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Building out your data infrastructure? Why a data culture must come first

As businesses increasingly see the benefits of data-related investments and projects among their industry peers, it can be tempting for them to dive head-first into building out their data infrastructure with new analytics tools. However, embarking on a data journey is not as straightforward as simply making the purchase and sitting back to watch the rewards roll in. Optimizing the way your company leverages data requires a strong data culture, across all teams. In fact, Harvard Business Review found the biggest obstacles to driving data usage in organizations aren’t technical, as you might expect. They’re cultural.

Data culture occurs when data collection has become intuitive across departments, every team member understands the value of data analytics, and decisions of all kinds are data-driven first and foremost. Employees must feel empowered to leverage the data infrastructure that’s at their disposal.

Let’s dive deep into why prioritizing data culture above all else is the key to realizing the full potential of your data journey.

Data culture lets you do more with less. By incentivizing staff to become more data-driven, organizations are able to optimize their costs in newfound ways. In fact, the majority of the Fortune 1000 companies that use big data do so primarily to decrease business expenses.

With a data culture, employees are more likely to habitually track all possible metrics in areas such as sales, product use and expenses, uncovering patterns that they weren’t aware of before. Insights into things like the seasonal effect on sales or operational inefficiencies – the totality of which come only when a full data culture is realized – allow you to take action to optimize your resources. Such insights could result in improved customer targeting, clearer product roadmaps or more efficient supply chain management, all of which help you minimize unnecessary costs and maximize employee efforts.

Maximize ROI on infrastructure investments. Investing in data analytics is estimated to deliver an ROI of up to 1,300%, but this only occurs when a data culture is firmly established. Unfortunately, many organizations make big investments in their data infrastructure, such as migrating to a cloud provider, without leveraging the majority of the product. When a data-driven culture is embedded into an organization, companies are more likely to receive the full ROI of these investments as teams understand the value of all the features and know how to leverage them.

For example, let’s say an online retailer shifts their systems to a cloud provider such as Microsoft Azure. In addition to hosting those systems, Azure offers numerous products that might be of use to that business: The team could use Azure Data Factory to build effective data pipelines, or Azure Logic Apps for data preparation and to integrate with other cloud applications. However, without a widespread data culture, these functions could easily slip through the cracks as team members might not have the understanding of how the products could boost the value of the cloudification investment.

Boost employee morale and participation. Leveraging data across a business provides more clarity on organizational purpose as there are clear reasons for any new goals that are set, and performance on these goals is then tracked and measured in a transparent way. These metrics provide employees with a tangible way to see the purpose and results of their objectives and incentivize them to contribute collectively to the performance of the organization. This contrasts with companies that haven’t yet established a data culture, where decisions are often influenced by the disparate experiences and intuitions of people on the team. With quality data insights, there is a common language that brings people together over a mutual case, allowing teams to become stronger and build more unified relationships.

Let’s take an example. Prior to having a data culture, a team might have had different ideas over when to introduce a marketing lead into the sales funnel and at what rate to encourage them to progress through the funnel, based on their previous individual experiences. Armed with data on past leads and successful sales, teams can make clear comparisons between potential customers that entered the funnel at certain points and from that, understand which strategy is best. This brings them together behind a new, evidence-based approach and gets rid of the potential for dispute.

In addition, while a data culture works to unite team members around executive-level goals, it also enables them to make their own personal objectives data-driven. This empowers employees of all ranks to confidently guide daily business choices and play their own role in the overall success of the company.

So, you now know why it’s important to build a data culture. But what about the how?

How to Build a Data Culture

To promote data as a culture, your company’s top-level executives must lead by example. Leaders have to champion the use of data tools in their own decision-making and showcase how it leads to better results.

When it comes to less technical team members, you can use data visualizations and storytelling to make the insights more digestible, and thus easier to utilize. Data literacy is key, so at least a base level of training on the ways in which data insights can be translated into business actions will be a huge help for all team members. For those employees that are directly interacting with more technical analytics tools, specialized training will be necessary so they can maximize their potential.

Ultimately, implementing a data culture is a matter of mindset. Your team must feel empowered and encouraged to build a company-wide data culture, so incentivizing data use rather than forcing it will be key in forging a new approach.

The business benefits of leveraging data analytics are well-known. Departments across companies are realizing the power of data-driven decision-making and the value of investing in the tools to derive those insights. What’s clear, however, is the necessity of data culture in getting full ROI and empowering teams to use them to their full potential. By promoting a data culture from the top-down and allowing it to be built from the ground up, you can begin to reap the rewards of productivity, efficiency and participation that data use has to offer.