Creating Value From Data — An Alternative Approach
We live in an era of data. Every second, an enormous volume of data is created, stored and exchanged. Covering everything from global flight traffic, financial transactions or to your Netflix binging patterns.
It is no secret at all that information can be taken and translated into value by businesses. Yet, it seems that only technological giants and innovative startups have found the right formula to do so.
More traditional and established companies often watch this data revolution from distance, failing to turn this opportunity into growth. Unlike the often younger, agile and technologically more enabled counterparts, their ability to become data-driven is limited by a range of ingrained organisational roadblocks. Anything from deep data-silos, aversion to change, missing resources, mindset, and the list goes on.
Despite these constraints, a great deal of companies is still bravely aspiring to join this data-bandwagon. However, to the surprise of many, the transformation necessary cannot be achieved by sudden, hasty projects built on a greenfield. Undertakings, such as hiring a team of consultants to implement expensive company-wide technological solutions, are very common but doomed to go up in smoke.
While I agree that technology is a necessary enabler and company-wide changes are absolutely crucial, we recommend a different approach. A successful data-driven transition should start as an internal value-oriented initiative which works its way outwards. Taking advantage of existing assets and using them to generate value right from the start and throughout the transformation. This way, the focus lies on critical success factors and stops ill-timed investments and changes with low ROI.
If this sounds like an approach that your company can agree and afford to do, here are five imperatives which you should embrace right from the beginning:
(1) STRATEGY ALIGNMENT: First thing first. It is crucial to define your ambition and how it is aligned with the overall business strategy. This is best to be done in a cross-functional workshop.
(2) INTERNAL RESOURCES FIRST: You may be sitting on gold. Identify existing talents, best practices, tools or pockets of knowledge and put them in use. Make sure to cover the whole value-chain while looking.
(3) VALUE FROM THE GET-GO: Walk the walk. An essential ingredient is an actual value generated. Identify where first and make sure to focus on providing value right from the beginning or you might lose internal traction and the support of leadership.
(4) DATA WITHIN & BEYOND: Know your ingredients. Do the legwork and pinpoint all the data available, easily available or high-value data which is unavailable. Do not limit the search to first-hand data and identify potential partners.
(5) PILOT PROJECTS TO LIGHTHOUSES: Start early, start smart. Identify and prioritise first pilot projects with pragmatic objectives and clear benefits. Observe the process closely and be ready to build lighthouse projects for the rest to follow.
Turning a company into a well-oiled data-driven machine is a long-distance race. The recommendations above will help will kickstart this process and create rock-solid scalable foundations.
