Feb
06
2019
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Big companies are not becoming data-driven fast enough

I remember watching MIT professor Andrew McAfee years ago telling stories about the importance of data over gut feeling, whether it was predicting successful wines or making sound business decisions. We have been hearing about big data and data-driven decision making for so long, you would think it has become hardened into our largest organizations by now. As it turns out, new research by NewVantage Partners finds that most large companies are having problems implementing an organization-wide, data-driven strategy.

McAfee was fond of saying that before the data deluge we have today, the way most large organizations made decisions was via the HiPPO — the highest paid person’s opinion. Then he would chide the audience that this was not the proper way to run your business. Data, not gut feelings, even those based on experience, should drive important organizational decisions.

While companies haven’t failed to recognize McAfee’s advice, the NVP report suggests they are having problems implementing data-driven decision making across organizations. There are plenty of technological solutions out there today to help them, from startups all the way to the largest enterprise vendors, but the data (see, you always need to go back to the data) suggests that it’s not a technology problem, it’s a people problem.

Executives can have farsighted vision that their organizations need to be data-driven. They can acquire all of the latest solutions to bring data to the forefront, but unless they combine that with a broad cultural shift and a deep understanding of how to use that data inside business processes, they will continue to struggle.

The study’s authors, Randy Bean and Thomas H. Davenport, wrote about the people problem in their study’s executive summary. “We hear little about initiatives devoted to changing human attitudes and behaviors around data. Unless the focus shifts to these types of activities, we are likely to see the same problem areas in the future that we’ve observed year after year in this survey.”

The survey found that 72 percent of respondents have failed in this regard, reporting they haven’t been able to create a data-driven culture, whatever that means to individual respondents. Meanwhile, 69 percent reported they had failed to create a data-driven organization, although it would seem that these two metrics would be closely aligned.

Perhaps most discouraging of all is that the data is trending the wrong way. Over the last several years, the report’s authors say that those organizations calling themselves data-driven has actually dropped each year from 37.1 percent in 2017 to 32.4 percent in 2018 to 31.0 percent in the latest survey.

This matters on so many levels, but consider that as companies shift to artificial intelligence and machine learning, these technologies rely on abundant amounts of data to work effectively. What’s more, every organization, regardless of its size, is generating vast amounts of data, simply as part of being a digital business in the 21st century. They need to find a way to control this data to make better decisions and understand their customers better. It’s essential.

There is so much talk about innovation and disruption, and understanding and affecting company culture, but so much of all this is linked. You need to be more agile. You need to be more digital. You need to be transformational. You need to be all of these things — and data is at the center of all of it.

Data has been called the new oil often enough to be cliché, but these results reveal that the lesson is failing to get through. Companies need to be data-driven now, this instant. This isn’t something to be working toward at this point. This is something you need to be doing, unless your ultimate goal is to become irrelevant.

Oct
17
2018
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PwC staves off disruption with immersive emerging tech training

The big accounting firms are under pressure from digital disruption just like every industry these days, but PwC is trying a proactive approach with a digital accelerator program designed to train employees for the next generation of jobs.

To do this, PwC is not just providing some additional training resources and calling it a day. They are allowing employees to take 18 months to two years to completely immerse themselves in learning about a new area. This involves spending half their time on training for their new skill development and half putting that new knowledge to work with clients.

PwC’s Sarah McEneaney, digital talent leader at PwC was put in charge of the program. She said that as a consulting organization, it was important to really focus on the providing a new set of skills for the entire group of employees. That would take a serious commitment, concentrating on a set of emerging technologies. They decided to focus on data and analytics, automation and robotics and AI and machine learning.

Ray Wang, who is founder and principal analyst at Constellation Research says this is part of a broader trend around preparing employees inside large organizations for future skills. “Almost every organization around the world is worried about the growing skills gap inside their organizations. Reskilling, continuous learning and hand-on training are back in vogue with the improved economy and war for talent,” he said.

PwC program takes shape

About a year ago the company began designing the program and decided to open it up to everyone in the company from the consulting staff to the support staff with goal of eventually providing a new set of skills across the entire organization of 50,000 employees. As you would expect with a large organization, that started with baby steps.

Graphic: Duncan_Andison/Getty Images

The company designed the new program as a self-nomination process, rather than having management picked candidates. They wanted self starters, and about 3500 applied. McEneaney considered this a good number, especially since PwC tends to be a risk-averse culture and this was asking employees to leave the normal growth track and take a chance with this new program. Out of the 3500 who applied, they did an initial pilot with 1000 people.

She estimates if a majority of the company’s employees eventually opt in to this retraining regimen, it could cost some serious cash, around $100 million. That’s not an insignificant sum, even for a large company like PwC, but McEneaney believes it should pay for itself fairly quickly. As she put it, customers will respect the fact that the company is modernizing and looking at more efficient ways to do the work they are doing today.

Making it happen

Daniel Krogen, a risk assurance associate at PwC decided to go on the data and analytics track. While he welcomed getting new skills from his company, he admits he was nervous going this route at first because of the typical way his industry has worked in the past. “In the accounting industry you come in and have a track and everyone follows the track. I was worried doing something unique could hinder me if I wasn’t following track,” he said.

Graphic: Feodora Chiosea/Getty Images

He says those fears were alleviated by senior management encouraging people to join this program and giving participants assurances that they would not be penalized. “The firm is dedicated to pushing this and having how we differentiate this against the industry, and we want to invest in all of our staff and push everyone through this,” Krogen said.

McEneaney says she’s a partner at the firm, but it took a change management sell to the executive team and really getting them to look at it as a long-term investment in the future of the business. “I would say a critical factor in the early success of the program has been having buy-in from our senior partner, our CEO and all of his team from the very start,” She reports directly to this team and sees their support and backing as critical to the early success of the program.

Getting real

Members of the program are given a 3-day orientation. After that they follow a self-directed course work. They are encouraged to work together with other people in the program, and this is especially important since people will bring a range of skills to the subject matter from absolute beginners to those with more advanced understanding. People can meet in an office if they are in the same area or a coffee shop or in an online meeting as they prefer.

Each member of the program participates in a Udacity nano-degree program, learning a new set of skills related to whatever technology speciality they have chosen. “We have a pretty flexible culture here…and we trust our people to work in ways that work for them and work together in ways that work for them,” McEneaney explained.

The initial program was presented as a 12-18 month digital accelerator tour of duty, Krogen said. “In those 12-18 months, we are dedicated to this program. We could choose another stint or go back to client work and bring those skills to client services that we previously provided.”

While this program is really just getting off the ground, it’s a step toward acknowledging the changing face of business and technology. Companies like PwC need to be proactive in terms of preparing their own employees for the next generation of jobs, and that’s something every organization should be considering.

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