Data alone may not be enough to guarantee better decisions, but better decisions almost always start with data.
Just capturing and storing data will not get us far. Disconnected and fragmented data can’t paint a complete picture because different segments linger in a detached state or in isolated buckets. Left disintegrated, they lack the necessary transformations to be turned into cohesive and compatible building blocks.
With all this data, why is it that we continue to make bad business decisions? I was asked this question the most in the business intelligence course I taught for a doctorate program. Truth is, more data doesn’t guarantee better decisions. Here are five reasons why.
1. Data Is the Raw Material for Better-Informed Decisions—Not Necessarily Better Decisions
The concept of “better-informed” decisions is distinctly different than the concept of “better” decisions. Better-informed leaders don’t always make better decisions, but better decisions almost always start with better-informed leaders.
It doesn’t matter how we get there, more data alone will not suffice. Different variables will inevitably shape not only the final decision we make, but also the path we choose to arrive there. History is filled with examples of leaders making “bad” decisions even in light of ample amounts of data to support the decision-making process.
2. Technology Alone Can’t Deliver Better Decisions
Coupled with the right technology, design, and implementation, analytics platforms can deliver on all three pillars of business intelligence: insight into the right data, for the right role, and at the right time.
But technology alone won’t guarantee a successful outcome. Our teams’ talent plays a more pivotal role. Their passion, regardless of the challenges they face or the resources available to them, will be the determining factor.
3. Lack of Leadership Will Result in Lack of Direction and Consistency
It starts and ends with leadership that’s keen to promote the culture of data-driven decision making. Our success depends on it more than any other piece.
Leading by example, data-driven leaders will be keen not only to consume the data but also to apply the insight derived from these data assets to decisions that matter. It demonstrates firsthand a mindset that sets an example for the rest of their teams. By recognizing data as a strategic asset, they provide a clear and consistent message for everyone to follow.
4. Enterprise Data Demands Integrated Data Strategy
The step to deliver reports on more data—Big Data or small data—alone isn’t synonymous with better or better-informed decisions. In order to deliver the true business value of business data, organizations need to formulate a carefully thought-out enterprise data strategy. The data intelligence framework can’t exist separately from or independent of the organization’s business or technology strategy.
5. More Data Is Useless if We Aren’t Asking the Right Questions
Having all the data and more of it doesn’t do much good if we aren’t asking the right business questions or simply don’t understand our assumptions. And most important is critical thinking—a skill we must demand in business. (It’s also something we need to teach more of at every level of higher education.)
We must carefully examine the evidence based on solid data that’s relevant to the question at stake before reaching any conclusion or making any decisions. Only then can we realize the promise of more data—to deliver actionable insight for faster and better-informed decisions.
Today more than ever, businesses of all sizes enjoy the ability to capture vast amounts of both structured and unstructured data at extraordinary rates. At the same time, new technologies such as cloud, mobile and in-memory are fueling this growth as they make it easier and more cost effective to acquire and analyze different data points. In some cases, these large data sets are quickly approaching Big Data territory—if we haven’t crossed into it already.
If insight from enterprise data engines is going to enable organizations to drive growth and profitability, data must become a conduit to enable faster and better-informed decision making.