7 strategies for creating a data-driven culture
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Posted by: Lucid Content Team
Data drives every facet of modern life. At any given moment, the Internet buzzes with activity from the diverse 4.39-billion populace it now reaches across the globe.
A report by cloud software giant Domo suggests that every minute of the day, America’s appetite for data is expressed by its 4,497,420 Google searches completed, 18,100,000 texts and 188,000,000 emails sent, and 4,500,000 videos watched. In total, this means that America’s per-minute consumption of Internet data is a staggering 4,416,720 GB.
For a data-driven company, each of these clicks, shares, and likes represents a wealth of information to be tapped for making better decisions and addressing customer needs. However, if you’re really going to take advantage of all of this data, you must have a work culture that will act upon it.
What is a data-driven culture?
A data-driven culture can be described as a work environment where data is leveraged in every situation in a collective effort to enhance business efficiency and effectiveness. At Lucid, our data-driven culture is what sets us apart. At each phase of our growth, it’s how we’ve continually innovated, recognized opportunities, and course-corrected along the way. As Jarom Chung, director of product, explained, “Data is part of our vernacular.”
So, what are the hallmarks of a data-driven culture and how can you build and maintain this type of culture throughout your business from your entry-level workers to your C-suite executives?
Let’s get started with these seven steps.
1. Get executive buy-in from the start
Ushering in a data-driven culture requires a data-driven management presence. When leadership grasps the importance of data, it will gain momentum within the organization.
Employees will naturally look to management for ideas on how to embrace data-driven strategy. This is why it’s critical for executives to set an example for the behaviors that others should emulate if a newly established data-driven culture is expected to thrive.
The acceptance of a data-driven leadership mindset from Lucid’s executive team (and its lasting influence) is still evident to this day. Here’s one example from Jarom: “Our president and COO will push us on our data usage if it isn’t clear or if he doesn’t understand something. This raises everyone’s IQ and pushes us to work better to communicate with data and incorporate it into our decision-making.”
2. Build data into your OKRs
If you really want your company to become a data-driven organization, the creation of its OKRs (objectives and key results) or company-wide goals should be guided by, and measured against, data.
Why? The best OKRs illustrate what your company aspires to achieve in a specific and actionable way. Managers use the company’s OKRs to formulate the objectives of their departments and to align their team accordingly. Employees are then tasked with setting and sharing their own OKRs, explaining how their goals contribute to the bigger picture.
Unfortunately, many people struggle with defining their OKRs or confirming if they’ve been achieved. Building data into your OKRs helps eliminate those struggles.
Here at Lucid, we work to make our OKRs outcome-driven rather than output-driven. When your company culture is a data culture, the focus is not just on how much you’re doing. Your focus is also on the quality of the work, how it affects change, and how those outcomes impact the bigger picture.
Your data is what highlights those changes. It offers the context to build stretch goals. When data is regularly used to set OKRs, it soon becomes part of your company’s DNA.
3. Use the right metrics
Collecting data is only worthwhile if you put it to good use. One report suggests that over half the data gathered by companies is simply ignored in spite of its potential value.
With so much data at your fingertips, it’s vitally important to choose the right metrics. They should be closely tied to your OKRs or to other measures of what actually matters to your business. One data-driven organization might gauge success by its month-over-month revenue growth. Another might value subscriber growth or unique site visits as a metric.
When asked about choosing the right metrics at Lucid, Jarom explained it like this:
“In product development, we do lots of A/B tests. You could measure a million different things. We choose metrics that are close to the user experience and secondary metrics that speak to peripheral issues within the product. There are so many possible ways to measure data. It’s important that we don’t get distracted by the ones that don’t matter.”
Ultimately, be selective about your chosen metrics and don’t get overwhelmed by data.
4. Use data to tell a story
Another hallmark of a truly data-driven organization is how often its team members rely on data in their presentations to support new strategies or to suggest the need for change.
Rather than citing numbers or statistics in a dry report, those who understand data-driven strategy recognize the value in using their data to tell a story. Done correctly, storytelling can make even the most complex or difficult concepts relatable to almost any audience.
There’s always a balancing act between the story and the numbers. Here are some tips:
- Data-driven stories often start out with a question. This question should reflect a topic that’s important to your audience. For a sales presentation, you might start with “Who is our ideal customer?”
- Consider what your audience already knows. Don’t spend too much time talking about demographics to the marketing team. Instead, focus on campaign results.
- Filter your data to fit your story’s purpose. Is the information vital for persuading your audience or is it unnecessary? Does it answer the question or overwhelm?
- Ask for help when you’re crafting your story. If your company has an in-house creative team, see if you can schedule some time to meet with them. Or tell your story to an outsider and get their honest feedback.
Above all, be objective in how you tell your story. Don’t embellish the facts. Always give your audience an accurate representation of your findings and never betray their trust.
5. Lean into measuring certainty
Within a data-driven organization, managers can actively identify opportunities for team members to increase efficiencies and maximize productivity by measuring certainty.
Make a habit of always asking team members the question, “How certain are you?”
This basic question can take many forms and can adapt to any work scenario. For example, you might ask an employee, “How certain are you that you can deliver this product in 2 weeks?” If they say “80%,” follow up and ask them, “What can we do to get you closer to 95% certainty? What additional resources do you need to increase your certainty?”
By leaning into measuring certainty, you take a proactive stance in managing the current project environment and figuring out how to increase certainty and decrease uncertainty.
6. Prioritize data training
Before a company can expect its team members to rely on data and make effective use of it in the workplace, they must gain an understanding of what’s possible with the data.
Not everyone in a data-driven organization is an expert on data. At least, not at first.
Here at Lucid, our product analysts conduct trainings and information sessions during office hours. Their goal is to help every team member visualize, interpret, communicate, and work with data as it correlates with their particular discipline or role at the company.
From our experience, the ideal formula looks something like this: data training = access to resources + training capabilities + continued expectations. The continued expectation in a data-driven culture is that team members will always use data in decision making.
In some instances, Lucid also provides multi-week training courses on the topic of data. Managers nominate team members to participate. Homework and in-class projects are included in the curriculum to make the learning experience as meaningful as possible.
7. Make data part of the interview process
Data’s importance to your business should be reinforced from the very start.
During the interview process, hiring managers should find moments to present data to job candidates and ask them to interpret it. Questions might include: What do you think it means? How could you visualize this? How would you explain this data to others?
Of course, it’s important to acknowledge that not everyone will come from a data-driven culture. So, this isn’t a test. At Lucid, we’re simply looking for the capacity in prospective team members to work with data and discern a willingness to integrate it into their roles.
Now, more than ever, establishing, promoting, and maintaining a data-driven culture is key to achieving success in the marketplace. Take a few of the strategies listed above and think about how you could apply them to your own business. Incorporating data into your company’s processes and decision-making is sure to deliver a high ROI.
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