Most of the talk about using Big Data and Analytics effectively seems to focus on its technical aspects. Do you need a data warehouse or data lake? Should you be using R and Hadoop or some other technology?
It’s true that data analytics has gotten complex. It takes considerable skill to manage large data sets and even greater skill to tease our their insights.
However, in working with leaders, I’ve found three skills that are even more important. Without them, having a strong analytics capability won’t deliver much value. The three key skills are: communication, critical thinking, and business acumen.
Communication
Leaders who excel at using data effectively don’t talk much about the data. They are able to turn insights from the data into simple, clear, and compelling recommendation and decisions. The data is important to ensure that what they are saying is factually correct. However, it’s the story and argument that compel others to act. Leaders who simply provide data dumps actually slow down the decision making process.
Additionally, disagreements over “data” often aren’t about the data or analysis. They come from a failure to create shared understanding of the problem, and more importantly the criteria being used to solve that problem. If two leaders have different criteria for making a decision, they are going to be hard pressed to come to an agreement, even when viewing the same data. A key job of a leader is to help the team reach a common understanding of not only what problems are being solved but how the proposed solutions will be evaluated and judged.
Critical thinking
The quality of an analysis is driven by how well the problem was defined in the first place. Many leaders struggle to clearly define a simple problem or question. They either define their questions too generically (“What’s going on in my department”?) or fail to create a question that can drive action. Too often leaders simply ask analysts to show them all of the available data on a given topic. That’s not an effective way to use data. Creating questions that are specific and meaningful is a critical skill for using data effectively.
In addition to framing a problem, it is also essential that leaders know how to question results. In my workshop, I’m often surprised by the number of leaders who can’t think of a counter-argument to their recommendation. If you can’t think through a problem or issue from multiple perspectives, you leave yourself wide open to your or others’ biases. Many leaders also struggle to question (or even understand) the assumptions that were made in framing the data collection and analysis. This puts them at the mercy of the decisions that the analyst made while running the data.
Business acumen
Insight and meaning come from placing data into the context of your business. To make sense of an analysis, a leader has to have a strong understanding of his or her business. About half of the calls that I receive for helping leaders with “data” turn out to be business acumen issues. The leaders have no trouble identifying the problem areas on their reports. Their issue is that they have no understanding of what typically causes that kind of problem or the levers they can pull to resolve it. That’s a business acumen issue, not a data issue.
If your leaders don’t have a deep understanding of how their business works, they are going to struggle to interpret and act upon their data.
Analytics is a difficult field and requires considerable skills. However, realizing the value of analytics is about leadership and decision making. If your leaders don’t understand your business, can’t frame a problem, and are unable to turn data into a decision or action, you will not get much value from your analytics.
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Brad Kolar is an Executive Consultant, Speaker, and Author with Avail Advisors. Avail’s Rethinking Data workshop helps leaders drive more efficient and effective data-driven decision making.
