Decisive Facts helps clients to obtain fresh insights with data & analytics so they achieve a lasting strategic advantage. It is an ideal area to work in with lots of opportunities for our customers. In our daily practice, we regularly notice some confusion in this relatively young business. This is why we, at Decisive Facts, created this blog on the subject.
One item that strikes us is the list of terms that you read in media and blogs: Big Data, Analytics, Predictive Modeling, Forecasting, Business Intelligence, Data Science, Dashboards. For many of these terms, shared definitions are lacking, and most of the terms are used as synonyms. We therefore call this in the remainder of this blog “data & analytics”.
A growing number of advisors have entered the marketplace of the data & analytics concept: intermediaries, recruiters, marketers, event organizers, and to a fewer extent, investors. These advisors often have insufficient knowledge to make the leap from a concept to a really successful project. To be fair to them, it is not very easy: data & analytics is, above all, a complex puzzle that requires business knowledge, in-depth knowledge of data, and a background in writing algorithms. This is why a lot of organizations don’t make their way to great practical solutions and get stuck in conceptual terms.
Data & Analytics in four simple groups
To be able to better classify the data & analytics initiatives, we have defined four different groups:
- Data & Analytics Hype. This is the domain of story tellers, TED-talks, seminars with the newest gadgets, a world in which facts and fiction meld together. There is mainly talk, interesting talk, but little is actually delivered.
- Data & Analytics Capabilities. This is an area of solutions that are technically feasible, but have insufficient added value, and do not have a reasonable business case. Nowadays every two days as much data is generated as between the beginning of mankind to 2003. Not all those data are equally useful.
- Useful Data & Analytics. These initiatives have a positive business case, which results in quite short payback time. These days, organizations can make considerable gains with useful initiatives. A remarkable increase in turnover combined with cost reductions of more than 20% are no exception.
- Strategic Data & Analytics. Improvements that are of crucial importance to a business, which would not be possible without data & analytics. The speed, immersion, and complexity of an analysis is only possible using a smart algorithm.
For advisory companies it can be quite lucrative to be working with the first two mentioned areas, possibly nowadays even more than the latter two areas. With Decisive Facts we work solely with Useful Data & Analytics and Strategic Data & Analytics. These areas are explored in more detail below.
What does usefull data & analytics mean?
Useful data & analytics means that an organization targets initiatives with a strong and positive business case. In our judgement, a payback period of six months or shorter is preferred. In our daily practice we have consistently achieved this objective and therefore is a realistic goal for businesses to strive for.
An algorithm can be seen as a smart way to automate processes that are now being carried out by people. Some examples? The selection from a database of those contacts that have highest probability of sales. Determine the optimal amount of people at a call center. Determine the smartest and least expensive way to handle client claims. Determine the number of seats being overbooked on a given flight.
Another example of useful data & analytics is the optimization of existing tools. A lot of important decisions are being made using spreadsheets and MS Access databases. With the redevelopment of a given process a lot of time and money can be saved. Besides, the quality of decision making increases. In the diagram below each step is depicted:
It is our experience a short assessment of at the most a few days are sufficient to come up with a concrete plan for improvements.
Strategic Data & Analytics
Strategic Data & Analytics has more impact on existing business processes. The potential gains are a lot higher as well. With data & analytics it is possible to tailor for specific needs of a client with more granularity. This leads to more customer satisfaction. While doing so, it is also possible to keep operational risks at a minimum through proper and sufficient controls. Last but not least, with data & analytics costs can be reduced significantly.
On an executive level, it requires trust between the creators of solutions and the leadership of the organization.
This bond of trust could be built by solving the client’s problem by means of a stepwise approach. The first step is about determining the feasibility of a change by developing a working prototype (is it possible?). The second step consists of testing the results on a small scale (is it working?). The third step is the organization wide roll-out. The focal points are internal and external communication, training of the employees, and a solid technical solution that fits the system architecture of the organization.
Want to meet?
Do you want to exchange some thoughts on the possibilities of data & analytics for your organization? Then please contact us, free of obligations. Regularly we organize free round table sessions in groups and on Friday mornings we organize individual Skype calls with persons interested. We can’t make it any easier for you!