Building an analytics-driven organization

Data is the new oil. Developing the capabilities for exploiting data & analytics to solve business problems is a big investment & takes considerable time and effort. Without a clear strategy on using analytics to compete and deployment of the right technological architecture and capabilities, organizations might end up in a bowl of soup.

Exploiting data and analytics requires 4 main capabilities:

1)     Data: Identify, combine and manage multiple sources of data

2)     Infrastructure: Get the required IT infrastructure in place

3)     Skills: Build advanced analytics models for predicting and optimizing outcomes

4)     Culture: Transform organization to make it more data driven, organizations use data & models to make better business decisions – Most critical and difficult



We need a clear strategy on how to use analytics to compete and the deployment of the right technological architecture and capabilities.

1.      Choose the right data: Data

•  Source data creatively: often you have the data but don’t know how to use it effectively
• Also need to get creative about the use of external data / new sources of data

2.      Get the necessary IT support: Infrastructure

• Identify and prioritize business requirements and get the necessary architecture in place
• Most important data need to be integrated first for use in analytics
• Address and merge other data in a as-and-when-required basis

3.      Build models that predict and optimize business outcomes: Skills

• Identify a business opportunity and determine how the model can be used to improve performance, instead of looking at data and trying to analyse what needs to be done
• The model should not be too complex for practical application
• The model should be able to easily scale up with least effort

4.      Transform your company’s capabilities: Culture

• Managers generally don’t understand big data models and hence don’t use them
• Tools seem to be designed for those experts in modelling rather than for people on the front lines
• Develop business relevant analytics that can be put to use
• Embed analytics in simple intuitive tools and interfaces for the front lines to sharpen marketing, risk management and operations decisions.
• Organizations need to upgrade their analytical skills and literacy. Managers must view analytics as central for problem solving and identifying opportunities. Incentives and metrics to reinforce behavior.

Leaders should invest sufficient time and energy in aligning managers across the organization in support of the mission.

Article used for reference : https://www.mckinsey.com/business-functions/digital-mckinsey/our-insights/three-keys-to-building-a-data-driven-strategy