The vast majority of modern business leaders today are unsurprisingly looking to data and advanced analytics to create smarter, leaner organisations. We’ve reached a point where we almost universally understand that data is a potential source of power – and if you unlock that potential in the right way, with the right people, approach and tools, you get value.
We can’t not understand, I suppose – we’ve gone through 2 decades of never-ending buzzword-driven hype-cycles around everything from Data Science to AI. The data lexicon is even penetrating the public domain – the pandemic story has been told almost entirely through the medium of data (“we’ll follow the data”, “Chris Whitty’s magic charts”, “flattening the curve”, “the R number” etc.).
So in the midst of all this noise and focus, where we go from here? How do businesses move from “we get that data is important” to actually creating value?
Build on business objectives.
Here are 2 really tempting data conversations to start with:
“We have lots of data – what can it tell us?”
“Let’s do some AI!”
Beware! These routes are highly likely to fail the so what? test. Instead, we should start with business objectives as a focus for adding value.
Objectives are helpful because they usually entail a set of target KPIs which we can impact with data and analytics, allowing us to structure a business case and providing a benchmark against which we can measure a return on our data investment.
But even having a clear understanding of your business goals and their relationship with data still leaves you some distance from creating evidenceable value. So what next?
It is tempting at this point to start looking for initiatives, perhaps using idea-gathering techniques across a set of business areas. Using this approach is attractive as a means of enrolling colleagues in the data narrative - but it is all too easy to end up with a large number of unstructured ideas, making it difficult to know where to start.
I’ve heard customers describing this moment as like being in a sweet shop. You can see tens of ideas and they all sound exciting, but the metaphorical sugar high makes objective evaluation, prioritisation and focus close to impossible.
This is where domains come in. We can think of domains as themes where data and analytics have been proven to add value. Domains can be used to create a common language around data and give a clear sense of what data can do viewed through a specific lens. Domains can be used to engage leaders and create a focal point for the discussion of specific initiatives, so that the right business outcomes can be identified and delivered.
Here’s 5 key domains that in my experience do 2 things really well:
Cater for the majority of customer scenarios
Are highly ‘observable’ in terms of the impact you can create with data.
5 key domains that in my experience do 2 things really well
|Creating an informed organization.||An uplift in performance of the individuals and their ability to meet their objectives.|
|Empowering engaging customer conversations.||Increased revenue through more relevant customer interactions (e.g. retention, upsell, lifetime value).|
|Enabling intelligent decision making.||Increased margins across a number of business areas through more effective decisions.|
|Creating a more efficient organisation.||Reduced costs and time to value through intelligent automation.|
|Achieve a more sustainable business.||Measurable reduction in carbon footprint.|
Check back regularly as my team and I will be writing more about each of these initiatives over the coming weeks.
A case in point.
One of the best examples of the power of using domains I’ve seen was when working with a major insurance company. This company had previous invested in data through the lens of a series of innovative initiatives focused on solution areas. Previously they had invested in “an AI initiative", “a blockchain initiative", “a big data initiative" etc. None of these investments had delivered any value, and the leadership were running out of patience with their data programmes.
When we collaborated, we looked at the use of domains to create a more business-focused framework against which to guide investment. We determined that the ‘decision’ lens (iteratively enabling more informed decision making) was the best domain to start with.
We refocused the investment to focus on decision improvement. We iteratively identified key decision-making processes across a range of business areas (from resource forecasting to customer call handling), turning them into more informed, data-led decisions.
This was a great success – it created a consistent language across the business for data-led value generation, enabled people to more quickly buy into the change required to realise the potential of each project, and provided a structure for measurable incremental value creation understood by everyone.
Avoiding the traps is hard but designing successful data initiatives with domains can be a really effective way to create a bridge between business outcomes and data potential. Domains give your teams and colleagues an accessible framework for ideation, avoid technical jargon and will ultimately guide you towards the most ‘investable’ initiatives that deliver the most value to your business.
*Note: I first heard Harry Powell (Director of Data & Analytics at JLR) talk about domains on a call and it inspired a lot of my thinking here. So a lot of the credit belongs to him. Thanks Harry!