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6 Ways To Make Your Company Data-Driven
Rich Wagner, president and CEO of Prevedere, shares six guidelines he's developed based on his own experiences seeing good data left to waste at major enterprises, including the Fortune 500 chemical company where he once worked.
July 11, 2016
4 Min Read
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Executives around the globe are demanding their organizations become more data-driven, and for good reason. The Economist Intelligence Unit found data-driven companies rate themselves substantially higher in terms of financial success than others do. In my experience, this new data-driven mantra is easier said than done.
Executives often don't realize what they are asking of us in IT. That's assuming they know to ask the right questions at all. In fact, another EIU study found 35% of executives lack an understanding of how to apply big data, and 62% of CIOs report big data buzz has resulted in unrealistic expectations among executives.
IT teams are still adapting to functional users demanding answers at the touch of a button, something they've come to expect because of Google and the proliferation of smartphones. So, what's an IT professional to do? Based on my own experiences, as well as the work I've done with other organizations, I've developed six steps that can transform companies into data-driven enterprises.
[What's hot in data science? Read 10 Programming Languages and Tools Data Scientists Use Now.]
Look forward, not backward. Leading IT strategy and innovation at a Fortune 500 chemical company, I came to the disheartening realization that the business intelligence reports my team worked so hard to produce were going unread and unused. When I dug deep to find out what would make them more valuable, the answer was the same across business functions.
In fact, I found a common theme as I looked at the broader business environment, even across companies: Executives needed to know what was going to happen, not what had already occurred.
Determine the question. Before searching for answers, it's critical to know what key questions your data should answer. Most commonly, the customers I speak with are looking to determine the following:
What drives demand for our product/service/industry?
Are prices and availability of our raw materials/supplies expected to change in the near future?
Are regional factors affecting our sales and profits?
How does my internal forecast, which is based on historical performance, match up with external trends and factors?
Rethink your data sources. Now that you know the answers, you need to find, take a hard look at your data sources. Many companies I've worked with are basing their forecasts only on historical data. Or, they're incorporating one to two external factors seemingly (but not certainly) related to their businesses.
In my work with clients, I have found nearly 85% of a company's performance is dependent upon external factors, so these forces need to have a heavier role in business planning.
Don't go it alone. Millions of data sources are available. Weeding through them all to find the ones truly affecting your company may seem like a daunting task. Integrating those insights with your existing data, and putting the results in a format functional users can digest is even more of a challenge. But it doesn't have to be so difficult.
IT teams don't need to create these systems and processes internally. New solutions leveraging the power of big data, predictive analytics, cloud computing, and in-memory computing can make becoming a data-driven organization less burdensome to IT.
Automate. A truly data-driven enterprise needs to have real-time, constant insights in order to make reliable decisions as part of the planning and operations process. The old consulting model of answering point-in-time problems is gone. Data-driven processes need to be automated, systematic, and repeatable -- and with today's technology, it's no longer an impossible challenge.
Mind your presentation. Business users are not only demanding data-driven answers; they are demanding these answers as part of their existing processes. Answers need to be presented within current systems, without requiring people to learn and adopt a whole new platform.
Those answers must be presented in the way that business users can and want to consume them. Think high-level insights, short, digestible snippets, and lots of graphics -- all of which must render well on a tablet, phone, or laptop.
Today's business environment is undoubtedly volatile. We're seeing disruption in every industry and vertical. Companies with the ability to make decisions well in advance of changing times will be the ones able to succeed.
Likewise, traditional IT processes are being disrupted. Business users are now looking for self-service systems to give them the answers they need, when they need them.
IT teams able to meet this disruption proactively will help their companies transform into organizations data-driven cultures adept at identifying opportunities, avoiding risks, and succeeding in an ever-changing economy.
About the Author(s)
President and CEO of Prevedere
With an extensive background in IT strategy and innovation, Rich Wagner has seen first-hand the power that external big data can bring to a company's financial performance. Today, as president and chief executive officer at Prevedere, Rich helps industry-leading companies like RaceTrac Petroleum, Masonite and Brown-Forman to look beyond their own walls for key external drivers of financial performance. He has uniquely positioned Prevedere as a complementary solution to existing forecasting platforms by tying the right external economic factors to corporate performance. Combining the power of big data, machine learning and predictive analytics, Prevedere drives unprecedented forecast accuracy. Under Rich's leadership, Prevedere has been named a "Cool Vendor in Information Innovation" by Gartner and an FP&A Innovation Awards winner in Forecasting and Planning. To learn more, visit www.prevedere.com.
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