‘Data is the new oil’ is a much-used phrase but having ‘oil’ is nowhere near as valuable as knowing what to do with it. Chris Underwood explores the role of data strategy in leadership and how data can help leaders to instigate organisational change.
Understanding the value of data and how best to exploit it has become a de facto skill for leaders. Many organisations ‘want to do something with data’ but have failed, mostly this is down to the fact they do not understand the nature of data. The iterative ‘test and learn’ processes of exploiting data are very different to how other functions operate. Collecting and collating data is only the start of the process.
Data is not a discrete entity, but an ongoing enabler and it is important to recognise that it is both an experimental and continuous learning function. To unlock its real value, organisations must set goals or clear business outcomes. Using the data to answer questions such as ‘how do we increase revenue?’, ‘where can we cut costs?’ and ‘how should we present our front page?’ can validate plans and help to solve problems. But rather than simply considering data as a resource to support decision making, it should drive strategy. Analysis of data patterns can predict trends and customer behaviour and identify ways to optimise the customer journey, helping businesses to plan for the future.
While clear strategies will guide effective data use, leadership is key to harnessing data’s true potential. In periods of disruption – whether navigating innovation and transformation or a crisis – data can also inform important decisions and provide clear directions to help organisations move forwards. 2020 has provided businesses with the ultimate Black Swan event, forcing leaders to make dramatic changes quickly. Information collected during this time is invaluable. Using data and feedback to demonstrate the overall impact of operational changes, such as remote working, leaders can identify ways to improve and make their organisation more resilient against future crises.