2. “Just the Facts, Ma’am”:
What Makes Data-Driven Organizations
Better?
Ray Major, CEO
Halo Business Intelligence
@Halo_BI #HolisticBI
3. What makes them better?
• Leverage data to:
– Create better products
– Increase user experiences
– Improve fraud detection
– Maximize Marketing campaigns
– Anticipate supply/demand conditions in different
markets
– Risk mitigation
– Have better dialog with customers
4. Agenda
• Humans need for Data
• What does it mean to be data driven
• How companies benefit from being data driven
• 5 Steps to becoming data driven
7. Decisions drive business
500 Number of decisions made
by an employee per day
X 100 workers
= 50,000decisions per day
X 200 work days per year
= 10,000,000 decisions per year
Decisions require Human Intelligence
? ??
8. Why do we need to be data driven?
Where you have been Where you are going
When something goes wrong When you reach your target
9. Benefits of being data driven
Drive STRATEGY and direction of the organization
Provide FOCUS for: the organization, department,
or individual
Help make
DECISIONS
Drive
PERFORMANCECHANGE and evolve with the organization
10. The problem with Business Intelligence
8out of 10 2out of 31out of 12
Not achieving desired goals Have achieved anticipated ROI Need to improve
analytic capabilities
12. Being Data Driven
Data concentrated
in the hands of a
few individuals
Data used by
small groups of
people or
departments
Data integrated
into day-to-day
corporate
operations and
decision making
Data utilized by
corporate
ecosystem of
suppliers, vendors
distributors and
customers
DATA-DRIVEN MATURITY“Not” data driven Data Driven
“Siloed” “Enterprise”“Departmental” “Ecosystem”
13. Data-driven Decision Management
is an approach to business governance that
focuses on gathering data and analyzing it
to guide corporate decisions at all levels
within an organization.
14. Attributes of Data-Driven Companies
• Believe companies, not employees own the data.
• Shared data should be used by as many
employees as possible
• Make data collection a primary activity across
departments
• Have buy in from the top
16. Where do Data Driven Organizations see benefits?
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
Increased
Productivity
Cost Reduction Faster Decision
Making
Program
Improvements
Improved Financial
Performance
Siloed Users
Enterprise-wide
Users
Source: Harvard Business Review 2012
17. Data Driven Cultures
Mandate the use of analytics
7% 87%
0% 100%
Use the right metrics
12% 80%
Promote Decision-making transparency
59%23%
0% 100%
0% 100%
19. Benefits of being Data-Driven
year over year increase in:
• 34% operating cash flow.
• 42% operating profit.
• 41% organic revenue.
nearly 4 times
the industry average
Source: Aberdeen, 2011
• 40% sales pipeline.
nearly triple the industry average
• 20% return on mkting investment
more than double the industry average
• 94% customer retention
• 96% employee retention
23. Tying data
to metrics
Corporate Goals
Critical Success Factors
Corporate KPIs and KRI’s
Business Processes
Data Sources
Business Level Metrics
(PI’s and RI’s)
24. Business Level Metrics
(PI’s and RI’s)
Improve customer service
Increase customer retention rate
• Faster problem solving
• More Information online
• Less Phone wait
Monthly customer churn rate
• Target 24 hrs for resolution
• 20% per month for 5 months
• 2 minute average wait time
• Calculation from the CRM
• Requires an inventory and plan
• Intercept Phone System data
Corporate Goals
Critical Success Factors
Corporate KPIs and KRI’s
Business Processes
Data Sources
25. Business Level Metrics
(PI’s and RI’s)
Build a raft suitable
to get over the reef
Get off the Island
• Braid 4 25 foot ropes per day for 30 days
• Collect 10 coconuts per day
120 lengths of 25 foot ropes
Collect 100 coconuts
• Braid one before lunch one
after, two in the evening
• Collect 10 coconuts per day for
10 days
• Local vines
• Coconut trees
Corporate Goals
Critical Success Factors
Corporate KPIs and KRI’s
Business Processes
Data Sources
26. 5 STEPS TO BECOMING DATA DRIVEN
Parts of the following section of the presentation draw from:
The Intelligent Company: Five Steps to Success with Evidence-Based Management,
Bernard Marr, 2010
28. Which road do I take? She asked
His response was a question:
Where do you want to go?
I don’t know,” Alice Answered,
“Then,” said the cat, “It really doesn’t matter.”
Lewis Carroll’s Alice in Wonderland
29. 1. What Goal are we trying to achieve?
