We have already talked about data, but before you enter the realm of the immense quantity, you should turn to the problem you are trying to solve. Do not be deceived by all the technological advancements and beautiful stories. Otherwise, you will buy a hammer and go on the adventurous search for the right nail.
As we concluded in our last article, the world is getting smarter. And this evolution can be seen everywhere, and no industry or sector is immune. You have read article heads about the recent hypes as big data, digitalization, and robotization. And while Gartner is giving the Internet of Things, Blockchain and Artificial Intelligence a new media boost, most of the organizations haven’t even started revolving the first three first hypes. Because where should one start? As mentioned in our first article, we want to be your guide through these hypes, starting with Big Data. And while we at it, we are going to let go Big in this story. What is a data-driven organization and how data-driven organizations use Big Data to perform the decision-making process at their best?
It all began with the IT – one of the most transitions in the modern world is the fact has become a primary process. This transition required a completely different mental model of the way we perceive an organization, like your company, which existed before IT became important. As a result of technological advancement and the rise of the Internet – the processing of data and the creation of new information have evolved later on. There is also another reason why now all organizations can exploit the value of data. At this point, we are capable of consuming large amounts of data but also process it into insights due to the high availability of tools for storage, processing, and visualization. Nowadays, all organizations can be data-driven!
What is a data-driven organization?
A data-driven organization uses data as a critical part of its strategy, which informs and affects the company through evidence-based culture — data that is trusted by the organization as a whole, and used for planning all next steps. A data-driven organization functions following the next six steps:
(1) Question – ask the right questions. In every data project and especially when transitioning into a data-driven organization, one of the essential parts of the process is asking the right questions based on Key Performance Indicators. There are about ± 75 critical KPIs depending on the industry you are in, and they can be divided into these categories:
- Financial
- Marketing & Sales
- Operations & Supply Chain
- Employees
- Customer
- Social Responsibility
- IT & Technology
The exciting thing is the fact that there are 10 KPIs that make a difference for every organization. But we are going to dive into those details in our next article.
(2) Discover – Discover which data is needed to be able to answer these questions. But also which data is missing and how you can acquire it, ingest it, and store it for further analysis. The journey begins with the data from the systems and applications within your organization. The discovery can be expanded with data from partners, public data, sensors, and machine data or data from social media or data brokers (paid data).
(3) Ingest & combine – the selected data sources. To be able to question data, it has to be cleansed and integrated. For this, the organization needs to develop a logical model that enables the associations and correlation between datasets and insights.
(4) Use – Use data for the development of reports (monitoring) and analysis (competitive insights).
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(5) Value – Derive value from the process and repeat it for each KPI in different categories. You do not need megaprojects, but agile projects that deliver value and can be assessed immediately.
(6) Employ – Use the information and make timely decisions while the value of the data is high. The following image shows when you should use your data, i.e. when it is the most valuable and how it decreases over time.
To sum up, in times when data is crucial you need to become a data-driven organization so that you become successful. Once we have covered data-driven organizations and the steps every data-driven organization undertakes, in the next article we are going to talk about how you can become a data-driven organization.
