Why Your 2015 Plan Needs To Include Data & Analytics Governance
With so many arms of your organization depending on data to make strategic decisions, columnist David Booth suggests forming a centralized team to ensure business-wide cohesion.
If you’re like most organizations, you’re either in the thick of, or just putting the finishing touches on, your 2015 planning.
Odds are good that your strategy for the coming year is going to depend on data and analytics. And while there has never before been so much data available to us, if you’re like most organizations, then odds are also good that you’re simply drowning in it.
Today, formal governance with respect to data and analytics is not only a necessity when it comes to keeping your head above water, it can also become a true competitive advantage as others struggle to deal with and leverage their data to make better decisions.
Putting in place a central data and analytics governance group within the organization can be an extremely effective way to define and enforce standards across the organization, bring various stakeholders together to determine holistic goals and a path to achieve them, and establish accountability to ensure that your data and analytics functions become a true asset that the organization actively uses to drive it forward.
A Center Of Excellence
What you call it is less important than who is a part of it and how it functions. Among our clients, we’ve seen it called the Data & Analytics Center of Excellence, a Data & Analytics Governance Board, a Digital Data Council, and even an Analytics Steering Committee. But every one of these groups share a few things in common.
An extremely important aspect of a centralized data governance group is representation from various stakeholders across the organization. Even the word “analytics” means very different things across the different groups within your organization. Finance, web, marketing, customer and business teams all generate and use data in very different ways, and often these data sets can end up living in isolated silos.
And, beyond your own organization, keep in mind that there are typically many third parties and agencies you’re working with, and often organizations will choose to bring in an external specialist or consultant to provide insight into trends and new opportunities in the data & analytics space.
While no two governance groups are the same, when putting yours together, these are many of the functions we’ve seen end up at the table:
- Web/Apps: This can include representation from website/app analysis, project management, content, customer/user experience, e-commerce, and other functional areas.
- Business Intelligence: This often includes representatives from traditional business intelligence, ad-hoc analysis, shared analytics & data services, data modeling, and operations groups.
- Customer: This may include individuals from direct marketing, customer lifecycle management, customer loyalty, CRM, and consumer insights teams.
- Digital Marketing: This typically includes key stakeholders that manage digital channels like search, display, social, programmatic, email, video, and often those involved with a data management platform (DMP).
- Sales, Pricing & Promotions: This includes sales leadership functions as well as those responsible for price & promotion decisions.
- Strategic Planning: Perspective and guidance from organizational leadership with respect to strategic planning is often included to tie together initiatives across functional areas and support broader organizational goals.
- Finance: This will be made up of one or more representatives from those producing and consuming the organization’s financial data.
- Information Technology & Systems: This includes those responsible for the hardware and software required to support the larger data stack, but also extends beyond the “pipes” and includes acute knowledge of how business processes are integrated within those systems.
- Agency/ Third Party: This often includes people from your digital, creative, & media agencies, vendor professional services resources as well as data & analytics experts to bring industry insights & an outside perspective.
For successful organizations, this is not intended to be a tactical group, but instead a strategic one. Members are typically of a more senior level with quite a bit on their plates already, and there’s often not much room for an additional large time commitment.
As such, we’ve seen organizations bring the larger group together for standing monthly or quarterly meetings along with a bit more intensive work in the planning season. Smaller subcommittees tasked with specific objectives are common and often report back to the larger group with summaries and recommendations, and standing functions such as a change control board can include a rotating membership.
In practice, much of the work done by these subcommittees is simply the work that would need to be done anyway, but the benefit of the governance group’s oversight is that these tasks are now done in the context and with the perspective of the much larger organization.
We’ve seen many situations where one part of an organization makes a significant investment in a platform or technolgy at the same time a different part of the organization is investing in a direct competitor of that technology with no knowledge of the other group’s initiatives.
We’ve even seen situations where the same technology is purchased multiple times across the organization, doubling up on not only license and implementation fees, but also costs around maintenance, education, deployment and more. And this doesn’t only happen with technology selection: often many roles and best practices with respect to data & analytics are defined multiple times and in multiple different ways throughout an organization.
