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Perspectives

Six Steps to Creating a Data Culture

2015-09-17


Young companies have a distinct advantage over their longer standing competitors: Data is in their blood. For these digital natives, it's second-nature to put data and digital processes at the heart of their strategy and use data-based insights to make their decisions.

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Young companies have a distinct advantage over their longer standing competitors: Data is in their blood. For these digital natives, it's second-nature to put data and digital processes at the heart of their strategy and use data-based insights to make their decisions.


Traditional companies can close the gap, however, by hiring a chief data officer (CDO) to develop a data strategy, manage the data ecosystem and – most important – educate employees on the power and possibilities of data.

Here are six steps that CDOs can take to nurture a thriving data culture that, along with a well-tuned data strategy, turns digital code into a competitive edge: 

Map your organization's use of data.

Employees need to perceive data as a flexible asset whose use and value ripples throughout the organization. CDOs can encourage that by mapping the organization's data supply chain into a big-picture view of available data – who creates it, where it resides and who consumes it. Through this map, everyone can understand how their own data usage fits into the broader enterprise and who else might make use of it.

Data maps can also uncover "dark data," or pockets of information that go largely unstudied but can yield valuable insights, such as machine data and customer service call logs. For example, combining machine logs from a dispensing unit with geolocation data can help predict inventory patterns and improve the ordering processing.

Focus on the "art of the possible."

The hallmark of a data culture is the ability to understand the versatility of data and identify alternative uses for it. Employees regularly encounter data that is of little value to them but – when considered through the context of a data map – might be of value to someone else. CDOs should encourage a mindset of finding alternative or unusual uses for data by sharing it with other teams.

An example of this is the popular TV series House of Cards, which Netflix developed by gathering routine viewer data and correlating it in new ways. The streaming service discovered that subscribers who watched the original BBC series were also avid consumers of movies starring actor Kevin Spacey or directed by David Fincher. When Netflix licensed the BBC series for a remake, it signed Spacey to star and Fincher to direct.

Be transparent about data.

Data can become a valued asset only if its accuracy is trusted, its provenance is well established and its security is safeguarded. CDOs can build trust in data by tracking its quality and lineage and providing multiple use cases depending on the data quality. Consider a data set on customer spend that is missing attributes such as date of birth or address. While such data is unusable for personalized offers, where laser-like precision is required, it is still relevant for insights that can be drawn with broader strokes, such as understanding segment-based spending habits.

Creating A Data Culture

Develop reward-sharing mechanisms.

Celebrating data successes is essential to promoting a healthy data culture. Such recognition can occur in many forms, including videos, blogs, special-occasion gatherings or a section on the company portal. The data initiatives selected for recognition should be aligned with the organization's innovation objectives, whether it's reducing customer churn, increasing customer intelligence or penetrating new markets.

Identify areas of friction within the organization.

In a thriving data culture, information-sharing should be a way of life, not a source of tension. Consider the traditional roles of product engineering and sales. When sales funnels new information on customer needs and desires to engineering, it might cause conflict because engineering's main objective is to meet deadlines and budget requirements. However, for sales to meet its goal of boosting revenues, it needs products that meet customer needs.

The CDO can help the two departments find common ground. By using data to prioritize features, teams can objectively choose between time to market and cost. For example, what does customer feedback reveal about feature preferences and customer satisfaction levels? Data can help to improve collaboration by keeping the focus on facts, not emotions.

Elevate the conversation to emphasize strategy and innovation.

Everyone in the organization should be made aware of the real purpose behind a data culture: to sharpen the corporate strategy and drive innovation. When employees see how data connects to corporate objectives, they will overcome their reluctance, apathy and fear about data-sharing. CDOs can promote the link between data and strategy by hosting ideation sessions and hackathons to accelerate strategy and innovation efforts. Doing so can also help employees feel more engaged and part of a bigger mission.

Transitioning to a data culture requires dramatic change for traditional organizations, but by taking these six steps, CDOs can help their organization move toward managing data as a strategic asset.

For more about data culture, read our whitepaper How to Create a Data Culture [PDF], or visit our Enterprise Information Management practice.

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Six Steps to Creating a Data Culture