Business Implications Data Culture

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    Accenture

    TechnologyVision2012

    Business Implications SeriesData culture

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    Business Implications Data culture Technology Vision 2012 trend: Converging data architectures

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    Business Implications Data culture

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    Fostering the new data culture

    Google, Facebook, and Amazon already run on datalots of it, from

    outside their respective four walls as well as inside. They sift the datain ways that deliver rich insights and lead to faster, more assureddecision making. But how is this different from a decade or two ago,when companies began investing in business intelligence solutions?Facebooks recent public offering gives a clue: its valuation owedmuch to its storehouse of consumer data. The broader answer:were entering an age in which data drives every decision. Data has

    become a strategic asset, and a companys success will depend onhow well and how often its employees, at every level, use that asset.

    Converging data architectures

    Business implication drivers Accenture

    Technology Vision 2012 technology trends

    Industrialized data servicesContext-based services

    Accenture Technology Vision 2012

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    Fans of the AMC series Mad Men

    will get it, but the rest of us needto be reminded of a time, not solong ago, when businesses hadentire service functions to producememos, type letters, make copies,and create presentations.

    Today, basic ofce-productivity applications mean that these tasks

    are expected to be part of everybodys workplace literacy. Its an

    essential part of how people do their jobs.

    Not too far in the future, business leaders will recall an era when

    data literacy was the province of only a few specialists. For now,

    it is the trailblazers among business leaders, eager to outgrow

    and out-innovate their competitors, who are creating a new

    corporate culture; one where acquiring insights and making

    decisions using data sources and data analysis is the rule and not

    the exception. Their efforts are directed toward a host of business

    benets: pushing for deeper cost savings and greater operational

    efciencies, striving for revenue growth by identifying new market

    opportunities and accelerating new-product launches, improving

    nancial models, mitigating supply chain risks, and much more.

    But whats really new here? Havent businesses been recognizing

    and treating data as a valuable asset for decades? Yes, but

    something signicant has changed: the costs associated with

    that data.

    Ten years ago, data was expensiveexpensive to gather; expensive

    to aggregate; expensive to access, report on, analyze, process, and

    store. In addition, as more data was added to the mix, the costs

    grew exponentially. To deal with those realities, organizations

    had no choice but to build systems and cultures for treating data

    as a scarce resource. That meant that only the highest priority

    decisions have been able to rely extensively on data; essentially,

    everything else has been priced out of the data equation.

    The new newsand something that most business leaders

    have not yet realizedis that innovative tools and maturing

    technologies now allow IT to change that cost equation. Data

    volumes are exploding; today, more data is being collected

    than ever before, internally, within businesses, and externally,

    among the organizations networks and in the wider consumer

    world. Horizontal-scaling technologies now allow the storingand processing of that data in ways that do not exponentially

    raise costs. Chief information ofcers can now architect data

    platforms that enable their organizations to tap structured and

    unstructured dataeverything from blog posts and Facebook

    data to e-mail trafcand to industrialize their data services (see

    Accentures Technology Vision 2012 report) so that companies can

    quickly access and share data across the organization, at minimal

    incremental cost.

    But implementing a data platform to change that cost model is

    only half of the equation. To get tangible results, its necessary to

    start modifying the organizations objectives too. Companies mustmove from the current modelthe implicit strategy of maximizing

    the benet of a set amount of data usageto an explicit model

    where all employees are expected to maximize data usage to drive

    business benets. That represents a cultural shift that can have a

    dramatic effect on how the organization is run. In the new model,

    data becomes central to innovation and to all decision making,

    fueling growth and making the organizations operations more

    efcient at every level. Data skills spread beyond IT, becoming part

    of every business function and business activity. This new culture

    not only allows all employees to ask what data would allow me

    to do my job better? but also makes the necessary data availableto them. Like the managers who were the rst to realize what the

    proliferation of Lotus 1-2-3 and Microsoft Ofce would mean

    for ofce productivity, farsighted executives today are starting

    to realize that data is becoming a strategic asset for the future

    growth of their business. In essence, data is en route to becoming

    every organizations next core competency.

    Business Implications Data culture Accenture Technology Vision 2012

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    Silicon Valleys latest approach todecision making

    Think about this scenario: a customer service manager has

    a hunch that the company could win more repeat sales if its

    customer service reps (CSRs) were to proactively contact all

    customers who have bought more than $500 worth of products

    in the last month to see if those customers have encountered

    any issues that the company could help with. In an ideal scenario,

    the service manager makes this decision by weighing the potential

    benets against the cost of having the CSRs do this. If that cost is

    less than the incremental revenue that is driven through increased

    sales, the service manager will do it; if not, they wont.

    Why arent managers acting on hunches like this every day?The answer is often distressingly simple: in most companies,

    they lack access, expectations, and time. To begin with, groups

    dont have easy access to the necessary data, even though

    the components of the data almost certainly exist in pockets

    throughout the companythe cost per hour of the CSRs time,

    the number of customers whove spent more than $500 in the last

    12 months, the current rate of repeat purchases within 3 months,

    and so on. Also, there is no expectationfew if any metrics or

    incentivesto help make this type of experimentation a part

    of someones job. And few people are given the time to act on

    these ideas. Too often, there simply isnt a minute to explore the

    possibilities; immediate concerns override such experimentation

    to the point of complete exclusion. The consequence: managers

    make decisions on gut feel, or, more often, they dont act on

    their hunches and instead just move on to their next tasks.

    Thats whats typical today. But a new corporate model is

    emerging: young companies that arent dogged by heavyweight

    legacy IT systems and that are infusing data into many more of

    the decisions their managers make every day. Amazons chief

    technology ofcer, Werner Vogels, has stated that Amazons

    free-owing data-services model enables the company to respondvery quickly to new ideas. At companies such as Amazon, LinkedIn,

    and Facebook, data is the new lingua franca: managers are expected

    to come to meetings with proposals, but those that arent backed

    by hard data are unlikely to get a hearing.

    The advantage that these companies have is this: without

    existing IT systems to contend with, theyve implemented a data

    architecture that is focused on data sharing (see Industrialized

    Data Services in Technology Vision 2012). In essence, through

    data services, their data is not tied to this or that software

    application; for the most part, its free to roam, and can be

    moved, shared with alliance partners or suppliers, divided up,analyzed every which way, blended with other datawhatever

    it takes to unlock more of its potential value.

    With data more easily available, this new breed of companies

    has gone one step further and created a new corporate data

    cultureone that regularly requires data to back up managers

    choices. Essentially, these companies have achieved a pervasive

    form of data-driven decision making. They can be quicker and

    more condent in their decision making; they can explore more

    ideas more easily and with more conclusive results; they can cut

    costs more quickly, more easily, and more effectively; and they

    are better able to evaluate and enter new markets and deneand launch new products.

    Data culture starts to trickle outward

    Most businesses are following a different path toward data-driven decision making. For them, changing ITs data infrastructure

    is hardly a given; it is neither inexpensive nor done all at once. It is,

    however, just as important,