Becoming ‘data-driven’ has become the aspiration of every executive, founder and manager. Those that succeed see greater customer acquisition, retention and, as a result, major bottom line benefits. Companies are now investing more money than ever on big data tools, but 72 percent say they’ve failed to create a data-driven culture.
Interestingly, the reason behind this may not be what you think it is. In NewVantage Partners’ 2019 AI and Big Data Executive Survey, 93 percent of respondents revealed it’s not the technology itself that’s blocking them from becoming data-driven, it’s processes and people.
A joint study by Dun & Bradstreet and Forrester Research found that over half of B2B marketers are still relying on intuition and experience, rather than data, to guide their decision-making. Simply purchasing more tools won’t automatically help people start making data-driven decisions. It takes a culture shift and a shift in mindset to truly take the guesswork out of your decision-making.
Here are four essential but often overlooked changes which need to be made in order to create a culture that’s not driven on guesswork:
1. Democratize your company’s data
A new wave of companies are shaking up how businesses operate. ‘Transparent technologies’ like Lemonade are ushering in an era of radical transparency in which all aspects of the business from pricing to leadership decisions are completely transparent. And this approach is working.
A study by Label Insight found that 94 percent of consumers are likely to be loyal to a brand that offers complete transparency and 73 percent said they would even pay more for a product that offers transparency in all attributes.
It’s important to drive transparency in all realms of the business, including data. People shouldn’t be scared of data, they shouldn’t keep it locked away – they should share it, discuss it, analyze it and talk about it at the water cooler.
The problem is, while the C-suite expects their organizations to become more data driven, many still keep organizational level discussions around data and metrics behind closed doors.
Culture change starts with leadership.
Rather than keeping these conversations within the management level, start by being more transparent about your company’s results, data, revenue and growth. This could be announced during bi-weekly All Hands meetings, automated on real-time dashboards set up in your lunch/break rooms or shared in weekly internal newsletters. Whatever you decide, just make sure you do it consistently and provide context.
Keep in mind, data without direction are just numbers. Your data tells a story about your organization. Instead of simply sharing the hard numbers, share your interpretation of what the data means for your strategy.
2. Break down data silos
Departmental silos are one of the worst growing pains companies face and one of the biggest barriers to agility. As a result, many are now focusing on creating better inter-team communication and collaboration.
What we often don’t realize is just how siloed our data can become within departments and even amongst team members. In fact, managing CRM systems and data across technology silos was reported as being moderately to extremely challenging for 72 percent of B2B marketers.
Viewing two siloed data sources together can tell a very different story than when you look at them separately. This can create a major mismatch in how different departments are using this information.
While marketing may be measuring their success based on leads, how many actually have the characteristics needed to become Sales Qualified Leads? Likewise, looking at number of users, won’t tell you enough if you don’t also look at activity and engagement with the product.
In order to actually start making fast data driven decisions, there needs to be more sharing and alignment across departments. Everyone should have a clear idea of what success and how to get there using data.
But how do we give people access to data points when we’re using so many different platforms and tools to power our organizations?
Greater transparency doesn’t mean overloading your team with even more tools and data than they can handle. Instead, it’s about reducing bottlenecks by ensuring the data that’s relevant and needed is easily accessible.
Instead of adding to our current tech overload, the the open API era will be focused on tools that help us integrate our devices, tasks and data points. Already, tools like Zapier and Aerialscoop allow you to easily aggregate, automate and share selected data across departments.
3. Focus on relevant data
Greater access to data is only the first step. The next (harder step) is learning how to translate data into action. Right now 80 percent of businesses are struggling to manage the volume, variety and velocity of their data. Instead of helping you optimize your processes, this can lead to a case of data overload.
To actually make the most out of the data your employees now have access to, you need to help them understand which data points are most relevant to driving growth within your organization.
According to the Pareto Principle, 80 percent of your results will come from only 20 percent of your activities. This means that, instead of focusing on the overwhelming mass of data coming your way, you need to focus on the 20 percent of your data that will drive 20 percent of the insights you need to achieve 80 percent of your growth.
This won’t come instinctively. It requires direction from leadership to identify which areas are most important for the business at the moment and an environment that supports smart ways of working. Develop a culture that helps employees identify and prioritize the really important stuff first.
4. Develop a data driven mindset
Making data more transparent, accessible and easier to understand are all steps that pave the way towards a data-driven culture. But the last and final step doesn’t just require a change in culture, it’s about changing mindsets.
You’ve probably heard the saying, “You can lead a horse to water…” You can also lead people to data, but you can’t make them use it. But there are two ways you can help them adopt a data driven mindset.
Discuss the benefits
You know becoming data driven will improve your company’s bottom line but, as all marketers know, the best way to sell a product is to focus on the individual’s pain points. How will acquiring data skills help your employees grow and develop within their role? How will it impact their workload and success rate?
Create a habit
Don’t end the conversation after your team meeting. Encourage your employees to create a habit of checking in on your data. The best way to form a habit is by making it daily, starting small, creating a routine and setting a trigger. For example, try automating a daily aggregated report which allows people to check stats every morning with their first cup of coffee, keeping data points top of mind. The more up to date people are, the more likely they’ll be to reference and integrate data insights into their daily decision-making.
With AI and machine learning on the rise, companies will need to start getting their workforce ready to leverage even more complex but insight rich data. Starting the shift towards a data driven culture now will put you ahead of the curve. It’s time to leave guesswork behind.