You May Not Need Big Data After All

Why do companies have so little to show for their investments in big data? The biggest reason is that they aren't doing a good job using the data they already have. They don't know how to manage the information embedded in their operating systems, analyze it in ways that enhance their understanding, and then make changes in response to new evidence and insights. The few companies that have adopted evidence-based decision making ensure that all decision makers have performance data at their fingertips every day. They also follow four practices: (1) Agree on a single source of truth. Using performance data from just one source yields a more accurate view of costs and profitability. (2) Use scorecards. Perhaps the best way to teach people how to use data to create business benefits is to provide them with data about their own performance. (3) Explicitly manage business rules. Little data can have a big effect on performance when managers use the data to assess and improve the business rules that govern their operations. (4) Use coaching to improve performance. Adopting evidence-based decision making is a big cultural shift. Employees need help learning how to base their decisions on data instead of on instinct. Fortunately, companies that make the shift don't usually go back, and they improve their operations in ways that rivals can't easily replicate.

• Data management
• Operations strategy
• IT management
• Economics
• Business and government relations
• Business performance indicators
• Big data
• Innovation
• Return on investment
• Employee empowerment
• Decision making
• Financial analysis
• Predictive analytics