It’s no secret that with the advent of the Internet, the world has become data-centric. Data plays the most crucial role in defining the extent of success for every organization. Whether it is the analysis of your organization’s performance or it is the critical data of your customers or even the data related to your employees, analyzing it and deducing meaningful conclusions has become imperative to develop strategies for the organization. Therefore, as organizations become more aware of the importance of data they get more inclined towards becoming data-driven.
A data-driven organization undoubtedly has numerous benefits over other organizations in the same domain. In a report by McKinsey Global, a data-driven organization is 23 times more likely to get customers, 6 times more likely to retain them, and 19 times more likely to be profitable. Apart from the competitive edge, some of the perks of being a data-driven organization are:
More accountability: Data increases transparency and accountability which eventually leads to better compliance and improved teamwork in the organization.
More room for enhancements: Data reveals the areas of improvement for the organization through key performance indicators and their analysis.
Better and insightful business decisions: Historic and real-time data analysis allows a comprehensive understanding of previous business decisions and drastically improves decision making in the future.
Consistency: Being dependent on the data eradicates your organization’s dependency on the employees which ensures consistent performance for the organization even if any employee leaves.
Better responsiveness: Being data-driven, the organization will have unlimited resources, such as historic data and real-time analysis, for reacting to situations that occur in the future.
Why you should be a data-driven executive?
Even though being data-driven is a top priority for every organization in the modern world, they have been facing tough challenges in achieving this status. A prominent factor behind this is the inability of organizations to form a culture which should be data-driven and a considerable role in the formation of an organization’s culture is played by the top management which is the executive roles. Employees tend to follow their executives by adopting the same practices. Even if a junior-level employee is data-driven, it won’t ensure the growth of the organization unless the upper-management becomes data-driven too. Therefore, it is imperative for the executive of an organization to be data-driven in order to promote the required culture and eventually reap the astonishing benefits of being a data-driven organization. But now the question arises – How to be a data-driven executive?
Steps towards being a data-driven executive
Embrace the change
Executives have spent their whole lives in making decisions driven by their gut feeling or from the advice of another expert or even an industry veteran. They show reluctant to a change where they have to embrace a data-driven approach. Making decisions based on data does not require any new skills.
Your existing experience and ability to interpret data is all you need to commence your journey towards being data-driven. Start with basic data analytics or business intelligence practices and pave your way to becoming a data-driven executive. You will end up encouraging the junior management to follow in your footsteps by setting the perfect example.
Data governance model
To be the epitome of a data-driven executive, you must have a governance model defining the roles and responsibilities of other members. An ideal governance model will also include using best practices for data storage, monitoring, and management. As a result of setting up data governance, the data hygiene of your organization will improve drastically which will enhance the application of data analytics at a large scale.
Having a data governance model also means that you will have a data strategy which, as revealed by studies from Gartner and MIT, shows that your organization is better equipped, will have a better market value, better return on assets, and eventually, it will outperform than its competition. Establishing a data governance committee can be an alternative to reach this goal as the process involves extensive practices. This committee will be involved in the comprehensive data-related tasks such as data definition, policies, integrations, infrastructure, architecture, and internal business collection.
Appointing a CDO
The journey towards being a data-driven executive is not one that you can complete on your own. The role of an executive involves a significant number of time-consuming and critical tasks that need to be carried out on a daily basis. Therefore, you need an operation partner who will be dedicated to promoting a data-driven approach and who would be skilled enough to cultivate appropriate decisions from the available data. While the executive will be the face of the organization promoting a data-driven culture, with the help of this partner he will not be required to actively involved in each step.
One logical solution can be the appointment of a chief data officer or a CDO. A CDO is a C-level executive who is responsible for the overall governance in the organization and performs various tasks such as data processing, analysis, data mining, and information trading to help in making optimized data-driven decisions. He will also be responsible for organizing and leading certain culture change programs such as educational programs to increase data related literacy among the employees.
Other steps that an executive can take for becoming data-driven includes:
- Prioritizing the use of data for various business operations.
- Incorporate technology solutions
- Involve in various training activities for enhancing your skills
Being data-driven is no more an option, it has become a necessity in the modern world. An organization can thrive regardless of the high competition if and only if it is willing to be data-driven and the major role in this approach is of the executives. He is the torch-bearer for consolidating a change in the organization’s culture.
Therefore, it is crucial for an executive to inculcate a data-driven approach for his various operations in the organization. From decision making to developing new strategies, he should adopt a data-driven approach.