With the “democratization of data,…now you can be your own Jedi master of it,” says Clifford Hodges, regional manager, General Motors International Operations leadtime reduction. Recent Harvard Business Review Analytic Services research shows that analytics is not only changing organizations, but also individual’s professional careers. Here is a brief excerpt from the full report that digs deeper into the finding.
ANALYTICS IS CHANGING INDIVIDUALS AND ORGANIZATIONS
Another important finding is the way in which the role of decision makers is changing. The deluge of data from social media, emails, videos, presentations, and other nontraditional sources of information gives executives an unprecedented ability to understand their customers and businesses, anticipate challenges, and identify opportunities.
To fully exploit the opportunities and resolve the challenges, executives, managers, and professionals are cultivating new skills to understand what data is important and to dive deeper into the numbers to make and test their assumptions and decisions. At the same time they are forging new—and deeper—relationships with analytics professionals, elevating them to the position of trusted internal consultant.
Eight out of ten say they are reliant on data in their roles. Almost three-quarters say their areas rely on data to make decisions. And roughly the same majority also predict that their organizations’ overall reliance on internal data will increase in two years.
So it’s no surprise that over half of respondents (52 percent) say they have had to improve their analytics skills, while just under half (44 percent) have taken action to improve staff analytical skill levels. Almost three-quarters of the individuals who have identified their companies as analytics leaders say they had to enhance their analytical skills—a key finding about the pathway to becoming an analytics leader (Figure 5 below).
Macys.com provides a telling example of how executives are reshaping their roles through analytics. The retailer uses visualization in its online channel for business and customer insights as well as a way to set the stage for predictive analytics modeling. A significant element is that the impetus for these initiatives comes not from the information technology (IT) department but from the executives themselves who want a deeper understanding of the data. “We are seeing more interest from the C-suite and upper-level management in interacting with the data, so we are deploying interactive dashboards through portals,” says Kerem Tomak, vice president of analytics for Macys.com.
For example, the online retailer implemented an international shipment dashboard that can reveal which countries are generating the highest sales. The executive can look at the heat map of the world and drill down to the key issues, such as delivery delays, in each country. “This allows the executives to really understand the driving forces behind key business units and components,” he says. “They can visualize the source of the data and get an easier grasp of the connections that are creating different trends. They can make faster decisions that way.”
Overall, only 25 percent of companies in the survey report using interactive data visualization to date. However, analytics leaders such as Filippo Passerini, Procter & Gamble group president of global business services and chief information officer, stress the need for such tools, which are fairly new, to enable decision makers at all ranks throughout the organization to quickly profit from the use of analytics.
“We’ve been using analytics for many, many years, but the difference now is we’re blending analytics and visualization tools, which makes the analytics much more compelling and much easier to use,” the CIO says. P&G employees have access to a visualization-laden desktop cockpit to monitor key metrics in real time as well as to receive alerts. “We have the ability to bring to life for the line managers what is going on in the business in real time, so they can focus on specific issues. Essentially, we are able to manage the business by exception.”
While P&G’s reshaping of the roles of the entire staff may be unusual, it is clear that the professional lives of decision makers from the corner office to the call center have evolved due to analytics. “It is the democratization of data,” says Clifford Hodges, regional manager, General Motors International Operations leadtime reduction. “Before, the data was in the hands of only a few highly trained people. Now, many executives can use pivot tables and formulae and drop and drag information to come to their own informed decisions quickly. You can be your own Jedi master of the data.”
Figure 5: click to enlarge
NEW ROLE OF MANAGERIAL JUDGMENT
As the evolution toward data-driven decisions occurs, the current stage of decision-making evolution is to judiciously add management judgment to form real-world insights about the data. As Michael Pierce, customer service manager at Bosch Security Systems, says, “Personally, I run with analysis first, and during the research I will listen to my intuition. When my gut does not agree with my decision—and all analytics show it is the correct one—I pay closer attention to the results.” As this suggests, business users are seeing that making the right decision in a timely manner is a matter of balancing data analysis with judgment.
Another key development uncovered by the survey is how the use of analytics is improving the standing of executives, managers, and professionals in their organizations. More than four in ten of those in the survey say that analytics has increased the importance of their functional area within their organizations (Figure 5).
Read about the five stages of the analytics evolution and other changes to the decision making process in the full Harvard Business Review Analytic Services report.