What is Data-Driven Culture?
A data-driven culture enables organizations to apply the data they collect to business decisions that matter.
Rather than assessing the amount of data that organizations have available to them, a data-driven culture should support leaders to identify what’s important to increase value and growth. This doesn’t just apply to the senior leadership team: it’s a culture that permeates every meeting and leadership interaction throughout the organization.
Aligning decision-making with data can fuel growth across the business and importantly, enhance the transparency of how data investments are performing for the business. Enabling teams throughout the organization to meet their growth objectives by utilizing data will become a table stake for companies in today’s complex business environment.
Connect the experience and judgement of your leadership to data-based evidence.
Why is data-driven culture so important?
The consumer has jumped ahead of the standard operating model of most organizations. Today, she can achieve global purchasing connected with local needs. She is highly informed, price sensitive, socially connected, and trusts the crowd.
In the past, flawless execution, operational efficiency and strategic alignment was the growth mantra coming out of most executive off-site planning sessions. As a consultant over the past 10 years, I have seen that in the new age of complexity that teams now face, this mantra is no longer is enough. It fails to build the ever-increasing situational awareness that teams need to adapt.
For example, the ability of small market entrants to build a brand that resonates with consumers for very little cost is now a disruptive force in many markets. Understanding is the competitive advantage here.
In today’s this highly complex environment, profitable growth is more elusive:
- Consumers are highly informed, so relying on a legacy brand is under fire from market entrants who can mobilize a brand that resonates with targeted consumers in weeks.
- Socially connected and self promoting consumers; young women can watch a youtube or instagram video promoting a new cosmetics product and go straight to an online channel and purchase.
This is where data becomes so important, both for growing revenues and maximizing every marketing dollar.
Yet leaders are struggling to maximize the value of the huge amounts of data at their disposal to capitalize on this great opportunity; to understand faster than their competitors; to adapt faster, and to meet customer needs faster.
Through conversations with over 200 business leaders on this topic, we have come to understand that the way that teams interact with data and use it to make decisions for growth is the final mile in creating a data-driven organization.
Characteristics of an effective data-driven culture
1. Single minded focus on the mission
“When you’re trying to find a needle in the haystack, don’t add more hay”
Leaders that create an effective data-driven culture strive for clarity at every interaction. They don’t start with the data, the tool or the software: they start with the business challenge that’s in front of them. Through discussion, debate and challenge, they start to build a picture of what's important to them. This is the starting point.
Leaders establish business priorities. The data system provides the direction to value.
2. End-to-end insights - Engage the front line every day
On operations within the Royal Marines Intelligence community, we discovered that driving insights end-to-end meant the difference between mission success or failure. By translating insights from the frontline to the centre, strategic understanding is more effectively built.
“Top down” insights had value, but real advantage was creating the right flows of insights vertically from teams throughout the organization. The insights of front line operators had to be fused to the overall analysis: what are they seeing, and why?
This wasn’t about senior leaders “visiting the front line” per se, but teams having the confidence to share what they were seeing. They needed to share how the mission was unfolding with key stakeholders: specifically, what tactics were working and what weren’t.
Combining these insights with data was critically valuable.
This was not about command and control but about curiosity, improvisation and exploration.
3. Industrialise learning
The whole organization must be committed to avoiding information silos. The main focus must be on the mission, where cross functional teams can interface with each other to challenge assumptions and share across silos.
This has nothing to do with technology. It’s an unconditional mindset towards mission success and sharing with those that need to know. No team or leader keeps hold of their insight in a data-driven culture, especially if they think it could add value in another area of the organization.
4. A never-ending pursuit to fuel growth
To achieve this level of communication, building the right aptitude in leaders is of huge importance. A team’s capability to set the ideal conditions for these messy, fruitful discussions will separate the winners. It all starts with the positions modeled by executives at the top:
- We’re going to make data-driven decisions.
- We’re going to experiment, challenge and iterate.
- We’re going to test and learn.
By modeling these principles to their teams, executives make it clear that they must be embodied by members at all levels of the organization.
How to scale a decision-making framework across the organization
Establishing a data-driven culture is not a quick process, yet we have found that organizations do not need to make huge investments in technology, talent or design to get started.
This is simply about helping teams think in a different way. By following a few key principles, specifically, you can begin fostering a data-driven culture in your organization:
- Empower the front line
- Align to business value
- Break silos
Empower your teams to take action now. Download an overview of our ADAPT Data-Driven Decision-Making Framework, which we have developed over 15 years of operating in this space.