2. What do we need to know to achieve this Goal?
3. How will we acquire the knowledge?
4. Who are the stakeholders?
5. What do they need to know?
STEP 1: Define Objectives and Information Needs
30. Define Objectives and Information Needs
Balanced ScorecardRobert Kaplan (Harvard Business School), David Norton 1996
Strategic Framework
31. Financial:
Increase shareholders
value
Internal Business
Processes:
How value is created
and sustained
Customer:
The differentiating value
proposition
Learning /
Growth:
Role of intangibles:
People, systems, culture
Revenue Growth Strategy
Productivity Strategy
Revenue from new customers
Increased Share of Wallet
Become Industry Cost Leader
Maximize use of existing Assets
Increase Quality
Rapid purchase process
Appropriate Selection
Increase product options
Outstanding Customer Rel.
Timely Distribution
Improve supplier efficency
Knowledge management
Enterprise use of metrics
Reduce errors per 1,000
One-click shopping
8 vs 3 option packages
Invest in Mkt research/ R&D
Reduce wait time to 2 minutes
Ship within 24 hrs.
Supplier Scorecard
Internal training classes
Data-Driven Initiatives
32. •Strategy/Vision/Mission
•KPI’s. KRI’s, Financials
Executive
Management
•Business Processes
•PI’s Ri’s, machine uptime, customer sat.
Operational Decision
Makers
•Reports and Analytics
•Create Information, raw data needs
Analysts, Controllers,
Report Developers
•Data Gathering/Management
•Accessibility and Usability of data
ETL Developers,
Database specialists
•IT infrastructure
•Data storage
IT Professionals
Informationrequirements
InformationSupply
BI is a layered and hierarchical discipline
•Concerning information requirements:
Underlying layers are subject to layers above
•Concerning information flow
Higher layers are subject to underlying layers
BusinessDriven
Environment
TechnicallyOriented
Environment
Who needs what data.
Define Objectives and Information Needs
34. I never Guess……..
… It is a capital mistake to
theorize before one has data.
Insensibly one begins to twist
facts to suit theories, instead of
theories to suit facts.
Sir Arthur Conan Doyle
35. Collecting the right data
•Determine the right data needed to answer the questions
•Is the data in the right format?
•If not, How do we obtain it?
•Existing data sources? CRM, ERP, POS, etc.
•Surveys?
•Big Data?
•Monitoring processes?
•Quantitative vs. Quality data
Collect the Right Information
40. Human Intelligence Continuum
Researching Absorbing Interacting Reflecting
(Understanding)
Applied Knowledge –
”decisions”
(numbers, facts, figures)
(Interpretation of the data)
(what we know to be true)
Analyze Data, Gain Insights
41. Data to information to knowledge to wisdom
350
6 Smith
0.5
0.5
1.0
0.5
0.5
.25
Cups of brown sugar
Cups white sugar
Tablespoons cinnamon
Teaspoon lemon zest
Teaspoon salt
Teaspoon nutmeg
10 Tablespoons butter
Granny apples
2 1/2 Cups flour
degrees
1 Hr.
Analyze Data, Gain Insights
42. Six Sigma (DMAIC)
• Define Customer requirement (or KPI’s etc.)
• Measure Current Performance
• Analyze data – cause and effect
• Improve Process – fix/prevent problems
• Control Improvement to keep on course
Analyze Data, Gain Insights
44. You can have brilliant ideas …
But if you can’t get them across, your ideas
wont get you anywhere.
Lee Iacocca, CEO, Chrysler Corp.
45. Data cannot speak for itself.
•Present and communicate the information in a
way where the user has exactly what they need
•Pay special attention to determining the most
effective way of reporting and visualizing the
information.
Present and Communicate Information
46. •Strategy/Vision/Mission
•KPI’s. KRI’s
Executive
Management
•Business Processes
•PI’s Ri’s
Operational Decision
Makers
•Reports and Analytics
•Create Information
Analysts, Controllers,
Report Developers
•Data Gathering/Management
•Accessibility and Usability of data
ETL Developers,
Database specialists
•IT infrastructure
•Data storage
IT Professionals
Informationrequirements
InformationSupply
Executive
Dashboard
Grids and Graphs
Slice and Dice/
Drilling
Data Aggregation
Data Structures
BI is a layered and hierarchical discipline
•Concerning information requirements:
Underlying layers are subject to layers above
•Concerning information flow
Higher layers are subject to underlying layers
BusinessDriven
Environment
TechnicallyOriented
Environment
The right information for the right user.
Present and Communicate Information
47. Remember the target audience
• Frame the report with questions
(KAQ’s and KPQ’s)
• A picture is worth a 1,000 words. (or numbers)
• BI tools don’t solve problems, People solve
problems.
Present and Communicate Information
50. Knowing is not enough;
we must apply.
Willing is not enough;
we must do.
