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Using Powerful Questions to Drive Your Information Strategy

We've moved from a world of data scarcity to nearly unlimited accessibility and availability of information. Systems and technology have rapidly advanced as well, but firms are still seeing mixed results. This presentation discusses why we need to focus on better questioning and actionability as the core of an information strategy.

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Using Powerful Questions to Drive Your Information Strategy

  1. 1. Using Powerful Questions to Drive Your Information Strategy May 29, 2015 Rob Saker Chief Data Officer
  2. 2. Drought 2 A lack of information will lead to the death of your organization.
  3. 3. Flood 3 Too much unfocused data can have a similar result.
  4. 4. 4 How do you provide focus to your information needs? When focused, water has the power to cut through steel Pictured at right is a 5-axis water jet cutting head that pressurizes water to up to 100,000 PSI. Source: http://en.wikipedia.org/wiki/Water_jet_cutter
  5. 5. Why the focus on questioning? 5 The signs that led to a focus on enquiry 23,000. Number of syndicated reports and variations that were proliferated at large CPG manufacturer. Lack of clarity. “Capture everything” leading to debates about source instead of relevance. Systems, maintenance and acquisition. Increase in data leading to growth in costs. Rapid expansion in tools to exploit information. HANA, R, Hadoop, NoSQL, Logical data warehouses, in- memory appliances. 70. Number of distinct data sources incorporated into recent analytic model. Desire to transform business models. Companies needing to transform, but being constrained by data and technical debt. We have made the shift from scarcity to abundance of information, without corresponding progression in our design approach.
  6. 6. 6 Your great subtitle in this line “What unique resource strengths does St. Petersburg have over every other city in the world?” Russian Offshore Technology Firm
  7. 7. Brewer Metric Standardization 7 EBIDTA Net Producer Revenue Cost of Sales COS Variable Freight & Fuel COS Fixed1,200Team identified, rationalized, and standardized metrics down to a list of 1,200 from brewery operations to consumer insights. Metrics 7 Identified 7 key performance indicators that we believe we need to control to drive the strategic objectives. Topline KPIs 1.5 Amount of time it spent beginning to end to drive adoption of the idea, not including metric standardization. Years Marketing Spend SG&A National Spend Local Spend
  8. 8. CROSSMARK IS THE SMARTER WAY TO FASTER GROWTH. Crossmark sits in a unique position in the market with direct engagement across manufacturers, retailers and consumers. Consumers Retailers Manufacturers • Digital, social, experiential, affinity, panel, consumer incentives • Hundreds of thousands of direct engagements • Millions of loyalty/affinity card members Helping manufacturers activate their products with retailers and consumers. • Planning, forecasts, sales to retailer, promotion, digital Helping retailers manage their store activities. • POS, assortment, planograms, beacons, loyalty, digital. • Billions of direct observation data points at retail per year Manufacturer Data Consumer Data Retailer Data
  9. 9. 9 “The people who don’t ask questions remain clueless their whole lives.” - Neil deGrasse Tyson
  10. 10. Questioning and Our Brain 10 Divergent Thinking Taps into the right hemisphere of the brain that drives random pattern association. Political Bias When faced with a difficult mathematical question, people revert to their political bias. Fight Against Intuition Cognitive scientists have published studies showing that people are unwilling to accept controversial ideas that contradict their previous intuition. 4 year olds They ask 390 questions a day, but that will be the high point in their lives.
  11. 11. Questioning is an Unlearned Behavior 11 Our education processes discourage inquiry. • Questioning isn’t taught in school • We reward students on developing “expertise,” which we define as memorization of facts. • We hire people with advanced degrees who are “experts” in their field to drive our critical projects. Companies invest in candidates with advanced degrees and expertise. An expert is someone who has mastered a subject and therefore doesn’t need to ask questions.
  12. 12. Consulting & Development Methodologies Discourage Questioning 12 Business Process How will we integrate? How will we do our work? Vision Where do we want to compete? Measurement Lorem ipsum dolor sit amet, consectetuer adipiscing elit Implementation Strategy How will we differentiate ourselves? Development
  13. 13. Organizational Inertia 13 99% Where your business lives day-to-day Organization behaviour is a real world example of regression to the mean. Existential threat Ground breaking innovation
  14. 14. 14 What is the cost of poor questioning?
