We hear a lot these days about the many ways that data is changing virtually everything–how we live, work, and play. Research has shown that companies embracing data-driven decision-making enjoy 5-6 percent higher output and productivity. And according to Richard Joyce, Senior Analyst at Forrester, “For a typical Fortune 1000 company, just a 10 percent increase in data accessibility will result in more than $65 million additional net income.”
Is your company data-driven or data-detached?
Imagine a scenario in which your team lost access to your data for a full day. Would anyone notice? Would it be uncomfortable? Annoying? Disruptive? Intolerable? What about for a whole week?
If you answered “no” to most or all of those questions, you likely have data and use it regularly but not in ways that make it essential to your daily processes. If you answered mostly “yes,” losing access to data would be highly disruptive and even painful because it has become essential in everything you do.
Despite the attention paid to it, many companies are not making progress toward becoming more data-driven. In a study published in 2019 by NewVantage Partners, 72 percent of survey participants—primarily C-level executives—stated their organizations had not yet forged a data culture. Furthermore, a clear downward trend was evident in the percentage who had created a data-driven organization: 37.1 percent in 2017, 32.4 percent in 2018, and 31 percent in 2019.
What is a data-driven culture?
First, having data-driven culture means placing data at the center of decision-making and not blindly following numbers. It requires a reliance on advanced interpretation skills and critical thinking. Organizations with a data-driven culture use data to generate insights which, when leveraged effectively, drive faster and smarter business decisions.
Most importantly, a data-driven culture cannot be bought and installed; it must be cultivated. BARC (the Business Application Research Center) points out the necessary conditions:
- Access to data
- Governance of usage and quality of data
- Methodological knowledge about how to analyze data
- Appropriate technologies to prepare and analyze data
When all employees are empowered to use data every day to optimize processes and support decision-making, it promotes collaboration among teams and fosters data democratization, relieving information gatekeepers and eliminating bottlenecks.
How can departments help foster a data-driven culture in your organization?
While data scientists and marketer researchers are often involved in promoting the value of data and insights across their organization, building a data-driven culture isn’t the job of any one person or department. It requires team members and decision-makers across the organization to recognize the value of the insights that come from data analysis. Gartner identifies three areas of influence on which to focus:
- Identify and communicate the business value of data
- Address the cultural change impacts of a data-driven approach
- Manage the ethical implications of data and analytics
Data strategy consultant Brent Dykes offers another framework that focuses on the four pillars of a data-driven culture: mindset, skillset, toolset, and dataset.
- Shift the mindset: secure executive buy-in and sponsorship, score some quick wins, and institute experimentation (test and learn) as standard operating procedure.
- Strengthen the skillset: build on team members’ domain knowledge and expertise by training them in data literacy and storytelling, and providing data trainers and coaches where needed
- Sharpen the toolset: establish a common data language across the organization, implement a self-service model, automate the labor-intensive tasks that do not really need people, and integrate tools into existing processes, e.g. leverage dashboards as meeting agendas.
- Solidify the dataset: keep analytics tools closely aligned with business strategy, implement data governance that balances access with oversight, and ensure everyone realizes their own role in maintaining data privacy and security.
Be prepared for challenges
Even when the organization and employees are on board in theory, there will be points of resistance that need to be navigated and negotiated. An overarching issue is helping business users understand data as an asset rather than a byproduct. Everyone needs to grasp how insights generated by analytics connect with the problems they are trying to solve for the organization. That is where the value of being data-driven resides.
Another common challenge is that different sets of data may “belong” to different departments or teams, including information technology (IT), data science, or market research and insights. Often, data is not centralized and therefore not accessible to employees who need it. It’s critical to eliminate data silos and consolidate all the data where every employee knows where to find it.
Along the same lines, data may not be in the right format or of adequate quality for the analytics that will be performed. That makes it necessary to develop format and quality standards and bring existing data “up to code.”
While not everyone needs access to raw data, organizations should have a centralized platform that all internal stakeholders can use to access finalized research reports and insights. This eliminates the issue of silos and allows decision-makers from across the organization to benefit from research findings, even if they don’t have a background in market research or data science.
The role of market research and insights teams in promoting a data-driven culture
Market research and insights teams are in a strong position to support a culture of data and insights sharing. If your company has not yet committed to a data-driven culture, your market research team can still adopt protocols and processes that point in that direction and can produce some of the same benefits.
Linking insights from analytics with strategic business issues should be part and parcel of what you already do. It’s a short and logical extension to recognizing data in general as a valuable asset, which the market research team can encourage at every opportunity.
Model successful experimentation, especially if you are using agile project designs. Embracing the “test and learn” approach becomes more comfortable for more departments as they see it in action.
Cultivate strong data literacy and storytelling skills within the market research team and be prepared to encourage and even coach other teams who find it appropriate to develop their own competencies in those areas.
Within the realm of market research and as far beyond as is practical, standardize data formats and quality levels. Create protocols for curating data that facilitate self-service access and use by everyone in the organization. Find opportunities to integrate analytics tools such as dashboards into everyday processes.
Take the lead in developing solid policies governing data privacy and security. Reinforce the understanding across the organization that safeguarding data is everyone’s business.
If you use a knowledge sharing platform, then you likely have in place some of these best practices pertaining to a data-driven culture: standardization of formats and quality requirements, democratization of insights via org-wide access, and strong, consistent governance policies. If you have not yet added a knowledge sharing platform to your toolkit, it can be a great place to begin ramping up to a fully data-driven culture.