We’ve seen successful governance groups limit their charter to a very specific scope of core functions. Much of this work revolves around integration and standardizing on the collection & usage of data throughout the organization, and the rest of the work tends to be centered around what to then do with it.
Standards & Definitions
Many large organizations have found that disparate groups have been for years going down their own paths with respect to data & analytics. While the web group is building out profiles of logged-in users, the customer focused group has been working with structured CRM and third party data.
The online e-commerce group has product and inventory data that may be completely separated from the in-store data sets. The farther these initiatives have diverged, the more costly and difficult the integration of these data sets becomes, and for this reason, setting standards early on and with representation from across the organization is extremely important.
Beginning with a simple yet comprehensive data dictionary is a good first step, and from there, translating the organization’s business objectives into the key performance indicators (KPIs) along with the metrics, dimensions, segments, and sources of each of those data points becomes an easier task. establishing reporting needs with respect to the various formats, frequencies, and delivery mechanisms needed by different stakeholders is often a task that helps groups share and learn from one another.
Last, understanding what data is needed across the organization helps to identify overlaps and gaps with respect to technology and process. Consolidating on a single data visualization and reporting tool across the organization, for example, can save both time and costs, while sharing best practices and process improvements allow the entire organization to leverage one group’s success.
Putting in place standards across an organization is one thing, but enforcing those standards can be quite another. A governance group with representation across the organization’s stakeholders can help to ensure compliance throughout its membership, and an effective way to accomplish this is through both formal processes to monitor new initiatives as well as an established change control process.
When the organization encounters new agencies, new websites, new apps, new product lines, new projects or new initiatives, it’s important that the governance group be both informed and consulted.
Having formal documentation that includes the data dictionary, the organization’s business goals and associated KPIs, list of data sources, technologies and platforms in use is essential for any new initiative to have and use from the very beginning. Maintaining this documentation in a clear and easily accessible format is key to ensuring that wheels are not re-invented and that organizational coherence is not lost.
However, good governance also expects and plans for change. A new agency may bring with it a better way to do something, and a new initiative may introduce a data source you’ve not encountered before.
Having a formal change control board that meets regularly and can review any of these potential improvements is a great way to understand how changes will impact other groups within the organization, how difficult and what costs will be incurred to make the changes, and how those changes will be documented and deployed throughout the organization.
Last but perhaps most importantly, a primary objective of a governance group is strategic planning. Understanding what’s possible, what’s realistic, and what’s relevant to the organization is key, and this can be translated into specific goals and a roadmap to achieving those goals over time. We’ve seen that many organizational governance groups create and maintain six, 12, and 18-month plans that define and steer the organization towards specific objectives.
In creating these plans, it’s important first to know what’s possible, and many organizations turn to external sources to present to the governance group or provide relevant research and recommendations. With a solid understanding of the data and analytics landscape, it’s then a matter of understanding where you are and establishing the end goal of where you want to be.
For example, an organization may find that it has yet to integrate customer data with its digital marketing endeavors, and puts in place the goal of using selected customer data for the targeting of specific media buys in the next six months. At this point, understanding dependencies becomes crucial.
For instance, before you can use this customer data, you may first have to acquire it or transform it into a usable form. So there may be dependencies in things like buying third party data sets, deploying data management platforms, or integrating back end systems.
This may mean that the six month plan will include these dependencies, and the goal of using the customer data to target media moves to a 12 month horizon. And that may mean that other endeavors — maybe a customer LTV study, a new web analytics deployment, or an online to offline purchase intent modeling exercise — can sneak into that 6 month plan as well.
Next, it’s important to understand required budgets and resources. At the end of the day, access to time, money and people will be constrained and prioritized, so knowing whether you have in-house expertise or will need to hire up or engage third parties or how much you’ll need to invest in new technologies and their deployment is crucial.
Knowing how much you have to invest in data & analytics can help you put in place a realistic and achievable plan for the short, medium, and long term.
If you already have in place a governance group and structure to address data & analytics throughout your organization, then hopefully you’re already recognizing the benefits and reaping the rewards. And, if you’ve not yet put this in place, then you’ve still got some time to make sure governance is a part of your 2015 plan!