There are many surveys and white papers on how to manage and exploit data to drive our business forward in the 21st century.
In my opinion, most are either “motherhood and apple pie” or technical dissertations about various mechanics to extract, transform, centralize and harmonize data, ready for the magical subject matter experts to create visualizations and correlations from it.
The survey report below, “Insights from CFOs on Data Use”, is a little different. It is worth a read. I didn’t write it, so I don’t have a ”horse in the race” or any conflict of interest.
The report reinforces that the received wisdom on “DATA” is missing the point.
Specifically, managing and exploiting data is primarily a business problem. Not a technical problem.
Success hinges on context, and that context is business process, which requires operational subject matter expertise.
There are some related insights in the report that resonated with me.
- An excellent articulation of the need to identify the Key Business Questions (KBQs) for each business process or scenario. These are forward-looking questions that establish a framework to identify what analytics and metrics (such as KPIs and “Defectivity”) you need and what you will do with the insights produced by analytics. These questions are central to the overall strategy you are deploying or considering deploying in the future.
- A reminder that data should “bring clarity” to business operations and expose opportunities for process improvement and innovation. A myopic focus on performance “reporting” will fail in today’s world.
- There remains a reliance on lagging indicators, that confirm long-term trends, and are easy to identify, measure, and often used to compare against others in your industry. This makes lagging indicators appealing, even when the detailed measures differ between organizations and we blindly compare “apples and oranges”.
- Leading Indicators are the critical “missing link” to drive progress and identification of process defects and root cause insight. This data helps tee up a forward-looking vision, leading to a clearer understanding of how to manage resources to achieve better outcomes. To achieve this goal, data analytics need to answer questions about end-to-end business processes, that span across departments, business units and the entire company.
- The survey report illustrates that the biggest failing to date with data is in providing insight into “what we need to do to make things (progress) happen?“
I don’t like the use of the terms Descriptive, Prescriptive and Predictive data analytics in the report as I think they trivialize the issue, as real value comes from a combination of these perspectives.
The current level of business exploitation of data is causing a lack of visibility and limitations on “data driven decision making”, as the survey shows.
This CFO Survey found the most significant rise (increased 16%) in the lack of availability of human talent (skills) is the biggest challenge in success with data. These skills are multi-dimensional but the core is business process and operations knowledge with an understanding of what the data means (semantics).
This is not primarily a technology issue.
But that doesn’t make it any easier.
It does, however, focus our attention on where we need to take action.
The report is well worth a read. You can access it here . . .