Data democratization: Three critical elements for the CEO agenda

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Informational power brokering, lack of business use cases, and fragmented analyses can cripple an organization trying to gain relevant answers from its data.

One of the most exciting business trends to gain traction this year is new technology that enables managers and staff in end business units to tap into big data and perform analytics. They do this by using software that can automatically perform many of the data preparation and cleansing processes for non-traditional data to make that data ready for non IT-user designed queries and analytics reports.

The value to enterprises can be immediate. Not only do the end business units get their data faster than if they had to go through IT--but they have the potential to get more relevant answers back for the business because they already have important business knowledge and experience that they can bring into their data explorations.

As business leaders, CEOs should promote this kind of open and democratic spirit of inquiry. It has the potential to get the most out of the finest minds throughout the organization. However, there is also a significant caveat to data democratization: It has to be carefully managed--and that management has to start with the CEO.

Just what issues and risks require management?

The information-is-power syndrome

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Companies consist of people--and whenever you start ranking them into an organizational structure there are politics to contend with. As long as businesses have existed, access to important information has functioned as a political tool. It isn't always politically advantageous to share information, especially if you can get to the CEO first with your special information and enhance your career. Because of this internal power brokering through information, CEOs must step in to change the culture. They have to place new value on information sharing--and they have to walk the walk. This isn't always easy.

SEE: Job description: Data scientist

The conversion of information into business meaning

Far too many organizations fail to establish concise business cases they can point their analytics at. This danger can perpetuate when different departments within the company go off on their own data forays. What is important on a day-to-day basis to a staff accountant or purchasing buyer might not deliver ultimate big-time value to the company.

The risk of getting a wrong answer

There is a lot at stake for companies if they take action on inaccurate or incomplete conclusions from their analytics--and those actions are wrong. How does this happen? Let's say that finance independently determines from its analytics that the company is not getting its receivables fast enough, and that this is affecting revenue recognition and cash flow. Finance recommends steps that can be taken to correct the deficiencies and presents it to the CEO.

However, unbeknownst to both finance and the CEO is another independent data analytics effort that customer service is conducting. The analytics show that the same customers who are delaying payments have product issues that are still unresolved. If the two different findings aren't assembled into a 360-degree picture of what's really going on, the company risks losing customers.

The moral of the story is that somewhere, the independent research of these two departments must be brought together into a holistic picture of what is truly going on in the business and how the company should respond. If that doesn't happen, the company could make a poor business decision.

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Steps for CEOs to take

Where it is required, a culture change regarding information sharing should be at the top of every CEO's list. One technique that can help effect this change is to modify the focus of meetings when multiple departments are involved--what companies usually call "interdisciplinary meetings." But they should really be called "business-case meetings," with the goal being to unilaterally address a business problem and bringing everyone's knowledge to bear. This creates free information flow because people begin to get recognized for actively engaging in problem solving--not for bringing sequestered information to the CEO.

Second, when information conflict arises (as in the finance versus customer service example), it's up to the CEO to ensure that information resolution occurs in a way that best solves a specific problem. With a business-case team comprising different disciplines, chances of problem resolution are enanced because you have all the information sources and experts in one room.

In all cases, the goal is to get the organization engaged in active information sharing to solve real life business problems. This eliminates the creation of new "information fiefdoms" and silos--which is the last thing you want to create as analytics gets democratized.

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