Think about the large successful organizations which are known for harnessing information for competitive advantage; P&G, Goldman Sachs, Capital One, Harrah’s, Progressive Insurance and you will find one thing in common. Their C level executives drive data-driven decision making top down. And the more organizations I see, the more I get convinced that it is one of the most important factors for a company which wants to ‘compete on analytics’.
Here is my hypothesis of why it is so:
Think about the large successful organizations which are known for harnessing information for competitive advantage; P&G, Goldman Sachs, Capital One, Harrah’s, Progressive Insurance and you will find one thing in common. Their C level executives drive data-driven decision making top down. And the more organizations I see, the more I get convinced that it is one of the most important factors for a company which wants to ‘compete on analytics’.
Here is my hypothesis of why it is so:
There is a fundamental Catch 22 situation in most large companies. Organizations do not have consistently good quality data (mainly due to process issues during intake) and unless the data is used to making real business decisions, it is hard to improve its quality.
In contrast, the middle management never wants to be in a situation to justify their decisions knowingly made using imperfect data. It is easier to justify subjective gut feel than objective decisions made with data with known quality issues.
In summary – the culture of analytics is a top-down phenomenon
What do you think? Do you agree with this observation?
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