you need near real-time data to make an offer to someone who’s buying right away. Other times, it has to be real-time because it is a mission-critical situation. Sometimes, you need data that’s even smarter than that, that’s predictive.

4) Seek out the right tools or partner to accelerate the culture change

The best data-driven organisations aren’t the ones that have really good answers. The best organisations are the ones that empower their employees with the freedom to ask better questions.

In order to understand the hidden value in a company’s biggest asset, its data, begin by identifying what sets the company apart, then focus on areas of improvement. Once you understand the goals of the business, the extraction process will provide insights into the company’s competitive advantages.

Step 1

Verify if your data is aligned with your business goals. Is there an obvious bias that is colouring the decisions being made? Are there missing values? Process and clean the data to refine the data sets before making any decision.

Step 2

Explore the data for patterns, trends, and clusters. This is the time to examine relationships and build hypotheses according to your findings. There are a number of simple yet powerful visualisation tools to help focus your decision-making.

Step 3

Build a range of models to provide different perspectives of the data. There may be more than one model that will work for a specific problem or business model. Take note of false positives and errors, and document all assumptions and results clearly.

Step 4

Generate trends/predictions from the data. The goal is to actionable results that lead to valuable business decisions.

Step 5

Validate your business decisions by allowing time to assess the impact on your business operations. It is important to carefully validate the results against the initial business objective.

Great decisions start with value, not data.

Companies have to determine how data can help deliver meaningful business improvements. They need to first identify important sources of new value to customers and their business, and then build the data and analytics capability required to capture it. Without this focus, companies risk wasting valuable time and money. Often the difficulty is not generating new ideas but prioritising the ones they have. The right question to ask is, “Where is the company uniquely positioned to capture value?”

Speak to us to find out more.

¹ Harnessing the Power of Data to Drive Digital Transformation, IDC August 2016