Executing Data Driven Decision Making - Using a New Muscle
Last Tuesday, we started to address what was necessary to shift your organization to be more data driven in its decision making and how implementing an Analytics Foundation Strategy helps. The post looked at what was needed to make this progression possible, and how tools, like the OAMM and analytics audits play a part.
This week, we will cover off where to go with what you learned, and how it fits together as you start to exercise the decision-making muscle with the use of available data.
Following the Audit and the OAMM that we discussed last week, you should next spend time with your management team (at a level appropriate to your organization). Here, you should review the results of the Measurement Audit, and ask them to see if they can find anything missing from perspective. This would provide a side benefit of underling conversations with the use of data and measurement as the new way to drive change in all aspects of decision making, and getting their buy-in. You are trying to get folks in leadership to trust the data and the process of using it to make decisions. Once leadership is on board with this approach to decision making, the rest of the organization should more easily follow in behind them.
I might be inclined next to schedule a kick-off workshop for all departments on data from all the sources in your organization that make sense (analytics, e-commerce, customer satisfaction, etc.), and decision making that focuses on 6 areas:
- Education – what is measurement and analytics and why should I care
- What is currently being measured (based on audit)
- Brainstorming ideas of decisions that are currently being made without proper data
- Establish processes for: Requesting Data – Requesting New Measurements be set-up – Accessing Data
- Discuss KPI’s and set the stage for the roll-out of a new company dashboard after some homework is completed by these key stakeholders
- Workshop KPI’s with the group and come up with a list of 5 to start with
The development of a new organization wide dashboard with drill-down departmental sub-dashboards could be rolled out now to ensure the right people have access to the right data. Here you could socialize the KPI’s organization wide and each department would discuss their own KPI’s in separate meetings. The goal would be to display KPI’s that matter to each department in a visible way so everyone sees them on a regular basis. Example: lobby television screens, etc
As a follow-up to the workshop, you might want to consider creating a toolkit for each department to help them request and utilize data more readily in their presentations, business cases, etc. You are trying to reduce as much as possible, any friction to the broad organization from accessing and using data in their work. This includes considering how you will staff which ever team is tasked with pulling data together upon request.
Old Habits Die Hard
While it is easy to make judgements on what has happened in the past, being able to make timely and effective decisions based on available data is never easy. Many organizations have been and are quite effective at delivering results with a narrow focus of analysis by a few people. Changing this process needs to be mindful of the personal implications it has for those directly and indirectly involved.
Four identified potential challenges that often come up during a change in the way decision making happens are: trust, habit, data, and competency.
The first challenge to be addressed relates to the acceptance of the organization to do things a certain way – and then having it change. There is often i) trust in both the relationships and the processes of the past. It is critical that management in particular can articulate their own trust in the new strategy, and get everyone else in the organization to see this loud and clear.
ii) Habit is hard to change and so the challenge to any new strategy or process is to continuously reinforce the change, but be mindful that you need buy-in, not the robotic following of steps. Being open to the fact that people may revert to the old strategy, and turn these moments into a learning opportunity where instinct and data can be married together to make better decisions. This challenge requires a combination of training, moral suasion and direct enforcement of new processes to overcome any fear, heel dragging or opposition.
iii) Data or analytics / measurement collection is sometimes carried out in an adhoc and unorganized manner, across multiple teams and business processes or channels like websites, etc. Until a comprehensive strategy is applied to the coding and analysis of these channels, there will be considerable gaps in tracking that will render efforts to calculate KPI’s, etc. difficult. The audit of the measurement of these channels is important for any organization and possible with proper resources and open communication to break down any data silos. Resolving this challenge comes from managing more closely, the measurement process, training and hiring.
iv) Competency relates very much to the 3rd challenge noted – and is split into two. The first is the technical competency required to properly set-up and ‘code’ channels for measurement. This includes working with the various technical and business teams to set measurement up. For example – working with the website development team to set up a data layer on the page with connection to Google Tag Manager / Google Analytics. Technical competency around planning is a challenge that needs to be overcome through hiring and training. The same can be said for the second competency – data analysis. Understanding the data and being able to tell stories – both in response to issues and proactively – are critical skills and approaches to delivering value to the organization. The element of competency also relates back to trust. The team needs to have trust that those collecting the data can do so accurately.
Decision making is a fundamental activity that takes place every day in organizations of all types. Making sure data is available and trusted for relevant parties to make these decisions is more important than ever - and needs to be available at ever faster speeds. Following these steps and getting all the relevant stakeholders on board are necessary to get your organization lined up for making this shift.
An interesting article on the psychology of decision making and gut vs informed can be found in this Psychology Today article by Carlin Flora, Gut Almighty.
I could have gone into more organizational behaviour discussions for these two posts and talked about how individuals respond to decision making stresses and rewards. I am not an OB expert and do not pretend to completely understand the psychology behind decision making at a level needed to bring justice to this.
If you have any questions about this or other posts, please do not hesitate to let me know.