SDS 132: The Data-Driven Executive

Welcome back to the SuperDataScience podcast, ladies and gentlemen. Previously on this show, we had Eugene Dubossarsky speaking about his experience working as a data science consultant with executives. And in fact, we’ve actually had a few data science consultants or directors of data science consulting firms on this show speaking about their experience of working with clients in the space of data science, or explaining data science and implementing data science solutions, and this episode is going to piggyback on top of that. We’re going to talk about what data science means for executives.

So this episode is for you, our dear executives. For those of you who are listening, for executives, for managers, for directors, for entrepreneurs, for business owners. And we’re going to explore a little bit where is the space of data science going in terms of that C-suite or C-level management. And so I want to start this episode with a phrase which you might have heard. The phrase is “marketing is king”. What does it mean, where did it come from? Well, back in the day, back in the previous century, in the 30s, 40s, 50s, 60s, 70s, 80s, all the way up to the 90s, everything was very local. We lived in a very localised world, and even though you could travel and fly around, there was no internet per se. And for example if I’m living somewhere in Denver, Colorado, and I want to go buy a hammer, there is maybe a couple of shops where I can buy a hammer, or some tools for my workshop. You can just name any product, and there’s always just a couple of stores that are quite known that you go to and you buy whatever you’re looking for.

And so back then, businesses didn’t really have to worry that much about marketing. You just had to have a decent product, a more or less good customer experience, how they walked through your shop, you didn’t really have to worry about that too much either. And basically, you just needed to make sure that people know that you’re there. And that meant putting an ad on the radio, or putting up a billboard, or something like that. So it’s in people’s minds that if they want to buy tools, then you are over there on First Street, or Second Street, wherever. And that’s it. That’s how it was. You had to have an address in the phone book.

But now things changed. And starting from this century, we are in web 2.0, internet’s taken over the world, and now if I live in Denver and I need a hammer, I’m probably not going to go to a phone book and look up where I can buy some tools or listen to the radio for that type of ad, I’m actually just going to go online. And in fact, I’m probably not even going to buy the tools from Denver, I’m going to buy them from Amazon, or from somewhere else. Not just even nationally, in the US, if I need a specific type of hammer or something, I can buy it from anywhere in the world. And so all of a sudden, businesses were competing not just with their local peers, but actually with every other business online globally. It’s a radical shift.

And now, an ad on the radio and a billboard and some information in the yellow pages is not going to be enough. All of a sudden, you have to have the best marketing. You have to not only have a great product, a great customer experience, but you also have to have the best marketing in order for people to even know that you exist, people to even get on your website, and people to order from you. And that’s why back 10 years ago, it became common and normal for executives to have some sort of – we’re talking about CEO-level executives, so Chief Executive Officers, directors, business owners, entrepreneurs – to have some level of marketing experience or at least understanding of how they’re going to market their product. There was an inherent skill that was expected, that was necessary for the survival of the company and, as an extension, the survival of the executive, the CEO, in that world.

But now, things are changing. Now we are moving into a world where marketing is so ubiquitous, everybody knows marketing, it’s become such a standard thing to do, it’s a no-brainer. There are procedures that you follow, there’s specialists in marketing, there’s consulting firms in marketing, and so on, but what is the new advantage, the new cutting-edge advantage that executives can and should have is data. And that’s why data is king.

Marketing is still important, but data is that little – or not little – that huge addition that an executive can bring to their role that can really make a business succeed or fail. It’s something that can give a business that competitive advantage and help it take that unfair market share. So if before, marketing would help you take that unfair share of the pie, really good proficient marketing, it’s no longer the case. Everybody does marketing. Everybody does it more or less the same way. But now, it’s the data-driven side of things that can give you that unfair share of the market.

So I wanted to read out two stats that I found here. 144 executives of global organisations (CFOs and CIOs) were surveyed by KPMG Capital, and all of these were CFOs and CIOs of companies that make at least 1 billion or more in annual turnover. What happened there, this is quite old, but still relevant, this is January 2014. And what happened there was they found that 69% of the executives believed that it is crucially important, or very important, to have data and analytics in their businesses. So as you can imagine, as time has passed, probably that percentage has gone up even more. But at the same time, 75% of those same executives said that they find it difficult to make decisions around data and analytics. 75%. So perhaps that number has gone down a little bit, but I wouldn’t say that it’s gone down that much based on what I’ve seen in the world, and based on my understanding of the kind of perception of data science that executives have at the moment.

And in a sense, that’s a good thing. That means that those who do have the right perception, and who develop that right perception, for instance it could be you, who are listening to this podcast, will be ahead of the game. So executives are struggling with things like how to create the right environment to undertake a data-driven transformation in their business, more than half aren’t sure what data to collect in the first place, how to break down data silos in their enterprise, and so on. And so there’s quite a few things. And what this episode is, is it’s not a silver bullet how to solve the problem, it’s an episode more to help people be aware of the fact that this problem is out there, and the businesses that solve it first will have unfair competitive advantages and will drive their competitors out of the market, or at least grab a much bigger share.

And so my advice to executives would be to really think of what you can focus on, of how you can jump into the space of data science, or at least develop that data science acumen so that it’s easier to transform your organisation. And here are a couple of things to look into. Trends in machine learning, self-serve analytics, big data, artificial intelligence, blockchain, thinking about culture and how to develop not just a data science function in your business, but how to spread a data-driven culture across the organisation. And I think that’s much more important, because if you have a data science function, that’s just like you hired a couple of consultants that are now internal to your business who help you solve problems. But when you have a data-driven culture in your organisation, that means every single person in the organisation is thinking analytically, is contributing to working somehow with data, and to helping that data science function do their job much better. And they’re actually all believers in the power of data.

It’s just like having a customer-centric business, where everybody in the business is all about the customer experience. Same thing here. Everybody in the business should be about data. And personally, I think in the next 10 years, every single employee of every single company is going to be required to have some level of data acumen. Just like 10 years ago, we didn’t even know what iPads were, but now pretty much everybody in any business is expected to know how to use them, and any business can, and a lot of businesses do, introduce iPads for their employees to work with.

So a data-driven culture would include things like knowing how to nurture data advocates and cultivate that data-driven culture. And another thing to think about is data strategy. So not just to have some thoughts about “ok, so we’re going to implement this data science team and then they’ll do something.” No, it’s actually about having that data strategy, about how are you going to use data, how are you going to break down those silos in your organisation, and give more access to data? How are you going to implement new tools, new technologies, and things like that. So we have IT strategies, we have finance strategies, and things like that. Why not have a data strategy inside your business?

So that’s just a couple of things to look out for, but the main takeaway, the main point, is that in this day and age, the new motto should be “data is king”, and it’s very important for executives to develop that level of acumen in the space of data and data science that will help foster the right culture, the right transformations, in the business that they’re running in order to put it ahead of the game. Because it’s going to happen whether we like it or not. It’s really already happening, it’s going to happen faster and faster.

There we go. Hopefully that was insightful, especially if you are in that executive chair. And best of luck with these transformations and in this day and age. And I’m sure if you’re listening to this podcast, you’re already halfway there, you’ve already got the right mindset of getting you and your organisation to the right place. Thank you very much for your time today. I look forward to seeing you back here next time. And until then, happy analyzing.