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Doing Business in a Big Data World

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StrategyDriven Organizational Performance Measures ArticleThe Internet and cloud computing have revolutionized the nature of data capture and storage, tempting many companies to adopt a new ‘Big Data’ philosophy: collect all the data you can; all the time. But this new world of Big Data is proving to be much more demanding and complex than expected, requiring companies not only to adopt different technologies, but also to make significant changes to their business strategy, internal skillsets, and organizational structures.

Big Data is Not Just More Data: That’s because the nature of the data we can now collect has changed. Big Data involves not just the structured data (customer name and details, products purchased, how much was spent and when, etc.) that every company is used to capturing, but also unstructured data (data scraped from the Internet and social media channels that may come in a wide variety of formats, from video to voice). It may seem an obscure data management distinction, but this shift toward collecting unstructured data – which is a large part of what Big Data is all about – is sending shock waves across traditional organizations.

Why?

New technologies: The consistency and predictability of structured data is what gave rise to today’s centralized IT departments – running SQL/Relational Database Management Systems, and ERP and CRM software. Structured data is clean and predictable; easy to collect, organize and analyze – and is usually securely stored on a company’s internal servers.

Unstructured data is very different. It is messy, variable, and difficult to interpret; captured from a wide variety of sources and usually stored on distributed computing nodes through the Cloud. In order to capture, filter, and analyze huge amounts of unstructured data, an organization needs to leverage the new technologies that include massively parallel processing (MPP) and NoSQL/Hadoop-like (non-relational) database and software frameworks.

But getting access to these Big Data technologies means either buying it and building it into your organization’s current IT enterprise structure, or accessing the tools and data storage through Cloud-based offerings (or a combination of both). Whatever method your organization chooses, it will place a significant strain on your – probably already overwhelmed – central IT department, because they will need to construct a complimentary architecture with these two very different platforms.

New Skills: These new technologies also require very different skills, because in order to convert unstructured, randomly collected data into meaningful intelligence, organizations now need data engineers who understand the new NoSQL/Hadoop-like programming languages, and data scientists (often with PhDs in mathematics or statistics) who can set up the algorithms and correctly interpret the data. Employees with these skills are still expensive and hard to find: nearly 80 percent of companies complain that they’re already finding recruitment for these jobs either ‘challenging’ or ‘extremely difficult.’

New Organizational Structures: And because 80% of Big Data projects cross business lines or functions, surveys show that an alarming one third of Big Data projects are already being pursued without the support of the company’s central IT function, by adventurous departments tempted to access Big Data tools unilaterally over the Cloud – often then running that data through the (unsecured) smartphones of their employees. All of this means that CIOs and centralized IT department staff no longer ‘own’ company data the way they did in the past; giving rise to new concerns about data integrity and security in a more distributed and anarchic company structure.

As a result, Big Data is forcing CIOs to relinquish some of their centralized authority in favor of a power-sharing arrangement – not only with departments (such as Sales and Marketing) who want to run their own customer-focused Big Data projects independently, but with important new C-level rivals: the Chief Marketing Technology Officer, or the Chief Data Officer.

A New Company Data Strategy: This means that a Big Data company strategy requires a good deal of equanimity on the part of these various competing and overlapping roles to create policies that allow for departmental independence, but don’t expose the company to data breaches and misuse of customer data. And that’s why adopting a Big Data strategy also requires senior management to be much more involved in IT and data-related matters – providing clear guidance on what data can be used, in what way, and by whom.

In short, there is a lot more to doing business in the Big Data world than simply collecting and analyzing more data. It is a disruptive paradigm shift that most companies have yet to make.

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About the Author

Dale NeefDale Neef is a technology advisor, and author of Digital Exhaust: What Everyone Should Know About Big Data, Digitization and Digitally Driven Innovation (FT Press). A veteran of knowledge management, business intelligence, and large-scale technology implementation projects with more than fifty companies worldwide, he has been a technical consultant for the Asian Development Bank, has worked for IBM and Computer Sciences Corporation, and was a fellow at Ernst & Young’s Center for Business Innovation. A frequent contributor to journals, and a regular speaker at technology conferences, he earned his doctorate from Cambridge University, was a research fellow at Harvard, and has written or edited eight books on the economics of knowledge and data management and the use of information technology to mitigate risk. Learn more at www.daleneef.com.

