Want to Fully Leverage Data? Change the Way You Operate
A digital revolution is occurring in nearly every industry–healthcare, manufacturing, finance, retail and the list goes on. Organizations are adopting sensors, digital records, the cloud and automation (among a plethora of other technologies) to streamline and improve operations, reporting and customer service. Underlying it all is a steady stream of data–a deluge of data, to be more precise–that has the potential to change business as we know it.
We’re on the edge of a paradigm shift in the way organizations operate–and rightfully so. New technologies are developed daily and will only contribute to even larger volumes of information. To take advantage of the value data holds, enterprises need different skill-sets, decision-making structures and a new lens for evaluating business challenges.
What the Future Holds
From artificial intelligence to robotics, in the next five to 10 years, organizations will have nearly everything needed to automate manual tasks and decision making. As sales and customer service is automated, consumers will place a higher value on human interactions while maintaining the expectation of elevated service – in other words, people will need to have information about their customers, their preferences, and past experiences at their fingertips.
Using the power of analytics, organizations will have the ability to sort through these massive amounts of data and learn from it at a breath-taking speed. When you think about how long it took for people to tabulate and analyze data in the past compared to today’s processes, the progress is astounding. Fast analytics will do to business what the microscope did for biology. It will be our magnifying glass to see what we previously could not see.
Why We Need a New Structure
While companies will have more data than ever before, they will need to rethink organizational structure in order to benefit from the competitive advantages it brings—and the new business models it can engender.
Consider this: Much of the technology needed to carry organizations into the future already exists. Using technology developed 20 years ago, for example, we can get to Mars. It’s not necessarily that we need to develop new technologies, it’s that we need to expand how we apply them, and that requires a different way of thinking.
The (Business) World Needs to be Flat
As companies adapt to technological changes, the speed of transition will drive flatter organizational models. Instead of the rigid hierarchies once required to operate efficiently, organizations must begin to operate the other way around.
Innovations such as self-service analytics, for example, require fewer approvals to enable decision-making. As such, rather than employing the traditional decision-making hierarchy, organizations should foster a culture of analytics. What does this entail? Empower everyone in the organization to make fact-based decisions. Ask front-line employees, including sales associates and those on the manufacturing floor, what data they use to make decisions. If they do not use data, take steps to correct this. Do they need access to data? Are they comfortable with data? Do not turn everyone into a data analyst; just give them the information necessary to make decisions.
Companies that flatten their organizational structure and remove barriers for decision-making will become agiler and, therefore, more competitive. Have you heard of Zappos’ model for decentralization? If not, you should take a look. While I am not saying that all organizations should go to the same extreme as Zappos, we need to dismantle certain layers in the organizational structure across the board. This shift represents a monumental change in organizational operations and supports the democratization of decision-making.
Collaboration is Essential
The traditional enterprise hierarchy isn’t the only aspect that companies must change. A flatter organizational structure means that cooperation levels must increase and that a culture of sharing and collaboration must be fostered. Organizations should select managers who have multidisciplinary backgrounds and ask them to look at unrelated businesses and borrow ideas. This will help encourage cooperation and draw in new and innovative ideas.
The challenge in developing such a culture is determining how to balance individual contributions with teamwork. Working too closely together can lead to individual burn out if each team member doesn’t contribute equally, as was confirmed by a recent Harvard Business Review study. Personally, I’ve also found that professionals need individual quiet time to finish work.
Taking those points into consideration, the ideal organizational model will enable faster decision-making with less hierarchical oversight and also engender a collaborative work environment that values strong individual contributions.
By 2035, I expect that we’ll be breaking new frontiers and creating entirely new businesses and business models—IF we can shift how we think and apply the power of analytics. Organizations will likely find they have all the data they need to solve their most challenging business problems if they put the information in the right hands with the right perspectives.
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