Embracing analytics is a good start, but it’s not enough

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Nearly three-quarters of large enterprises already have benefited from big data and artificial intelligence (AI) initiatives, according to a survey published early this year in Harvard Business Review.

Among those benefits, write co-authors Thomas Davenport and Randy Bean, are better decisions through advanced analytics, better customer service, lower costs, and innovation. However, only about one in three of the surveyed enterprises (drawn from several industries, including financial services, manufacturing, and telecommunications) say they’ve established a data-driven culture.

There’s a lot that goes into creating a data-driven culture, but three essential ingredients are 1) buy-in from top decision-makers 2) a clear data strategy (including specific business objectives that can be measured), and 3) clearly defined roles and responsibilities.

While large organizations have established new data-related management roles in order to foster a data-driven culture, Davenport and Bean write that “there is still a lack of clarity about how different data-oriented roles (chief information officer, chief data officer, chief digital officer, chief analytics officer, etc.) relate to each other.”

That’s a recipe for confusion, infighting, and failed data and AI initiatives. And it underscores something else: For all their human and IT resources, large enterprises are like aircraft carriers in that they resist sudden changes of direction. Smaller organizations, in contrast, are much more nimble.

“Many startups have created data-driven cultures from their beginning, which is a key reason why large, established firms fear disruption from them,” Davenport and Bean say.

Data-driven cultures also must reach across and down the enterprise. You can’t just hire a chief data officer and some data scientists; all employees should understand the importance of data analytics.

One way to ensure employees are immersed in a data culture is to “un-silo” data analysts and scientists so they collaborate with other employees on specific projects. Using an integrated, team-based approach to analytics can help keep the focus on specific business challenges. Without the perspective of relevant enterprise stakeholders, analytics programs can lose momentum.

Bottom line: Whether you’re a large enterprise or a scrappy start-up, a data-driven culture will allow you to better leverage the growing amount of data generated by customers, personal devices, the Internet of Things, and other sources. But it’s up to you to build one.

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