Employees must be trained to implement data, and data must be made more decipherable and usable for organisations to make the best use of business analytics, a report says.
A Corporate Executive Board survey has resulted in guidance for helping employees make better decisions based on business analytics data they are provided.
Half of senior managers and 38% of employees have the skills to properly derive insight from – and make good decisions based on – information gathered from suppliers and customers, according to the CEB’s report “Overcoming the Insight Deficit: Big Judgment in an Era of Big Data”.
The report also says that analytic skills are concentrated in too few employees, and executives don’t manage information as well as they manage talent, capital and brand.
The CEB built what it calls the “Insight IQ” index to measure employees’ ability to locate and analyse relevant information to make better decisions. The index reflects three elements – information attainability, information usefulness and employee capability. The CEB, an executive leadership consulting company based outside Washington, DC, used the model to survey almost 5,000 employees at 22 global companies to help overcome failure to implement data.
The report provides guidance for businesses based on how companies with high Insight IQ use their data. The report suggests that companies educate employees on the limitations of data, develop an analytic training curriculum, and hire quantitative experts who can coach and formalise decision processes.
Successful companies put information at the heart of their business plans and create incentives to encourage cross-company data standardisation efforts, according to the report. Foundational analytic investments, such as a dedicated analytics team, training design and information quality norms, are more effective when centralised, the report says. So the CEB advocates centralising management. But the survey found that centralising data into a single warehouse does not affect Insight IQ.
Data must be useable
Data isn’t helpful unless it is made usable. The report says that half of employees find information from corporate sources is in an unusable format. The companies with the highest Insight IQ improved information filtering, facilitated better visualisation and increased investments in training, the report says.
Improving information presentation with graphical depictions, combining data from multiple sources and filtering information to improve relevancy and legibility helps make data more useful, the report says. It’s also important for leaders to be transparent about the source of data and how it has been manipulated over time for employees to assess its usefulness.
The survey showed that just one-third of employees trust information from other functions of an organisation; the report suggests that tactics such as colour-coding data to indicate information quality or labelling missing fields can increase trust and lead to action that closes data gaps.
Struggles with IT
Seventy percent of business leaders in the survey reported that the information management capabilities of information technology functions were inadequate. The report says this is because IT professionals were trained to work with human resources, supply chain and finance, which had consistent and predictable business needs. IT departments struggle to meet the varied, unpredictable and individualised needs that business analytics require, according to the report.
—Ken Tysiac (email@example.com) is a CGMA Magazine senior editor.