Unleash the power of data with a modern data strategy
In my last blog, I stressed the need for a modern data architecture (MDA) to underpin the next generation of the cognitive enterprise, fully harness data using the latest technologies, and sustain a platform-centric business model that supports people, process and technology optimized around business goals.
This MDA journey starts with a holistic, business-driven modern data strategy that will crystallize and prioritize a strategic vision driven by focused business goals. Our work with clients bears out that deploying an MDA across the business in an incremental, prioritized fashion – with a focus and emphasis on starting small and iterating often – can unleashe the full power of data very quickly while delivering short- and long-term business benefits.
Why take the time to build a data strategy?
It’s a question we are often asked because Chief Data Officers are often eager to quickly dive into the planning, architecture, design and build phases and start to show results and ROI.
In her article, Tricia Morris writes, “In the race to win customers and market share, data-driven organizations are increasing the distance between them and their less-informed peers. McKinsey Global Institute reports that data-driven organizations are now 23 times more likely to acquire customers, 6 times as likely to retain customers, and 19 times as likely to be profitable as a result.”
In the same article, Netflix, Amazon and Domino’s are praised for being data-driven companies that are obtaining and retaining customers and market share in an accelerated fashion based on a holistic data strategy that drives significant advantages and is aligned to their business vision.
In a recent survey conducted by NewVantage Partners, 64 C-suite technology and business executives from very large corporations such as American Express, Ford Motor, General Electric and Johnson & Johnson were interviewed. The results are startling.
“Companies are investing in Big Data and AI, but they are not seeing commensurate results. Though 62.2 percent report measurable results from their big data and AI investments, less than half say they are competing on data and analytics (47 percent), have created a data-driven organization (31 percent) or have forged a data culture (28 percent).”
These are disappointing results and further emphasize the fact that normal methods and strategies might no longer apply. A modern data strategy coalesces the enterprise around a common goal, establishes sound principles, processes and techniques to manage data as an asset, ties those data assets to business outcomes, offers a defined path to dissolve data silos, and provides an actionable roadmap so that progress can be clearly measured.
What makes a modern data strategy different?
A modern data strategy is a defined enterprise-wide roadmap that identifies and leverages key principles, strategic data initiatives, concepts and best practices to achieve and surpass business objectives. I also believe it has several distinct characteristics that separate it from the more conventional approach we have seen many companies attempt in recent years:
- Provides an enterprise data-driven roadmap. At its initial conclusion, a modern data strategy provides the strategic vision, plan and roadmap that drives the enterprise towards a data-driven approach in all facets of the business. I intentionally use the phrase “initial conclusion” because a successful modern data strategy is a “living” strategy and roadmap that should be reviewed, revised and changes re-implemented every year.
- Emphasizes data value over data correction. The conventional approach emphasized what an organization is going to do to the data, such as data sourcing, data cleansing, data validation and data protection. These are all important and should be addressed—but as part of a more tactical data management strategy that is a follow-on to a holistic modern data strategy. Conversely, the modern data strategy emphasizes the strategic view of how to use the data to derive maximum business value.
- Enables a modern data architecture. The MDA is powered by events containing standardized, clean, contextual data flowing through robust and scalable data pipelines, characterized by real-time data enablement – capture, validate, enrich and post – and seamless data integration. To achieve this symmetry, the modern data strategy must define a common business information model to fully represent the enterprise data domains and act as the foundational cornerstone for the data-driven company. In addition, the modern data strategy will support the MDA as well as the design and implementation in complex, multicloud environments where data flows in an organized, optimized and governed fashion.
What are the hallmarks of success for a modern data strategy?
- Business-driven. The first hallmark is that it is business-driven with a CxO level of sponsorship. This does not mean that the CxO attends every workshop or meeting, but he or she should be active in the process and appoint a delegate that can drive the process and make decisions quickly. I recently led the modern data strategy for one of the largest global banks, and the CDO was the sponsor. We met early almost every morning for coffee, and he would get a quick status and then ask if there were any roadblocks. One such morning I told him we were trying to schedule a series of workshops but no one was accepting the invites. He immediately made a call and the roadblock vanished. For the rest of the project, active participation in all the workshops was phenomenal.
- Actionable roadmap. The primary deliverable from the project is an actionable roadmap that is incremental in nature and tied to business goals. Progress can be measured against business outcomes, such as increased revenue, cost savings, faster implementations and better data quality.
- Enterprise-wide focus on being data-driven. Data-driven companies understand their data lineage from creation to final consumption and have a clear view of all the steps in the process. They are constantly improving the data enablement process – including optimization techniques such as real-time classification, validation, enrichment and automation – to advance their business goals. Rewards and incentives across the business are driven by these same business goals so the whole organization is incentivized to look for opportunities for constant improvement.
The modern data strategy is a great starting point for any organization that strives to either become a data-driven enterprise or is stalled on that journey. A modern data strategy is a prerequisite for any data-driven enterprise and is closely linked to the MDA, acting as the foundation for an actionable roadmap alongside a multicloud strategy and its accompanying cloud data management artifacts.
Connect with me on LinkedIn and share your thoughts on your data-driven enterprise journey.