  15. 15. Increased Time to Value 15 Complexity increases the duration of every task Month 1 Month 2 Month 3 Month 1 Month 2 Month 3 Month 4 Month 5 Month 7 Month 8 ~7 month project Complex approach 6 Weeks Define 4 weeks Develop 2 days data 3 weeks Test 3-4 weeks Rework 2 weeks Tune 2 weeks Backload 4 weeks Volume Test 2-3 weeks Report 2 weeks Implement Focused approach ~3 month project 4 weeks Define Design Data modelling Data acquisition 4 weeks Develop/Test/Rework ETL development Data replication Database development Unit testing, integrated testing Statistical analysis modeling Tune Index build and rebuild Aggregation and embedded calculation optimization Testing and tuning 2 weeks Report development Volume Test Data refresh End user acceptance 1-2 weeks Implement Physical model replication Testing Backload No backload, as all dev and testing against full data volumes
  16. 16. Increased Ongoing Total Cost of Ownership 16 Maintaining data complexity reduces operational efficiency Data systems Additional server & storage costs Additional Support Resources Maintenance of additional indexes & aggregates Maintenance of additional ETLs Software costs as you upgrade to faster CPU’s Additional costs associated with growth of data, its complexity and the compounding nature of such issues Loss of business productivity Inefficiency costs + + + + + + Over-buying data +
  17. 17. Complexity Decreases Productivity 17 In absence of precision firms capture everything Requiring users to enter extra data greatly decreases productivity and requires greater change management to enable.
  18. 18. 18 Nest Why can’t the “unloved objects” in homes be smarter? Box.com Why can’t I access my files anywhere? Amazon How do we remove friction in the path to purchase? Waze How can we optimize travel through real-time traffic information? Mint.com How can we simplify and enrich personal finance? Uber More tightly manage supply and demand between drivers and riders. Missed Opportunity Costs Dwarf Productivity Losses
  19. 19. In an interview with Fortune, Jeff Bezos indicated that meetings with his senior executive team at Amazon begin with reading 6 page memos for up to 30 minutes. Participants spend this time absorbing every word. “They have verbs. The paragraphs have topic sentences. There is no way to write a six-page, narratively structured memo and not have clear thinking.”
  20. 20. On the Kindle “Books, in my view, are too expensive. Thirty dollars for a book is too expensive. If I'm only competing against other $30 books, then you don’t get there. If you realize that you’re really competing against Candy Crush and everything else, then you start to say, “Gosh, maybe we should really work on reducing friction on long-form reading." That’s what Kindle has been about from the very beginning.” • Amazon Prime • 1-click ordering • Pro-active shipping before items are ordered • Dash buttons • Same day delivery • Two hour delivery • Drone delivery “How do we remove friction in the path to purchase?” 15,000% TSR Total shareholder returns since 1997 IPO. $90 Billion Total sales in 2014. 426 Number of items sold per second on 2013 Cyber Monday
  21. 21. 21 “Effective leaders ask questions instead of giving orders.” - Dale Carnegie, “How to Win Friends and Influence People”
  22. 22. THIS GENERATES ANSWERS AND DRIVE BUSINESS DECISIONS. THIS GENERATES ANSWERS AND DRIVE BUSINESS DECISIONS. 22
  23. 23. What is a powerful question? 23 They clearly define the issue Powerful questions clearly articulate the problem. They do not attempt to solve multiple unknowns simultaneously. They drive outcomes Powerful questions drive decisions and outcomes. A question without an outcome is trivia. Tips for developing effective and objective questions. They are simple Complex language and terminology is used to mask a lack of understanding. Good questions are simple and spoken in a language everyone can understand. They are objective They do not impose a bias on the inquiry process.
  24. 24. Inquiry Process 24 Diverge Used to explore possibilities outside of the initial frame. Strategic Framing Identifying the key problem or opportunity facing the business. Factual/Evaluative Questions whose results can be directly measured. Converge Used to constrain questions after divergence to those which best align with the business objective. Create Choices Make Choices
  25. 25. “What business am I in? Or, what business should I be in tomorrow?” Framing Questions 25 These questions should be tied to your overall corporate strategy. • You must know who your customer is and their value to you. • A detailed assessment of the value you provide to them. • What business problem are we trying to solve? Useful Types of Data • CRM data, with enrichment to enable classification • Financial data • Sales data, with enrichment to enable classification
  26. 26. Divergent Questions 26 Divergent questions explore additional possibilities to ensure we have appropriate framed the question and explored adjacent possibilities. • Sales of soda vs. “share of stomach” ensures that beverage firms don’t become narrowly focused. Additional Types of Data • Industry sales • PESTLE trends (Competitive, Economic, Political, Legal/Regulatory, Technological, Sociocultural) “If I had asked my customers what they wanted, they would have asked for a faster horse.” - Henry Ford
  27. 27. Convergent Questions 27 Convergent questions focus and prioritize those which are most likely to have a significant impact. • Quantify by the size of impact and probability and prioritize Additional Types of Data • Evaluative analysis for sizing and probability
  28. 28. Factual Questions 28 Factual questions are those that have a direct answer. • Processes must be designed at the beginning to measure the answer to these questions. Additional Types of Data • Observation data
  29. 29. Question Inventory Matrix 29 Problem/ Hypothesis/ Question Possible Driver or Cause Analysis/Tool/ Model Data (What data set(s) best explains it?) Timing/Avai lability Responsible (Synthesizes Analysis) Accountable (Decides) Decision to Drive Deadli ne What is the incrementality of a new product launch? (EXAMPLE) Media awareness Marketing Mix Sales, Distribution, Media Actuals 2 months after event Marketing Analysts Brand Director Do we need to change our investments in the new product? Should we launch? 1/31/2 015 Distribution Distribution incrementality analysis Nielsen, POS, Manu Sales to Retailer (STR) Week after event Sales Analyst Sales Director Should we launch the product? Distribution execution & effectiveness Store audits, Nielsen, POS Week after event Sales Analyst Distribution Manager Where should we focus our distribution efforts?
