The volume and speed of data continues to grow, and the leadership of many businesses is lagging in confronting this growing risk. I call it a risk because hidden in the multiple sources of data lies the critical insights needed to drive long term strategic value to the enterprise.
What does this lag look like for business around the world?
The first and most dangerous scenario happens when executive teams are attempting to manage the strategic direction of their businesses and contend with the volumes of data but do so in blissful ignorance pretending the big data problem doesn’t exist or that high value insights are not really hidden in this rolling tide of data.
This pretend scenario shows up when management continues to use outdated or quarterly KPIs and simultaneously fail to arm all levels of management with the tools and training to become data hunters and find the core cause of daily business performance issues.
In today’s world, some of the tried and true KPI measures are fine, but managers need to be able to validate high-level KPI directional trends or deviations by drilling into the data to identify the root causes of change in the KPI being questioned.
For example, if a quarterly KPI shows a negative deviation, managers must be armed with the tools to drill down in seconds, not days and find the root causes of the deviation. The data becomes the fuel for change not a roadblock to front-line managers.
Data shows Quarterly sales have suddenly declined, but why?
If we train the management team to be data hunters so immediate questions or changes in street level results can be examined, then responses to dynamic market conditions can be handled with confidence.
A quarterly sales decline may lead to isolating a small group of stores that caused the problems. That group of stores may lead to a review of the individual store categories to isolate the problem categories followed by drilling further into the brands and packages that may be the core drivers of the sales decline.
Intelligent management decisions can now be made regarding slow moving SKUs or the need to expand shelf space for the fast-moving SKUs for example or solving out of stock issues that are showing up.
This approach moves management from having nothing but a basic KPI metric to possessing data fluency and having the capability to truly drive business decisions based on facts found within the data.
As the NFL season is underway, we can use a football analogy. We can observe the coaches of each team during game time, carefully scanning a planned set of offensive plays that may be considered in response to defensive sets offered by the opposing team.
This is all good planning, but if the coach knows his target set of offensive strategies and plays, but the players on the field don’t know the plays with precision, or the technology links are not in place to communicate the plays to the quarterback on the field, the outcome is likely a loss.
Whether it is a coach or CEO, leadership is the key to ensuring all members of the team have the right technology hardware, the right software, the training and data literacy needed to achieve the corporate objectives of the organization.
The old gut instincts, ideologies or distributed quarterly KPI reports from upper management are fast becoming useless in today’s marketplace.
When each level of management is armed with the training and tools to be a data hunter and in just a few seconds see the outliers and causes of problems, then decisions become more fact based and trackable.
This allows upper management to implement a true performance management culture where critical market decisions are made, tracked and rewarded based on results achieved.
In the process of implementing this type of operating culture, don’t get intimidated with the bantered terms such as BI, data analytics, big data etc. These terms often just disguise the basic questions of what data is needed for a local manager to quickly drill down to make an informed decision and be held accountable for that decision? And what technology hardware and software can deliver that data hunt in seconds to the front-line manager who will make that decision?
This basic approach will arm managers at all levels with the data literacy and competence needed to deliver consistent and sustainable business outcomes while minimizing the inherent risks in the process.