Management Observation Program – Observations Change Behaviors

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StrategyDriven Management Observation Program Principles ArticleAdmit it; you perform differently when your supervisor is watching you. Suddenly, all of the performance rules become clear and important. You feel a sudden urgency and compulsion to recall them.[wcm_restrict plans=”25541, 25542, 25653″]

Employees naturally assume their supervisor is evaluating their performance when he/she is watching them. Thus, the simple act of observing employees changes their behaviors. From this occurrence was borne the principle of management by walking around.

But while a manager’s presence can instill good performance, it is equally likely to reinforce bad behaviors. It is a manager’s responsibly to correct employee behavior not conforming to written standards and expected norms. When managers fail to make such corrections, employees naturally assume the manager is endorsing their behavior as being an appropriate substitute. Worse, they may believe the manager disagrees with the established standard or expectation and is willing to allow the employees to knowingly deviate from the performance guideline.

Ensuring the Right Impression

Regardless of whether the management observation is formally documented or not, the manager is responsible for correcting employee behaviors deviating from established standards and expectations. Such feedback should be given in private and at the time of performance whenever possible. Issues involving personnel and property safety must immediately addressed even if not private. All feedback should be constructive, professional and not personal or personally focused. (See the StrategyDriven Management Observation Program Best Practice – Immediate Feedback.)

Final thought…

Management by walking around alone can be a very powerful behavior shaping tool but consideration should be given to the documentation of these observations. At times, this practice may seem administratively burdensome. However, documenting observations enables trending of performance and associated behavioral drivers over time; allowing determination of whether these behaviors are unique to an individual employee or common across the organization. Furthermore, this data can be analyzed to determine whether a given performance trait is exhibited cross-functionally among many work centers or is localized to a particular manager or supervisor. Such information is incredibly important to performing self assessments seeking to improve overall organizational results.[/wcm_restrict][wcm_nonmember plans=”25541, 25542, 25653″]

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About the Author

Nathan Ives, StrategyDriven Principal is a StrategyDriven Principal and Host of the StrategyDriven Podcast. For over twenty years, he has served as trusted advisor to executives and managers at dozens of Fortune 500 and smaller companies in the areas of management effectiveness, organizational development, and process improvement. To read Nathan’s complete biography, click here.

Business Performance Assessment Program – Use of Experience

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StrategyDriven Business Performance Assessment Program Principles ArticleRigorous business performance assessments rely not only on observable, quantifiable facts but also on the experience of those conducting and participating in the assessments. When properly applied, experience accelerates issue identification and deepens contributed insights. Experience, however, should not be represented as fact nor should it be used as the primary mechanism to combine otherwise unrelated facts when making the case for a performance strength or improvement opportunity.[wcm_restrict plans=”25541, 25542, 25653″]

The Role of Experience in the Self Assessment Process

Applying experience is an important part of an effective self assessment. Ways in which experience should be applied include:

  • Identifying Observation Opportunities – Assessors identify and prioritize observation opportunities based on their past operational experience. Such application, combine with a preliminary fact review (performance metrics, procedures, past assessment reports, condition reports, etcetera), helps ensure those activities most likely to contribute meaningful data to the self assessment are observed. Furthermore, operational experience aids in the identification of activities that are at higher risk of performance errors.
  • Identifying Observation Relationships – Assessors should leverage their experience in preliminarily identifying relationships between facts to identify functional issues and between functional issues to identify overall organizational defects. Once an experience-based associated in made, a logical, fact-based analysis should be performed to prove the relationship actually exists for the observed conditions.
  • Identifying Potential Causes and Contributors to Investigate – Once a logical, factually-based performance conclusion is reached, assessors seek to identify the applicable causes and contributors of the problem by developing and then validating an initial list of experience-based hypothetical causes and contributors. The priority order of validation is also based on the assessors’ past experience. Final report causes and contributors, however, are logically and factually validated and not simply an experience-based list.

