Better decision-making through more data is ludicrous?
“better decision-making through more data is ludicrous” — someone actually wrote this: here.
The author criticized IBM’s Business Intelligence maturity model, suggesting that it was a ploy to get people to buy more IBM hardware and software. He further argued technology traps executives into making poor assumptions and decisions.
Well there’s one kind of extremism and then there’s another. I agree that data without context is inappropriate, but lack of data, or incomplete data surely leads to poor decisions.
Many businesses have found competitive advantage through organizational alignment around data, and the flow of information from stores through the organization and to suppliers. Nestle, Walmart, Nike, McDonalds, the list goes on. Would the CEO of Walmart be able to manage his multi-billion dollar organization solely through anecdotal reports from Joe store clerk?
Properly designed information systems take the technology provided by vendors like IBM, SAP, Microsoft, etc., and use it as a platform for sharing information. Note that I distinguish between information and data. Corporate transactional data is an important part of information, and the story doesn’t stop at a canned report. The report (or executive dashboard) should serve to highlight the potential for a problem, and provide a route to more detailed information (including contextual information) about the problem, while exploring and asking questions.
Like it or not, the business world revolves around numbers. And businesses, rightly, set targets around the numbers they want to achieve. Without data, businesses would be unable to measure performance against targets, judge success of strategies, and implement corrective action.
Its the Business Intelligence processes, technology and staff that collect data from various parts of the organization, make sense of it, and present it to those who make decisions. Hopefully they can automate most of the process to make it more efficient – and yes, they probably have to buy software/hardware to do so, but at least they relieve hundreds or thousands of employees from crunching numbers in Excel, and let them get on with their real jobs.
The promise for Business Intelligence is a huge competitive advantage but it’s hard to achieve without the proper approach. Companies that fail in their BI efforts often do so because they (a) lack definition about what they need to measure, (b) fail to define the business case for each BI project – i.e. “improving inventory visibility will save $X in labour, and improve order fulfillment times by Y%, earning the company an ROI of AAA”, (c) implement disjointed point solutions that fail to improve information flow between departments or (d) have an inadequate overall strategy for BI
-IainR
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There are 1 Comments to "Better decision-making through more data is ludicrous?"
I don’t mind data, but it doesn’t give people context to make decisions. Data alone is the problem, yet, too many organizations rely on the wrong data. Usually functional through KPIs and financials. This , of course, is ridiculous. Data is not knowledge, let’s not confuse the two -W. Edwards Deming
Targets on the other hand are ridiculous. They get everyone’s attention . . . yes. The problem is they become the defacto purpose. Here’s a post to chew on:
http://blog.newsystemsthinking.com/target-obsession-disorder-tod/