Data Driven Success

Author: Graeme Hills
11/08/2023

This is the second article in a series which will discuss the importance of being data driven and provides a no-nonsense guide on how to best transition your organisation.  This article details how to take stock of your existing digital health. Later articles will discuss how to improve your data quality, how to automate your processes and finally how to implement your dream data solution.

In the first article, I discussed why being data driven is essential for your organisation’s success.  If you missed it, you can find it here.

PART 2: TAKING STOCK OF YOUR DIGITAL HEALTH

Your organisation’s digital health is important for you to have data driven success. Before you embark on your journey to being truly data driven, you need to stop and take stock of your existing digital health.  You need to conduct a thorough audit to understand what you have, what quality it is and what you need.  There are many different areas that could be included in such an audit. In this article, I will consider three areas which I believe are critical to improving efficiency, reducing waste and ultimately, improving profitability; data, processes and reporting.

Data

Organisations are generally very good at capturing data, but rarely good at managing it effectively.  As part of your audit, you should consider:

·         What data do you currently capture?

·         Are you compliant with your country’s data legislation, such as GDPR?

·         Where is it held?

·         What quality is it?

·         What data would you like to have and where could you get it?

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Make sure that you search for hidden sources of data.  People are very adaptable and inventive.  They will find workarounds to cope with system or process limitations.  Don’t be surprised if you discover that, despite investing in a fancy new system, your organisation is still heavily reliant upon Excel.  In fact, it is likely that many mission-critical processes simply wouldn’t work without the spreadsheets that Jane from accounting has put together.  Implement an Excel amnesty and make sure you identify all these little gems that keep your organisation running.

At this stage, your data is probably going to be of relatively poor quality.  Many of the customers that I have worked with have had problems with dirty data which is incomplete and more importantly inconsistent.  If you do find yourself in this situation, consider what is your source of truth?  In other words, if there is a conflict between the data in different sources, which do you trust more, that from source A, or from source B?

An important consideration is whether you need to flow data between systems.  Many organisations end up capturing the same information multiple times and duplicating it across systems.  If mistakes are made during this process, it will almost certainly cause you problems in the long run.  Slight variations or errors in the data entered will make consolidating the data that much harder and may lead to inaccuracies or false conclusions.

If you do need to flow data or have a multitude of systems, then it would be worth investigating whether these systems can be synchronised using Process Automation or integrated Platform as a Service (iPaaS) software.

Process

For many organisations, one of their biggest costs is employee wages.  While it varies enormously from industry to industry, wages typically fall in the 20 to 30% range, but can be much higher.  Therefore, using people to perform mindless and repetitive tasks is a waste of precious resources, which could be much better utilised elsewhere in the business.  It is inefficient and expensive. For the staff themselves, these manual processes are tedious, boring, and saps at their motivation.  No one ever goes into work on a Monday morning thinking “I can’t wait to manually enter 999 customer details today”. 

So, what is the answer? Well, the solution to this is automation.  By automating these processes, you can free up your people to work on higher value activities.  In time they will transition to become knowledge workers.  Then rather than being a cost, they will start adding value to your organisation.  They will have much better job satisfaction, leading to happier employees and higher staff retention rates.

Identify which processes can be automated. Examples could include, data entry, the preparation of operational reports, or chasing customers and suppliers, to name but a few.  Ask your employees what the most time-consuming processes are.  This is a great way to identify pain points.

It is worth considering whether the process can be simplified or optimised?  Why is the process what it is?  Was it consciously designed, or has it grown organically? 

Problems with data are often really problems with the process.  So again, consider whether you are collecting too much or too little data?

Are the SLA’s or KPI’s still relevant or do they need to change?

Is it mapped and documented? If not, then get it mapped and documented.

Remember, without a thorough understanding of your process you won’t be able to extract the data insights you need.

Reporting

Finally, it is time to think about reporting.  

What reports are you currently producing? Of those reports, what is actually useful and what is actually being used? There is no point in spending time and money creating reports for the sake of it.  Look to consolidate and cull these as a matter of urgency.  What data can you get from your existing systems and just as importantly, what information would you want to see that isn’t currently there?  Where can you get this from?

Of the reports that are left, how long do they take to produce?  Calculate the total effort both in terms of Full Time Equivalent (FTE) and in pounds.  You may be surprised how much of a cottage industry has arisen in producing Management Information.  Modernising and automating its production will not only save you money but will proactively drive accurate and timely information to you when you need it most.

Prioritisation

It is likely that you will have identified many areas for improvement by this stage.  Knowing where to start can be daunting.  To overcome this, you can use a scoring matrix to rank or prioritise these activities.  Select up to five or six key criteria and score each item against them.

On the image below you can see some examples of scoring criteria and a spreadsheet where the scores have been used to rank, in this case, different processes. Ideally you want the criteria to be quantifiable.  So, ensure that you restrict the number of values a criterion can have and give each a score.

Criterion can also be weighted if you feel that some are more important than others.  Finally, multiply the score by the weighting for each item and sum the results.  This will allow you to rank the items and determine an order in which to tackle them.  It is a good quantitative way to remove bias.

On a side note, you may determine that some of the lowest ranked items don’t actually need to be automated at all, as the Return on Investment wouldn’t be worthwhile.  In this case, these can continue to be performed manually.

Once you audit is complete, you can start thinking about improving your data quality and the benefits you can get from accurate, trusted data

If you have any questions or wish to discuss this topic in more detail, then you are more than welcome to contact me with any of the following contact details at the end of this article.

Graeme Hills PhD.