Welcome to the second blog on the Anmut Data Maturity Ladder. This blog will explain what we mean by the final three steps. Do read the first post ahead of diving in below.
A bit of context before the next stages
Many of you know that there has been a significant change in the underlying market value of listed shares over the past 40 years. This is illustrated very well by a study that Ocean Tomo published in 2017.
Regardless of whether you dispute or agree with their analysis, very few people would disagree that intangibles make up a significant part of company value. Also, very few would dispute that data makes up a very substantial portion of the intangible value.
Companies are very adept at managing the portfolio of businesses to shave off underperforming assets and acquire assets that will create more value. However, very few apply this same level of rigour to their data portfolio. It would be fair to say that only a very few understand that data is one of the most powerful parts of the portfolio. But for those that do, I have some good news. You now have the tools to manage the data, and this is where it starts.
STAGE 3: Information Managed
A stage three organisation has the basics of data management discipline in place. They have functioning governance structures, have good data quality management disciplines and there is a growing level of trust in the data of the organisation. These organisations are less likely to suffer embarrassing data losses, but also recognise that this could happen and have appropriate measures in place to deal with such an event.
The technology architecture is value and strategy driven. The business strategy, data strategy and technology strategy form an integrated whole and adequate resources are assigned to ensure capabilities are built to maximise value.
Concepts such as centres of excellence are well understood and analytics are being produced to support better decision making. There is little data mutiny on this ship. You may ask the question, could life get better than this? And it does.
STAGE 4: Informed Decision making
Organisations that have achieved stage four are happy data places and they go even further. These organisations understand that data is a powerful weapon that annihilates data weaklings. Decision-making processes are structured around data. Attributes that you will recognise from these organisations are:
- There is clear meeting governance that drives prioritised decision-making based on value priority. These aren't the type of organisations that spend equal time discussing the broken down coffee machine and the innovation strategy.
- They are not shy of radical transparency. Ray Dalio is a big proponent of sharing personality types and being open about your personal decision style. At Anmut we do the same and it makes for a much more effective team. People in these organisations are comfortable with themselves and realise it is better for all to be transparent. Radical transparency works when we discuss facts, not people.
- The Analytic is the decision-maker. Many organisations have expressives and drivers making the decision. The analytics typically are the ones carrying the reams of paper to answer questions the big talkers have. Stage four organisations recognise you need all sorts, but an analytic is best able to listen to all and crystallise a decision.
- Data is valued. Not just in a colloquial way, but we actually measure the value of the data as we would with plant and machinery... or coffee machines.
- Fifth on the list, but critically important, Performance management recognises and rewards good data management and outcomes. There are many things at play here, the resource allocation process, fondly known as budgeting and planning by many, employee performance, including goal-setting and review. This is the glue that brings it all together.
STAGE 5: Trust and transparency
You may ask why Trust and Transparency is so important? My answer is simple, you will not be able to sell the new and innovative product or service if your customers don't trust you. You will not be able to build the new and innovative product if your employees don't trust you that they will be treated fairly for doing something that cannot be measured today. You will eventually erode your license to trade if you don't create an open and transparent management and information model.
At this stage, the organisation has made transparency a core value upon which its internal and external operations are built. It communicates its vision and mission statement regularly, openly and sincerely. It dispenses important information promptly to stakeholders and avoids lies or distortions of the truth. A culture of trust is beginning to grow within and around the organisation. Employees are informed of key decisions and report high levels of satisfaction, engagement and fairness in the workplace. Shareholders understand the direction of the organisation and have faith in the leadership to execute. Key stakeholders are part of the organisational eco-system, not the enemy.