Across the entire business, the predominant focus lies in implementing data-driven decision-making processes. Applying the potential of technology, advanced analytics and data, combined with human power to generate smarter decisions.
Despite the benefits, many businesses fail to deliver what they regard as a measurable value from their data. A study by Accenture recently discovered that only just over 30% of businesses report tangible and clear value from their data.
Researchers from the MIT Sloan Management Review explained that many businesses tend to focus on finding a purpose for data available or extracting information from the information they have to hand. This results in creating answers to the wrong questions or possible misleading insights. A more effective approach to take is applying decision-driven data analytics. This involves emphasising the decision that needs to be made and then working backwards to explore what data will be best to deliver for that particular goal.
Data-driven decisions often place too much emphasis on the data but fail to consider how the information is generated and result in individuals reaching inaccurate conclusions. The second problem encountered is that people tend to ask the wrong questions.
Don’t wander off with your data. Creating a plan and initiative based on the data available can lead to focusing on the wrong questions and reinforce certain feelings within a business. Staying focused on the available, generally historical data will often result in decision-makers taking the wrong path and ultimately gaining insights into areas that don’t focus on the fundamental challenges a business may be facing.
Assign the right people. Most data plans are managed and operated by data scientists, who have a solid understanding of data processes but they may not be ideal at understanding the core problems of a business. Ensure data and analytics plans include other people who have a strong understanding of data and a familiarity with the business goals to enable an effective combination of the two.
Create a plan and succeed. Decision-makers in a business need to determine the right course of action for each challenge they face. They should work out what information is required to assess all possible options and use the resulting analysis to choose the best course of action.
Analytics and big data have proven to be valuable in supporting business insights, but people need to remain in control of the shaping of their business plans.