An Insight into the Data-Driven Mind of Executives

Are you an executive? This is for you. You have to understand your key role in your company or your department.

By its term, executive is tasked to execute. Your main job is to guide your company in making decisions. You are expected to make good decisions most of the time. Since you make decisions, it is time to ask your self: "Are my decisions based on facts?" "Do you know exactly know which lever to pull to at least change the course of your company's future by using the right metrics?"

Analytics provides insights. If you want to formulate good decisions, then you have to use analytics. It could be that you are asking yourself right now: "How often will you use insights?" "What is an insight?"

THE CHALLENGE OF EXECUTIVES

The challenge most companies face is that their executives do not use analytics in their decision. In 2018, Forbes Insights, the strategic research and thought leadership practice of Forbes Media, along with Treasure Data, conducted a study entitled "Data Versus Goliath: Customer Data Strategies to Disrupt the Disruptors." The respondents were 400 executives across industry segments. They were asked how they used data to disrupt their respective industries. Believe it or not. It was found out that only 13% of them used data to leverage their customer demands. It can be noted that there is really a big gap between the competency and the expertise as to the maximization of data and the insights gathered.

What is astonishing about the study is that most of these organizations are still at the beginning stage of data implementation. They are still in the process of looking and honing for talents that can help them become data-centric companies.

The study simply shows that executives do not really value insights. Or they do not really know what insight is. I believe that these companies have analysts, but executives do not put much premium on the data presented to them.

Predictive analytics is about the future. Insights from this form of analytics can bring an edge, a disruption, to a certain industry. Why do the analysts of these industries not guide their senior executives? It might be even be that these analysts do not have proper grasp of an insight. They may not even know what these executives need.

WHAT IS AN INSIGHT

A lot of times when you attend a meeting, you would hear these statements:

• 95% of the customers are millennial.
• Our product is the top performing product in the region.
• Our revenue has increased by 10% .
• The trend does not change.

The last statement is very disturbing. This can be treated as an observation and not as an insight.

An insight contains new information which must be new, relevant and non-trivial. At times, this can be counter-intuitive that offers the most challenging and interesting findings. It is more than a mere observation. The last statement is of less importance and does not offer something new. This is just a mere observation.

The idea is customer-centric. The focus of the insight should be understanding customer behavior. This is the crux of marketing. If it is not all about customer, then it must be something else like finance, human relations, infrastructure and many more. Let us remember that the focus of marketing is incentivizing and understanding your customer for a win-win solution. Understanding your customer journey is very valuable in the decision making process.

An insight has to show cause-effect relationship and should be capable of quantifying this relationship. It must be able to quantify the effects of one variable to another variable. For example, you will be able to measure the effects of the changing of packaging to the number of units sold within certain segments. With this, you will be able to know which lever to pull so as to trigger a change.

An insight has to provide a competitive advantage. It must be a certain piece of wisdom your competitor do not have. Having certain piece of information, your will be able to make intelligent decisions because you are aware of the changes in the market.

An insight should also offer financial implications. This is after all the product of one's decision, lest you company be closed due to bad or wrong decisions. If the result is not monetarily acceptable, at least on a company's standard, the validity of the decision can be questioned.

Lastly, an insight is about action-ability. Of course, this should provide what you need to make proper decisions. You must be able to perform a certain task. For example, based on the insights, your customers demand that your packaging should be environmentally friendly and they are willing to pay for the additional charge. This provides you concrete things to do.

An executive must execute, and must make decisions. If these decisions are based on data, there is a great chance that he makes a right decision. If you are an executive, you must know this.