Data Analytics is not an easy thing and more than often companies are over-whelmed by large volumes of data. It is very aptly articulated by Christopher. He is a co-author of a beautiful piece titled Drinking from the fire hose: Making smarter decisions without drowning in information. He makes quite a few great points in the book very relevant to the corporate world where companies choke on exponential volumes of data but not being able to really use it. Frank so clearly lays down the problem, companies want to use data to make smarter decisions but they do-not have any direction on how to go about it..
The HiPPO effect
The best-selling author Avinash Kaushik who has written Web Analytics: An Hour a Day, has coined the term the HiPPO (highest paid person’s opinion) effect. In a number of organizations, when a HiPPO is in play, decision-making gets tied to a person’s likes, dislikes or as people simply call it ’The gut feel ’ and the rest of the team just play along. Based on a number of different surveys and studies, it is evident that still a majority of key decisions are influenced by managerial judgement.
Being empowered with insightful data is the right weapon to beat the HiPPO effect. The whole idea is to be data driven, becoming very objective, using the advancements in technology to change the expert based mindset to be very dynamic and responsive to rapidly changing market conditions and customer preferences. From the executive management’s commitment towards digitizing processes to enabling a cross functional workforce and having a data-driven workplace culture, there’s are numerous things that go into digital transformation and driving decisions based on data
What customers want and how data analytics help
With the advancements in technology, traditional processes are now evolving into customer experience centric processes which ultimately is the motive of any given digital transformation initiative. In a time where micro personalization has taken over services, deep data intelligence can reveal what customers want, the problems they face and their thinking process; all of which are priceless for an enterprise.
The obvious idea is to take care of your customers’ needs and in that way build customer satisfaction across all of your customer segments. It’s a known fact that satisfied customers spend more and frequently, which has a ripple effect on your costs, revenue, employee retention etc..
Customers nowadays are ever more demanding and expect their wants to be met quickly, which requires companies to have super fast processes and systems in place to respond to customer needs without any delay. The focus over the years have changed from cutting costs and optimizing processes to becoming more customer centric. This also mandates the need for all departments to function as one single organism rather than independent departmental silos, to ensure all processes are aligned towards one single goal and vision.
Data Analytics a key driver
With an arsenal of the right data, enterprises can put together efficient strategies primed towards business goals, fine tune the delivery of the business benefit , and clearly define the KPI’s of the proposed investment before going all in. Apart from increased revenues and cost efficiencies, data insights can also help in changes in customer behavior, discover operational and demand patterns, and so on.
With everything said and done the toughest job is to extract meaningful insights from the continuously piling up data and then being able to put everything into action.Before a company embarks on the journey to enrich it’s decision making process using data; it has to ensure data quality, data standardization, data warehousing etc to be put into place.
Conclusion
To be in the fray and stay afloat in today’s market, companies need the capability to respond quickly to rapidly changing customer preferences and operational changes all the while measuring and quantifying investments as well as returns. Data intelligence demands commitment, patience and collaboration from all departments and really is a long term journey starting right at collecting all data that is possible from all sources and then finally returning insights to the concerned department.
Obviously data by itself cannot tell you what has to be done but it gives you the markers and indicators to help you make decisions. So it becomes critical you have people who can help you identify the patterns and then delve into business decisions based on the data. It is critical to humanize the data and make it open for processing. The ideal way is to make data driven decisions a part of your enterprise day to day culture that will make the whole process more acceptable across all levels and ultimately drive the bottom-line.