Data, Data Everywhere, But How do we Use it?
Today, each organisation produces a humungous amount of data. Companies today are also more tech-savvy than ever before and are investing in data analytics and business intelligence solutions to gain actionable insights from the data.
Despite all this data, organisations today struggle to define the direction that their business should take. Despite having data at their disposal, companies seem more unsure than ever about the future. More often than not, data is used to retrospectively explain why certain company goals could not be met; rather than as an enabler for growth. What is the reason for this contradiction? One key reason is that organisations may be using data to answer the wrong questions.
The Decision-Making Construct
All organisational decisions are governed by three questions – Why, What, and How.
The Why question is what provides the fundamental raison d’être or purpose for any organisation. It helps defines the direction and points us to the North for the business. The What defines the things that we need to do in order to reach our goal. The How defines the tasks that we need to take up in order to achieve the What, which eventually rolls up to the Why.
The problem is when organisations try to use data to arrive at the Why. If you don’t know which direction is your North, then no amount of data is enough. You cannot choose your Why simply because data supports it. Instead, it needs to come from a much deeper place determined by your overall outlook, beliefs and vision. Like Simon Sinek explains beautifully in this TED video, if you don’t know why you do what you do, then it is almost impossible to build any relationship with your clients and customers that goes beyond the transactional.
For example, if your only reason for launching a particular product is because the numbers show that there seems to be a market for it, be prepared for an extremely commoditized marketplace. In this scenario, building a strong brand that commands loyalty is almost impossible.
Once you have absolute clarity on your Why, you can then use data to cull out your What and How. Again, What is also a mix of the qualitative and the quantitative, so it needs to be treated as such. The How is the only part of the business that can be driven by data.
When you ask the right questions, your data can emerge as a true enabler for your business.