Building Your First Analytic Team
Or how to avoid getting lost on an island…
So your company is ready to invest in hiring their first analytic team? Great, so you have half-million dollar problems! Wait… you don’t? Then what are you hiring an in-house team for? Maybe you just aren’t sure?
Problem #1 — understand the size of the opportunity you seek to address by hiring an in-house team. I always wondered why those seven castaways ever got on the same three-hour boat tour… the demographic was all wrong.
Here is a little secret. If you don’t have half-million dollar problems, don’t hire an in-house team. If you are sure they are bigger, get them hired and task them with calculating the full stack of opportunities.
But I have a $100K problem, surely I can hire a junior analyst to… just stop. If I had a proverbial nickel for every junior analyst hired in this fashion, who was later pronounced to have “fit issues” — I would need a very large bag to hold them because nickels and lone junior analysts are both worth very little.
Problem #2 — it takes more than two people to get an analytics team off the ground. When ever the Professor, the Skipper, and Gilligan worked together on the island — they had great success. What was he doing during the storm? Perhaps he just felt like ‘the rest’?
Analytic teams require at least three members to function with any level of effectiveness. Don’t try anything less. It is why it is called a team, not a duo or some other such silliness. Our three castaways actually make a nice model here.
By default now, you are looking at a $300K investment or more, likely more. So now my half million dollar threshold should make more sense.
Problem #3 — someone better be calculating ROI. If you aren’t better at this than the Skipper was at calculating Latitude, you are doomed to failure.
Analytics needs to be ROI positive. It won’t be on day one. But within 90–120 days, you should see a clear path to profitability. Analytics is an investment, a recurring one. If you are coming out ahead early, you won’t be able to provide further support to take on emerging opportunities.
Further, ROI creates discipline. Undisciplined analytics is a topic for a Sherwood Schwartz and some campy CBS writers, not for your growing company. I personally believe that at least one of your analysts should be capable in this space, but I have seen it done via finance or executive support (but do they have time for that?).
Problem #4 — have a plan. You just can’t tune in each week and see “what are they up to now?”
Plans change, but you need them. You need them from an organizational standpoint, an investing standpoint, and for general planning. If your fearless crew doesn’t know where it is going, nothing good will come of it.
Problem #5 — hire well. Did anyone talk to the crew before boarding the Minnow? Ten minutes with Gilligan and I am picking a different boat.
The 60’s was long before yelp, but better hiring could have saved our castaways a lot of anguish. Only thing is, none of them had sailing experience. Who will hire your analytics team for you? Does your company have experience in the space? You are going to need to leverage someone who does. Hire a service.
Problem #6 — plan for turn-over. Three years on an island with few supplies and no one died… a little unlikely.
If you are debating hiring an analytic team, your company is NOT predicated on data and analytics. You won’t have career paths, multiple locations, or the other amenities that create longevity in an analytic team. Perhaps you are nearing IPO, that might help. But if I had the proverbial nickel for every analytics departure I saw even in the months prior to IPO… well, life happens.
Problem #7 — feeling stranded? So join us here each week my friends. You’re sure to get a smile, from seven stranded castaways here on Gilligan’s Isle. Only in a TV sitcom…
Here is another major secret — you don’t need to hire an in-house data analytic team. They don’t scale early on. It takes a dozen or more analyst to create a stable environment and you need multi-million dollar issues to justify that.
I am not saying you don’t need support. I am not telling you to send it overseas… please don’t. Talk about a fateful trip. I am saying that you don’t need to build it yourself. Hire a service. Services scale. Services have experience, support, and a plan (the good ones). Services sell on ROI (the best ones). And a great service will also help you scale — to your own in-house shop when the timing, opportunity, and needs are right.
Even if you just want to do it yourself. A good analytic service partner can help you do it right, by providing hiring, training, planning, and outside oversight. Truth in blogging — I am the founder of such a company. Perhaps that makes me bias. I spent over two decades building shops for start-ups and Fortune 500s alike. That definitely left me bias… or as I would categorize it — well informed.
So don’t spend three seasons dealing with new dilemmas each week. Don’t put yourself in a position where you need to be rescued. Size the problem, source a true team, know your ROI, have a plan, hire well, plan for turn-over, and don’t be afraid to get some help. Your company does not need to feel stranded.