Johann von Goethe, author of Faust
51. Holistic Business Intelligence
Data-Driven
Holism
Technology
Culture
Internal
• Executives
• Operational Managers
• Business Analysts
• Information Users
External
• Customers
• Suppliers
• Vendors
• Distributors
Mission, Vision
KPI’s, KRI’s
Score Cards
Data Collection
MDM
Internal Data Sources
ERP, CRM, POS
Syndicated Data
3rd Party Data
“Big Data”
BI Software
Dashboards
Drill thru
What-if
Predictive
Make Data based decisions
Process PeopleTechnology
Cultural Shift,
Supported from the Top
More Business Hard Costs More Business Value
53. What makes Data Driven companies better?
They understand the importance of
empowering the people in their
organizations to make decisions based on
data that is systematically tied to, and
support their corporate goals.
But I think you could have figured that out.
The really interesting question is really is not what makes them better but how do we become data driven ourselves
Humans are metrics driven
We use data to validate decisions
The more, or better data we have, the higher our probibility of making a correct decision
Tom Hanks (Chuck Noland) had a problem.
He was stuck on the island, and after 4 years, needed to get off.
He had spotted freighters going by in the distance,
He needed metrics –
The first metric he needed to survive was simply a calander of how long he was there
The mission/vision – get off the island
The “business Problem” – (how to get off)
He counted Wave Patterns
He needed rope to build a raft
He needed a way too know when to launch his raft, and when it needed to be done
When the time comes, he launches his boat based on the best information he has -- his metrics
The KPI’s – (
The result – he gets rescued.
Could he have done it wo the metrics? Probably not. Success in business like with this rescue reli on us being able to measure and the take action against those metrics.
Where you have been
Where you are heading
Whether something is going wrong
When you reach your target
Drive strategy and direction of the organization
Provide focus for: the organization, department, or individual
Help make decisions
Drive performance
Change and evolve with the organization
Maturity
Disseminate widely
Share KPI’s across the organization
Stress Training
Place analytic professionals throughout the organization
Building from the bottom up is not effective and misses the mark.
More data just creates more dysfunctional data presentations
Most of the reports are really not even connected to the goal. That just makes it “nice to have” or Noise or worse a waste of time.
We need a translation leayer. Those are the metricsNeed corporate buy-in
Understand where you want to go
Need corporate buy-in
Understand where you want to go
Need corporate buy-in
Understand where you want to go
Without knowing what you “need to know” it is impossible to deliver a data-driven decision support
Key Performance Questions (KPQ’s)
Are our customers likely to recommend us to others?
Key Analytic Questions (KAQ’s)
What, When, and Why
Without knowing what you “need to know” it is impossible to deliver a data-driven decision support
Key Performance Questions (KPQ’s)
Are our customers likely to recommend us to others?
Key Analytic Questions (KAQ’s)
What, When, and Why
Strategic framework that adds non-financial performance measures to traditional financial metrics to give managers and executives a more “balanced “ view of organizational performance
Without knowing what you “need to know” it is impossible to deliver a data-driven decision support
Key Performance Questions (KPQ’s)
Are our customers likely to recommend us to others?
Key Analytic Questions (KAQ’s)
What, When, and Why
What gets Measured gets Done
An effective strategy is predicated on the ability to:
Collect
Analyze
Peter Drucker
Not all indicators are created equal
The “I” stands for “Indicator”.
It is an indication of how well we are progressing against a strategic goal and not a goal itself.
Without knowing what you “need to know” it is impossible to deliver a data-driven decision support
Key Performance Questions (KPQ’s)
Are our customers likely to recommend us to others?
Key Analytic Questions (KAQ’s)
What, When, and Why
The numbers are data
The words start to provide information about the numbers
What we know to be true about baking….. Is that this is a pie, not roast duck. Our “knowledge”
Our ability to tie “apple pie” to previous experiences is allows us the wisdom to know what it is and that it is good.
Exploring – investigate the data w an open mind to see what you can learn
Generate hypithisi about causes of problems/ opportunities
Verify or eliminate causes - experiment with options
Without knowing what you “need to know” it is impossible to deliver a data-driven decision support
Key Performance Questions (KPQ’s)
Are our customers likely to recommend us to others?
Key Analytic Questions (KAQ’s)
What, When, and Why
Head line
Narritive
Just the right data measuring what needs to be known
Remember the Target Audience
Who is the target audience?
What do they know about the issue?
What do they expect to see?
What do they want to know?
What will they do with the information?
Frame the report
Tie back to Balanced Score Card
Customer Satisfaction Score
How do our customers perceive our service?
Remember the Target Audience
Who is the target audience?
What do they know about the issue?
What do they expect to see?
What do they want to know?
What will they do with the information?
Frame the report
Tie back to Balanced Score Card
Customer Satisfaction Score
How do our customers perceive our service?
Without knowing what you “need to know” it is impossible to deliver a data-driven decision support
Key Performance Questions (KPQ’s)
Are our customers likely to recommend us to others?
Key Analytic Questions (KAQ’s)
What, When, and Why