Most companies are realizing that the data they need in these uncertain times is either (1) not readily available, (2) not in a usable form, or (3) not the desired quality to be actionable. If the only constant is change, how can businesses use data to transform and adapt in a volatile environment?
In this Q&A, our VP of Data & Analytics, Sean Brown, shares some of the data management challenges and opportunities that organizations around the globe are experiencing—along with why he believes data should be treated as the “holy grail” in managing business continuity and maintaining a competitive edge in an age of disruption.
The coronavirus has forced businesses to rethink everything from operating models to advertising, consumer engagement and working environments. In your recent conversations with clients and with the shift in their daily operations, what’s caught your attention in how they’re responding and adjusting when it comes to leveraging data?
It’s important to point out that even before the pandemic, most companies—from small to global enterprises—were still relatively immature in adopting data and analytics into their daily operations. And now, all of them are being forced to adapt in a myriad of ways.
Many are suddenly finding themselves thriving due to the pandemic and discovering they have an urgent need to understand and adjust to an ambiguous business landscape. For example, they’re testing possible scenarios, predicting demand and financial results in a fluid marketplace, and using data to understand what the market will look like after the pandemic is over.
Likewise, we’re seeing just as many companies that have been negatively impacted. They’re struggling when it comes to cost containment and ramping down operations while at the same time not crippling their organization which will make it difficult to recover once the crisis ends. Key to this is also understanding how much demand for their products and services will return, how quickly and in what mix.
What I’ve discovered is the universal need for every company is to adjust and get answers under a compressed timeline … and it’s uncovering the cracks in their data management landscape.
How are companies analyzing their data to not only weather the current storm but also prepare to rebound quickly? How can they take advantage of the lasting changes that are certain to happen?
Some organizations are realizing that data they have at their fingertips gives them the ability to take control of their destiny and prepare for what comes next. And they’re looking at data from past events that had huge impacts. For instance, 9/11 also shut down travel, canceled vacations, formed brand new government agencies like the TSA, and caused fear and uncertainty in the general consumer-buying public. Then the “Great Recession” hit and had numerous ripple effects. No two situations are the exactly the same, but looking at the impacts of those world events and creating data simulations based on current events can be very enlightening.
But we don’t only have the past to look at! The democratization of access to data makes it easier than ever to gather insights. We now have massive treasure troves of data that are constantly monitoring world events and how situations are unfolding. We know what impact these events are having on consumers, supplier networks, etc. in near real-time. For example, The GDELT Project, or Global Database of Events, Language and Tone, can give us insights into how the coronavirus is affecting the overall psyche of the world’s population.
A striking example of how The GDELT Project has been used in business was when the Arab Spring protests began to wash over the Middle East. Several companies whose operations were based in that region used predictive analytics and data modeling and responded proactively to prepare for the pending disruption by relocating employees, supply chains, etc. in order to maintain business continuity.
Along with creating simulations, what other actionable insights are you hearing that clients are using with their data to be more resilient in the future?
Well, the reality is so many are still “heads down” right now trying to adapt processes to work under these new conditions. However, one of the world’s largest food and beverage companies recently shifted more toward running simulations. They’re now analyzing pandemic impacts on global economic indicators, locally in specific geos, as well as creating “what if” scenarios using analytics and modeling. While it’s still early days and they can’t get prescriptive yet because COVID-19 is unchartered waters, they can act quickly as new data starts to roll in.
Any other examples where you’re seeing a heightened increase in how data is influencing product development?
Yes! There’s been an exponential increase in the urgency of evaluating how customer preferences and behaviors have changed during this crisis. Companies are determining which products are most likely to sell and deliver margin with “new customers” as well as adjustments that need to be made to their product portfolio and pricing. For example, a Fortune 50 multinational that produces leading consumer goods is gleaning their analytics across product lines and evaluating specific features or ingredients in their formulas, such as disinfectant properties to determine if a new element is needed and/or what’s not selling now. A popular bath linen company is leveraging their data to highlight the anti-microbial components of their towels based on consumer expectations in a post-COVID-19 environment.
Companies who are thriving during this crisis understand that better connectivity to their data is the holy grail. It’s allowing them to do in days or weeks what normally would’ve taken months to execute.
If data is the “new holy grail,” how does this pandemic change the way leaders and their organizations need to start thinking about data?
I strongly encourage leaders to take the reins and use their data and/or data scientists to start planning for what will be the new normal. Data analytics can deliver actionable insights incredibly fast. Even if executives aren’t familiar with techniques, AI, machine learning and predictive analytics can drive insights from data streams within weeks—not years. Being able to operationalize these business insights will help leaders navigate today’s headwinds and come out the other side better equipped to take advantage of the lasting changes that are certain to happen.
How does the current crisis highlight some of the broader organizational challenges around data management and governance? Any recommendations you can give them?
Data governance is the longest four-letter word to many companies! Pre-coronavirus, most companies weren’t managing their data effectively—even big global brands. In general, most companies are not where they need to be with their data management practices, and this crisis is shining a spotlight on that. The global, all-encompassing nature of the pandemic means organizations are having to pull data from across the entire enterprise; this crisis impacts every corporate function on a global scale. In order to get through this crisis they’re going to “throw bodies at it,” create a bunch of Excel spreadsheets, Band-Aid their data together. And I’m certain that 99% of those companies are going to realize how painful this is without proper data management and governance processes in place.
It’s these difficult times that are the catalyst for reprioritizing and creating opportunities. My recommendation is don’t dismiss or lose the data you’ve been collecting. Try to document and learn from it. Analytics truly have become the new holy grail and we’re going to see more companies eager to focus on their data and be better prepared for the next macro-event.
In addition, I can’t overstate the importance of building a data-centric culture. Often, our client engagements start with their lack of understanding of why data is so critical. We help companies and their employees appreciate their whole data ecosystem and the critical role each employee plays in making sure the information they’re generating supports both the company and them–especially in building resiliency and fortifying the business for future disruption.
What should companies learn/do today to be ready for the next risk event?
The ability to deploy predictive analytics is as critical as ever. Disruptions such as this current pandemic—as bad as it is—nonetheless offer businesses an opportunity to move away from tribal knowledge, which can’t anticipate the long-term impacts of an event of this magnitude. So instead of saying, “We’ve done it this way for the past 20 years, why change?”, they can say, “I had groceries delivered to my house from Company XYZ, how do we get there?”
Diagnose underlying factors and quickly move towards predicting and prescribing actions. This sort of quick analysis will be extremely valuable to companies as they try to understand this new business climate. Identifying patterns, anticipating outcomes and responding proactively will be the basis of competition in the future.
Do you have the tools, data and skills necessary to model both the current impact and potential future business scenarios? Do you know where you should be investing/divesting now and in the future given the fluid economic conditions?
Let your data help you pivot–not panic–so you can respond swiftly to pressing operational needs as well as new customer demands for change in your products, solutions or services.
It’s all about creating the perfect fusion of business and human agility. Being able to react to a changing world as it evolves is what will define success—or failure—for many companies during and after the current crisis. How do you take key learnings you’ve had here and avoid them in the future?
Do you need help navigating the unknown (next normal) to reduce decision risk and identify the next “black swan?” Our agile business model is poised to support your organization. Learn about our COVID-19 data and analytics capabilities here.