If your company is like most mid-to-large size companies today, your analytics spend is high and climbing. The pressure to keep up with the newest technologies is almost crushing, especially in the face of abundant data showing that companies with mature analytics technology outperform their competitors. There's an analytics arms race out there, and it often seems as if there's no end in sight until every last dollar is spent.
Do you need to participate in the arms race? Yes and no. To be sure, you need sophisticated, mature analytics capabilities, but you don't need every new analytics toy that comes on the market. Instead, you need to right-size your analytics capabilities now, and for the future.
To get the right analytics program for your company, first you need to figure out where you are. Do you still perform analytics via spreadsheets? You'd be surprised at how many companies do. Many have climbed the maturity ladder a bit and begun to integrate their data sources and give decision-makers some data visualization capabilities. They can get hindsight, and some rudimentary insight, but their capabilities could be more robust.
Increasingly, forward-thinking companies are making the shift to implement predictive capabilities and advanced visualization technologies with real-time dashboards so management can keep its hand on the pulse of the business and achieve real insight into what's happening. They're moving to eliminate data silos and analyze multi-structured data to get a more holistic picture of their operations.
Cutting-edge companies go further, however. They've realized the power of analytics to help them leap-frog their competition. These companies have adopted an analytics mindset where analytics, not gut feel and experience, drive decision-making. They're investing in technologies that give them the speed and flexibility to make decisions more quickly than their competition does. This is where you want to be.
But how do you get there? What do you need to grow up analytically? It starts with defining what you want. It sounds simple, but it's not. It requires a 360-degree look at your business — where you are, what you want now, and what you'll need in the future. Define those outcomes that will have the highest impact on your future. Align your analytics goals to achieving those outcomes.
Next, define the low-hanging fruit. What can you implement quickly and cost-effectively to achieve some of those outcomes? Pick one high-impact area and implement a pilot or proof-of-concept that will show quick value and return.
Identify the data sources you'll need — both for the pilot and for the future, to the extent possible. Think ahead as much as you can. It's critical to think outside the database box and include multi-structured data that covers the customer and supplier touchpoints that show you a clear picture of how you're operating and what your customers are saying and doing.
Once your data is set, define which analytics capabilities you need to implement the pilot — with an eye toward what you'll need in the future. You'll need advanced visualization and dashboard capabilities, as well as predictive and prescriptive modeling tools.
Leverage a cloud-based platform to get fast, reliable service and free up your own IT resources to focus on producing the analysis that will achieve your high-impact outcomes, rather than managing a byzantine IT infrastructure.
However, what you need most to grow up analytically is a shift in your mindset. Experience is nice, but as they say in those ubiquitous lawyer ads, past experience does not predict future performance. Data does. What you did last year is relevant, but you need to couple it with how you're performing now, and with sophisticated modeling techniques that enable you to predict the future, AND that will tell you what your next moves should be to achieve your goals.
In short, you need to morph into a data-driven organization. Rely on those high-tech tools you purchased and trust their output. If your input is right — meaning that if you've fed the analysis tools with clean, reliable data — they should do their jobs. Thus, data should drive every decision you make. If the numbers aren't there, don't pull the trigger, or pull a different one.
Just do it
Achieving analytics maturity won't happen overnight, but you can do it. Scope it; pilot it; get the data; get the tools; and develop the mindset. Pick a good technology partner and make the investment. You won't regret it.
Mar 23, 2021