One of the big questions companies must be asking is how to shift from traditional management to being “data driven.” If only there were a simple, quick quiz you could take to find out if you’re on the right path to being a data-driven organization.
Well. It turns out there is.
Dr. Thomas C. Redman, aka the "Data Doc" and president of the Navesink Consulting Group, says he’s identified the 12 traits of successful, data-driven companies.
In a recent Harvard Business Review blog post, he suggests executives--including you, CIOs--take a hard look at the list and score themselves by giving a point for every trait followed regularly and a half point for every trait you follow most of the time.
“Be hard on yourself,” Redman warns. “If you can only cite an instance or two, don't give yourself any credit.”
Here are his 12 traits, rephrased as questions to give it that magazine-quiz vibe:
1. Are decisions made at the lowest possible level of the organization? One CEO told Redman he actually made only four decisions a year. (If you’re unsure, Redman explains this further in the blog post.)
3. Is your organization using data to develop a deeper understanding of its world? Seriously, think about that word, “deeper.” Not just a cursory, same-as-everybody-else understanding, but a deeper understanding.
4. Is variation well understood and appreciated within the organization? Redman also explores this trait more fully in the blog post, and I highly suggest you read his exact words there. Let’s just say if someone’s taking credit for small weekly variations, then no points for you!
5. Do you deal with uncertainty “reasonably well?”
6. Can your managers combine their intuition with their understanding of data and the data’s implications?
7. Does your organization value and invest in high-quality data? Here’s a hint: That means you take data quality seriously. I should also note that while this is number seven on the trait list, quality data is number two on his three item to-do list.
“Frankly, you simply cannot be data-driven (or do anything consistently well for that matter) without high-level of trust in your data and data sources,” he writes. “You're reduced to your intuition alone, the antithesis of the goal here. Quality data is a necessity.”
8. Is your organization good at experimenting and researching? I take this to mean you’re not just passive data consumers--you are ready to dig in and work with it. But, he may also mean the very traits of experimenters and researchers are important.
9. Do your and other leaders’ circumstances vary and this can impact the decision criteria?
10. Do you understand that making a decision is only one step in a process?
11. Does your organization work hard not just at acquiring new data, but also at adding new data technologies and skills?
12. Do you learn from your mistakes as you go?
“… The data-driven are constantly re-evaluating, refining their decisions along the way,” he writes. “They are quicker than others to pull to plug as when the evidence suggests that a decision is wrong.”
So, how did you do?
If you’d like to read more about how successful data-driven companies differ from the rest, check out my blog post on the six ways profitable companies use data. That list draws on the research of Jim Giles, author of the Economist Intelligence Unit report, “Fostering a Data-Driven Culture.” It doesn’t contain as much overlap as you might think; however, a big common denominator is its focus on extending data throughout the organization.