Everything runs on principles. Success runs on principles. Effective organisation are effective because they do understand and implement principles.
A principle by definition is a law that governs a function.
This is the question that every serious business leader asks. What makes an effective organisation. This week I want to take you through principles that make effective businesses.
Brian Tracy often says success leaves trails. What this means is that you want to be successful study successful people, do what they do and you will be successful. The reverse is true, study failures, and avoid doing what they did and you will be successful.
#1. Develop Data Culture
In 2006, British mathematician Clive Humby declared that, “Data is the new oil”. Clive Humby, a Sheffield mathematician who with his wife, Edwina Dunn, made £90m helping Tesco with its Clubcard system.
Though he said it in 2006, the realisation that there is a lot of money to be made — and lost through the careful or careless marshalling of “big data” has only begun to dawn on many business people.
Humby’s analogy has been proven correct as data now powers entire industries and holds tremendous value — but if left unrefined, is effectively worthless.
Michael Palmer, of the Association of National Advertisers, expanded on Humby’s quote: “Data is just like crude. It’s valuable, but if unrefined it cannot really be used.
“It has to be changed into gas, plastic, chemicals, etc to create a valuable entity that drives profitable activity; so must data be broken down, analysed for it to have value.”
Effective organisations realise that data is the new oil, and Peter Drucker’s immortal advice that, “culture eats strategy for breakfast”. You need to combine the two, and build a high-performance culture around trust, accountability and data-driven decisions. Make hitting numbers a game for your teams.
Without doubt, data in the 21st Century is like oil in the 18th Century: an immensely, untapped valuable asset.
Oil is one of the most important resources for humanity. In this era however, of the fourth industrial revolution, which involves innovation, technology and artificial intelligence, a new oil has emerged.
Data is the new oil of the digital era. We’re in a digital economy where data is now more valuable than ever. It is the key to the smooth functionality of everything from the government to local companies. Without it, progress would halt.
The value of processed data
When data is processed, analysed and utilised efficiently and instantly, it will have a much greater value. The same applies to crude oil, which is worth more when transformed into more constructive objects. Data is usually analysed for insights to help organisations make informed decisions and adjust their strategy.
The volumes of data created and used in making business decisions support the thriving big data companies and have a great impact on many industries, both government and non-government, including education, tourism, banking and e-commerce, healthcare, finance and more.
Your organisation needs to leverage data for a better understanding of market conditions as it can be used to determine and uncover a customer’s purchase patterns, budget, as well as growth predictions and profit.
Google reports that a data scientist is the most in-demand position nowadays and the most attractive job of the 21st century.
In the face of the competitiveness of growing business and industries, taking strategic decisions is a necessity in order to prosper. That is why it is highly recommended to have data centres in each organisation.
Take a cue from Jeff Bezos
Who does not know Jeff Bezos? When he started Amazon, his intention was to gather data on shoppers by selling books close to cost to increase sales. Collecting millions of customers’ data helped the company to learn how to sell everything else online.
Amazon literally changed the world of e-commerce. A customer-acquisition strategy was achieved through data collection.
Predictive intelligence, for instance, helps businesses by tracking people’s locations, interpreting the data collected and analysing patterns on how consumers move around cities to build facilities such as malls, supermarkets and recreation centres.
Have you ever noticed that there are companies that offer “free internet” for some minutes? Curiously they want you to enter your email address, mobile number, gender among other things before they can give you access. They are actually collecting and gathering data.
However unlike oil, which is a scarce commodity, data is a fast-growing industry and is infinite. It can be reused and will never lose its value. It is hard to calculate the exact amount of data used. Nonetheless, it is estimated that 2,5 quintillion bytes of data are produced every day and that, by the year 2025, 463 exabytes of data will be generated daily.
Digitisation is real. Go digital or go home, is one of the most used statements in the conversations around digitisation. There is persistent growth in the data domain due to swift development of digitalisation.
Even the statistics are astounding. Mark Zuckerberg reports that, WhatsApp is now delivering over 100 billion messages every day with more than an estimated 2 billion users globally.
Google processes over 3,5 billion searches per day. There are 306,4 billion emails sent and 500 million tweets daily. There is no going back. You have to thoroughly position yourself for this world, where data is now literally the new oil.
Invest in Data Infrastructure
Data infrastructure should become a profit centre. For many businesses, their data infrastructure is still a cost centre. However, this should turn around, and they should become a profit centre by using the data to improve everything, day by day.
Companies must begin treating data as an enterprise wide corporate asset. This enables sharing of data about products and customers, which provides opportunities to up sell, cross sell, improve customer service and retention rates.
By using internal data in combination with external data, there is a huge opportunity for every company in the world to create new products and services across lines of business.
Good Data is better than Opinions
When your business is growing, more and more people have opinions about which steps need to be taken. “Good data beats opinion” philosophy can help your business in making decisions.
Almost everything can be tested, measured and improved. If you can measure it, you can improve it. Inspire people to come up with new ideas and pick up new opportunities and just test it and see what the impact is.
Make sure you’ve real time access to the most important data in your business. Only knowing your total revenue, profit or costs is not enough. Knowing which KPI’s influence them and other business goals is much more important, because you learn how to improve your business.
Take time to evaluate your data culture as a business as Data is now the new oil. I will deal with the remaining six (6) principles in the next articles.
Join me on Star FM on Wednesdays (09:40am-10:00am) for some moments of inspiration on the Breeze with V Candy.
Arthur Marara is a corporate law attorney, keynote speaker, corporate and personal branding speaker commanding the stage with his delightful humour, raw energy, and wealth of life experiences. He is a financial wellness expert and is passionate about addressing the issues of wellness, strategy and personal and professional development. Arthur is the author of “Toys for Adults”s a thought provoking book on entrepreneurship, and “No one is Coming” a book that seeks to equip leaders to take charge. Send your feedback to [email protected] or Visit his website www.arthurmarara.com or contact him on WhatsApp: wa.me//263780055152 or call +263772467255.