In our recent e-book, 3 Hacks for Onboarding AI Platforms, we outline a few key steps to building the right team and culture to support an AI deployment. And we did so for good reason. There is broad consensus that the success of digital transformation efforts hinge on having a data-driven culture behind it. A 2019 Deloitte study found that companies with strong data-driven cultures were twice as likely to exceed business goals. Another study by New Vantage Partners found that 95% of the challenge to adoption of big data and AI initiatives was cultural, organizational, or process-driven rather than technological.
Given this, organizations have prioritized fostering data-driven cultures within their organizations. Whether it’s hiring a digital-focused executive, establishing centers of excellence, or instituting organization-wide mandates, the focus is on moving away from decisions based on gut feeling to those based on data-derived facts.
Organizations Must Look Beyond the Numbers
Sounds great, but an effective data driven organization must often look beyond the numbers and can face major consequences when they fail to do so. Take for example Zillow, a company that has used data to not only build more accurate real estate models but has also leveraged data into a powerful competitive advantage.
Zillow’s automated home-buying business recently made headlines for its decision to halt home purchases. The company, which has access to more than 17 years worth of data, is hearing backlash after the announcement. Some are calling into question the company’s ability to properly plan and take into account logistical constraints. Others are wondering if their brand has been irreparably damaged. How could these things happen in a data-centric company?
Attributes of a Data-Informed Culture: Intuition & Ownership
In our experience, organizations have proven tremendously successful when they connect big data analytics to the business strategy. This data-informed approach means they acknowledge the data-derived insights but are also aware of and account for the implications of other non-data factors that may impact the direction of the overall strategy.
It also means that when building this data-informed culture, in addition to data literacy, organizations must also look for and encourage two key attributes: 1) Intuition and 2) Ownership.
Intuition is defined as the natural ability to know something without any proof or evidence.But it’s also another data point, based on unconscious knowledge, expertise, and experience to be combined with other data in decision making. Ownership is the state of being responsible and accountable. It’s critical that these two components are embedded into the company’s values so that data may be used in a way that properly guides and informs decisions. Otherwise, you may be sitting on actionable insights that no one has evaluated properly or acted on because it’s “not my place.” Someone must answer to the choices being made and how those decisions align to and support broader goals.
It’s easy to wonder if the culture at Zillow didn’t empower the decision makers to use their intuition in the process, but instead they had been accustomed to letting the data be their one and only guide.
It also highlights a gap between the company’s actions and the real-world issues having to do with the on-the-ground workers and supply constraints. This could be the result of a lack of ownership over the decisions being made.
Being data-informed in addition to data-driven means using both intuition and ownership to constantly check your assumptions, methods and outcomes. The qualitative complements the quantitative, just as the human element complements the data analysis.
If you want to take your data insights to the next level and avoid the unintended consequences associated with mismanaging the intangible side of your business, look for people that demonstrate high intuition and ownership traits. Your culture will thank you for it.