There are so many articles and studies explaining the essential qualities of a good leader. However, there is one leadership quality that we believe sits above the rest, and that is decision-making. Timely, accurate and consistent decision-making sums up a modern leader. We all know that indecision can annoy suppliers, disgruntle customers and lose traction in the market, which is why most successful leaders have practical techniques to make decisions. Decision-making involves choosing among a variety of available options. Each option has its advantages and disadvantages — but leaders work through these variables using data. That is what’s called data-driven decision-making.
According to a recent Harvard Business Review article, "In companies with strong data cultures, important decisions are informed by data and analytics and executives act on analytically derived insights rather than intuition or experience. While digital-native companies have strong digital cultures, many traditional companies are struggling to make progress. That’s mostly because few undertake initiatives directly aimed at achieving the desired culture change. Clearly, culture depends in large part on the orientation of senior leaders, and especially the CEO. There is little doubt that a CEO’s own reliance on data – or lack thereof – in decision making and improving the business sends a powerful message to the rest of the organization."
To validate the above views about data and decision-making taken from the HBR article, we spoke with several leaders who champion data cultures and use Phocas data analytics software. We asked what their experience has been with sharing information broadly and the accessibility of data analytics and its effect on leadership, decision-making and business outcomes.
We have exposure into areas of the business that we never had before, including some of the smaller volume lines, because it’s much faster to consume the data in the data analytics environment.
Chris Brasher, Business Analyst Manager, Inesco
Quality data helps leaders to address both the major and minor issues
Information overload is a problem, so smart leaders demand quality rather than quantity in the data that gets to them.
At Jurox animal health, the business analyst, Dorota Bragg says Phocas gives her the ability to concentrate on analysis instead of gathering data and cross-checking and reformatting it. The time saved each week by companies who receive a consolidated feed of all data sources means they have time for sound decision-making.
Some businesses continue to spend expensive resources on bringing data together manually rather than automating the process, which often results in leaders skimming and remembering only the material that confirms beliefs.
As well as knowing exactly what’s going on inside the business, companies are also addressing parts of the business they didn’t previously have time for. Chris Brasher, business analytics manager from Insco says “We have exposure into areas of the business that we never had before, including some of the smaller volume lines, because it’s much faster to consume the data in the data analytics environment.
Over at stainless steel supplier Prochem, Shane Angel, the management accountant can identify patterns to improve and gain efficiencies.
Litex's Chief Information Officer Ken Lauder leans on Phocas data analytics software to put data at the fingertips of decision makers to help them answer critical business questions related to costs and opportunities.
Data empowers the team
Vinod Deverapalli, the commercial administration manager at ICU medical says the are many benefits of providing data analytics and reporting to more people. Everyone can quickly build dashboards and databases, reducing reporting time. All departments can drill down into the detail level to help with strategic and tactical decision-making.
At ProVet, people can make simpler, faster and data-driven decisions every day. The management team want everyone to be enthusiastic users of data and eliminate manipulating spreadsheets and pivot tables.
Nick Aversano, CEO of Trade Supply Group is a modern CEO who runs a company full of decision-makers.
"Phocas makes me feel empowered to give this information to all the people in an easy to understand format. We're able to make better, decisions quicker and put information in the hands of the people who are running our businesses day-to-day. As we're growing we need to be able to make decisions at a different level sometimes and this gives them the ability to do that," says Aversano.
"I like nothing more than when I show up to a meeting and someone who I didn't expect is there with a bunch of spreadsheets from Phocas. They have data, and they want to argue their position with data, and I will speak to that data.
"These open discussions didn't happen too much in our company before we started using Phocas data analytics. Using the software over the last 10 years has made us way more data-driven. You're eliminating that time where previously we had to show people information for the first time. Now we have a meeting, and we all know what we are talking about. Everyone is coming in with their information, that makes for a lot more productive time," says Aversano.
Be willing to change
Good decision making also means being willing to change your mind based on facts and evidence. Many Phocas customers have realized that through analysis of their data – top customers are sometimes not just the companies with the largest orders because the cost to serve is high and the analysis shows the margins on these accounts is dropping. These findings can be challenging to comprehend, and making changes can be difficult, but are necessary to create a data-driven culture and accrue the competitive benefits that result from data-driven decision-making.
To find out more about how data analytics can drive a digital transformation strategy, download our eBook: Digital transformation Strategy 2.0; 4 reasons it must include data analytics