What is a data-driven company?
The basic idea of the data-driven enterprise is that with data, management decisions are better and faster informed by real-world facts than without it.
What is the challenge of the data-driven enterprise?
In traditional corporate operations, corporate reports are presented in a time-delayed, aggregated format at management meetings. Aggregated data allows for different interpretations, which slows down and adds uncertainty to the decision-making process. Data-driven management greatly reduces interpretation disputes, allowing management to gain a faster and deeper insight into key processes in the company, and thus to react timely and make better decisions.
What are the main steps?
To build a data-driven enterprise, 3 main areas need to be developed:
- Build the data infrastructure. Most companies already have computer systems in place, all of which store some form of data about a company process.
- Data literacy. Hire or train people who are familiar with the basics and concepts of data science, so that they understand both the needs of the company's business/technology managers and the language of data specialists, so that they can effectively lead data science projects.
- Data-aware leadership. Data-driven leadership is a disciplinary shift in the lives of leaders. A thinking framework based on previous experience and intuition needs to be complemented by an interpretation of the facts represented by data. For most managers, this is a long learning process that needs to be carefully planned.
What outcome can we expect?
Data-driven operations is an ever-evolving process, with management having insight into an ever-wider range of company operations almost immediately. The company can react better and faster to changes in its environment and operations than it can with traditional, delayed information conveyed through the interpretive filter of its employees. It creates a more competitive operation that can react faster to market needs and changes.
How long does it take to set up a data driven organisation?
To at least see key data, it helps if your critical processes are digitised so that the data is available. It takes 3-6 months to turn the data into proper reports or data products. After that, the development of data-driven operations in management depends heavily on the expectations and practices established by the lead manager.
For what companies is it worth setting up data-driven operation?
Making decisions based on facts is beneficial for almost every company. The bigger a company is the farther the decision makers are from the real processes, the more people’s filters distort the information, therefore the more valuable it is to build a data-driven operation to maintain quality management.
What is a data product?
A data product is a computer application where it is possible to see all the data in a given business area at different levels of detail, analyse it, discover new correlations, run possible future scenarios, and test forecasts.
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