General Rule of Thumb

In general, experience should be used as a starting point to identify priority focus areas and relationships; somewhat subjective steps of the assessment process. Follow-up with quantitative observations and logical, fact-based analysis is required to substantiate the experience-based suppositions thereby minimizing the possibility of a data gap and logic error that may lead to otherwise inappropriate conclusions.

Key Components Needed to Apply Experience

Those possessing relevant experience who have also learned how to properly apply their experience tend to recognize far more relationships (robust), faster (efficient) than those who do not possess this background. There are three key factors to consider:

  • Relevance – The experience must be relevant to the work (the self assessment in this case) being performed. This is not to suggest that the experience must be exactly aligned to be of benefit, in fact, the opposite is often true. The individual’s experience should be functionally (from the same business functional area such as finance, human resources, supply chain, information technology, etcetera) or operationally (possessing the same or similar operating elements such human performance, automation, process structure, etcetera) aligned and either organizationally (from the same organization), industrially (from the same or similar industry), or characteristically (possessing the same or similar operating elements such as regulations, hazards, etcetera) aligned. Possessing one or more different experience sets than those that naturally exist within the organization can yield highly beneficial insights not otherwise available to the organization’s leadership team.
  • Application Skill – The individual must be able to apply his/her experience to the work such that he/she is able to use it to recognize patterns, develop relationships, prioritize activities, etcetera. Applying one’s experience to a new data set for the expressed purpose of identifying patters, relationships, and priorities is a skill that needs to be learned, practiced, and mastered. While some individuals possess an extensive range of experiences, they are simply not able to leverage these to the self assessment process. Consequently, the value of this experience goes unrealized.
  • Application Willingness – The individual must be willing to leverage his/her relevant experience in performance of the work. An employee’s engagement and the organization’s culture greatly influence this. Some employees are disenfranchised with their organization and some cultures establish an employee’s unique knowledge and experience as representing his/her worth. In either case, these employees will not offer to apply their experience to the self assessment; robbing it of this value.

If any one of these factors is not met, the assessor’s experience will likely contribute very little to the overall assessment.

Preventing the Misapplication of Experience

Care must be taken to challenge assessors who appear to be ‘jumping to conclusions’ based on their past experiences. While experience helps speed relationship identification and understanding, arriving at a conclusion too quickly can be the sign of an opinion-based, experience derived finding. It is often beneficial to challenge all proposed conclusions with questions including:

  • What observations led you to that conclusion?
  • Did those observed agree with your account/interpretation of their performance?
  • How are these facts logically related?
  • What have you done to test the validity of your conclusion?
  • What feedback have you received from the manager being assessed?

These types of questions probe and challenge an assessor’s thinking and help reveal the inappropriate application of experience to the derivation of assessment findings.

Final Thoughts…

When determining a self assessment team’s composition, it is important to balance individual knowledge, skills, and experience to optimally review the in-scope performance area. One common mistake leaders make during this process is to equate an individual’s age or tenure with his/her experience level. Age simply reflects the amount of time an individual has enjoyed on this earth. Tenure simply reflects the number of days spent working within a particular organization(s). Neither directly equates to an experience level.

Experience should be judged based not only on the amount of time performing a specific task but on the success achieved performing that task under varying circumstances as well as the variety of activities the individual performed or was involved with over time and the success of each of these activities. When considering an individual’s experience, leaders need to also evaluate the individual’s skill and willingness to leverage his/her experience to advance the work assigned.

Let it also be concluded that a self assessment devoid of experience is unlikely to provide the organization the deep, rich insights needed to achieve next level performance. While there are dangers associated with the misapplication of experience, without it an assessment will not reflect the true wisdom needed to be of competitive value.[/wcm_restrict][wcm_nonmember plans=”25541, 25542, 25653″]

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In addition to receiving access to Business Performance Assessment Program – Use of Experience, you’ll help advance your career and business programs through anytime, anywhere access to:

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Return to the Business Performance Assessment Program Forum

About the Author

Nathan Ives, StrategyDriven Principal is a StrategyDriven Principal and Host of the StrategyDriven Podcast. For over twenty years, he has served as trusted advisor to executives and managers at dozens of Fortune 500 and smaller companies in the areas of management effectiveness, organizational development, and process improvement. To read Nathan’s complete biography, click here.