Creating a Data-Driven Organization

Chapter 1. What Do We Mean by Data-Driven?

Without data you’re just another person with an opinion.

William Edwards Deming

Data-drivenness is about building tools, abilities, and, most crucially, a culture that acts on data. This chapter will outline what sets data-driven organizations apart. I start with some initial prerequisites about data collection and access. I then contrast reporting and alerting versus analyses in some detail because it is such an important distinction. There are many different types of forward-looking analysis, varying in degrees of sophistication. Thus, I spend some time going over those types, describing them in terms of “levels of analytics” and “analytics maturity,” in particular, discussing the hallmarks of an analytically mature organization. What does that look like?

Let us start us on the way to answering our first question: what does it mean for an organization to be data-driven?

Data Collection

Let’s get a couple of obvious prerequisites out of the way.

Prerequisite #1: An organization must be collecting data.

Data undoubtedly is a key ingredient. Of course, it can’t just be any data; it has to be the right data. The dataset has to be relevant to the question at hand. It also has to be timely, accurate, clean, unbiased; and perhaps most importantly, it has to be trustworthy.

This is a tall order. Data is always dirtier than you imagine. There can be subtle hidden biases that can sway your conclusions, and cleaning and massaging data can be ...