  30. 30. Conceptual Enterprise Business Matrix 30 Point of Sale Wholesale Data Distribution Data Media Planning Data Promotional Spend Store Audit Data Marketing Mix Analysis Yes Yes Yes Yes Yes No Distribution Incrementality Yes Yes Yes No No No Distribution execution Yes Yes Yes No No Yes Analysis 4 Yes No Yes No No No Analysis 5 Yes Yes Yes Yes Yes No Analysis 6 No Yes No No No Yes Capture, generate or acquire data once in a way that satisfies across all questions.
  31. 31. Conceptual Enterprise Business Matrix 31 Point of Sale Wholesale Data Distribution Data Media Planning Data Promotional Spend Store Audit Data Marketing Mix Analysis Yes Yes Yes Yes Yes No Distribution Incrementality Yes Yes Yes No No No Distribution execution Yes Yes Yes No No Yes Analysis 4 Yes No Yes No No No Analysis 5 Yes Yes Yes Yes Yes No Analysis 6 No Yes No No No Yes Model in a way that integrates data once for use across multiple questions.
  32. 32. Validation Process 32 Measuring and analyzing the results are fundamental to improving an organization over time. Repeat Measurement Continue measuring results. Measure Did the result match expectations? Repeat Continue executing against your hypothesis to capture a representative sample of data. Execute Lorem ipsum dolor sit amet, consectetur adipiscing elit sed do eiusmod aliqua. Analyze START Measure results Execute against hypothesis Execute against hypothesis Measure results
  33. 33. 33 Key Takeaways Focus on Questions that Drive Objectives Remember that actionability is the key test of a powerful question. Frame/Diverge/Converge Use the frame/diverge/converge process to ensure you aren’t becoming predictable or stale. Tie Business Questions to Data Design Use questions to tie to your enterprise data design. Measure Questions should be designed in a way that allows for measurement, and measurement should be built into the design of processes. Refine Questions Over Time Businesses are not static, nor should the questions we use to drive them. Analyze your ability to answer questions at regular intervals and refine them.
  34. 34. 34 THANK YOU Rob Saker Twitter: @robsaker rob.saker@crossmark.com Sources and additional reading: “How to Win Friends & Influence People,” Dale Carnegie http://www.amazon.com/How-Win-Friends-Influence-People/dp/1508569754 “A More Beautiful Question,” Warren Berger http://www.amazon.com/More-Beautiful-Question-Inquiry-Breakthrough/dp/1620401452 “Before You Innovate, Ask the Right Questions,” HBR. https://hbr.org/2013/02/before-you-innovate-ask-the-ri “The Second Machine Age,” Andrew McAfee, Eric Brynjolfsson, http://www.amazon.com/The-Second-Machine-Age-Technologies/dp/0393239357 “Inmon vs. Kimball – An Analysis,” Nagesh. http://www.nagesh.com/publications/technology/173-inmon-vs-kimball-an-analysis.html “Relentless Practical Tools for Data Warehousing and Business Intelligence,” Ralph Kimball, Margy Ross. http://www.amazon.com/Kimball-Group-Reader- Relentlessly-Intelligence/dp/0470563109/ref=sr_tc_2_3?ie=UTF8&qid=1432841651&sr=8-2-ent “Amazon’s Jeff Bezos, the Ultimate Disrupter,” Adam Lashinsky, http://fortune.com/2012/11/16/amazons-jeff-bezos-the-ultimate-disrupter/

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