In a previous post, I recommended a new approach to Business Intelligence that I called Decision Intelligence. Decision Intelligence directly connects the insights from analytics to decisions. Decision Intelligence improves the quality of the decisions. The business, and every decision, then becomes more “data-driven”.
Simply put: data fuels decisions; better quality data results in better quality decisions; bigger data sets enable more accurate business predictions; and faster analysis of big data sets result in better and faster decisions.
So, which decisions need better data fuel for better analytics? As organizations increasingly appoint new Chief Data Officers (see this post here or this IBM report: Your Chief Data Officer or this Experian report: Dawn of the CDO ) to become more data-driven and agile, it’s vital to establish an enterprise-wide Decision Inventory and use it to determine which decisions generate the most value. In my experience few organizations have a clear Enterprise Decision Inventory.
CDOs are perfectly positioned to partner with their C-suite team to establish an Enterprise Decision Inventory. Based on my experience, I categorize a decision inventory into 3 groups: 1) Strategic, 2) Operational and 3) Organizational decisions.
Let’s look at each briefly….
Strategic decisions set the longer term direction for which Customer and Markets the business competes in, with which Products and Services. These decisions need robust analytics now but the payoff is in the future.
Customer Decisions: Strategic customer decisions include segmenting and targeting different customer segments by the projected lifetime customer value. Predictive analytics require large data sets and complex profitability analytics to decide which customers are most attractive.
Products and Services: Driven by increasing competition to meet customers’ needs, many organizations need to make product decisions today that will result in future products and services. Better and faster data can bring the product innovations to market faster.
Does your Chief Data Officer align investments in data to the Chief Marketing Officer’s strategic customer and product decisions? Are strategic customer decisions with the best quality analytics?
Operational decisions impact the shorter and medium term Processes and enabling Technologies. The benefits from these decisions are seen in the current quarter.
Customer decisions occur in sales and support processes every day. A decision to honour a warranty or set up a service appointment for your most loyal customers needs good information. For example, do the sales and support teams have the right customer data and fast enough to satisfy your customers’ needs? Does all the necessary customer knowledge available on demand in your call centre?
Does your Chief Data Officer prioritize the highest value processes and support them with the best quality data available when they’re needed? Does your CDO align to the COO’s priorities and the CFO’s efficiency agenda? Does your CDO work with the CIO to break down data warehouse silos and ensure systems and technologies enable an integrated view of customers?
Organizational decisions affect the People (skills & organizational structure) and Culture. These decisions have been typically less data-driven but leading organizations are increasingly measuring the match between their people’s skills and the job requirements. This data is driving changes to training and benefits programs, for example.
Does your Chief Data Officer help the Chief Human Resources Officer make people and cultural decisions with the right data?
Next Steps to Establishing the Enterprise Decision Inventory
Clearly, today’s organization has a complex set of short, medium and longer term decisions. These decisions span the Marketing, Sales, and Support functions but aren’t necessarily integrated. Giving the CDO the mandate to capture these decisions with a cross-functional Enterprise Decision Inventory will help the C-Suite connect the dots and make sure investments in data management efforts pay off. Beyond data governance and data management activities, the EDI can be the foundation on which the CDO builds a solid roadmap and clear action plan.
Something to think about: Does your Chief Data Officer have a robust Enterprise Decision Inventory framework and decision-driven data management roadmap to support your strategic, operational and organizational decisions?