From Failure to Success: How Culture Can Make or Break Your Data-Driven Ambitions
By Rossella Blatt Vital, Sr Director of Artificial Intelligence, Levi Strauss & Co.
The days of data-driven organizations being a luxury or a competitive advantage are long gone; instead, it has become a necessity to stay relevant and thrive. A data-driven organization is one that uses data to drive all its decisions and operations, from product development and marketing to customer service and finance. It is an organization that values data as a strategic asset and leverages it to create value and a competitive advantage.
Ultimately, the organization’s culture will determine whether or not it can successfully capitalize on the unprecedented technological innovation of today’s world and whether it can rapidly iterate to create a sustainable competitive advantage and thrive in the long run.
Companies across industries are investing heavily in becoming data-driven, yet most of them are failing to reap the benefits: according to a survey conducted by NewVantage Partners in 2021, 93.4% of organizations report investing in becoming more data-driven, but only 24.8% report having successfully created a data-driven organization. This begs the question: why? There is an abundance of tools and technology available to facilitate this transformation, and expertise in data, analytics, and Al is not scarce. Nor is there any shortage of ideas on how to use data and Al to create value. The missing piece is culture and ways of working. Becoming data-driven requires more than just investing in technology and talent. Being data-driven is more about cultivating a culture of agility, experimentation, collaboration, and innovation than it is about any specific technology or process. As such, it requires a cultural shift, a change in how people think, work, and make decisions. To become a data-driven organization, companies need to invest in three things:
1. Technology;
2. Internal expertise;
3. Culture and ways of working.
Each of these factors is necessary but not sufficient alone. They must work harmoniously to create a data-driven culture that empowers people to use data to make informed decisions.
Unfortunately, most organizations make the mistake of investing only in technology and/or internal talent, dismissing the cultural change that is necessary to bring about real change. They invest in digital transformations, hire top talent, and create new teams focused on AI and data. Still, without investing in culture and ways of working, the new tools go to waste, and the talent they hire ends up feeling blocked, frustrated, and eventually leaving. They forget that technology and talent are useless without a culture that values data and empowers people to use it. It’s like buying a Ferrari without any road to drive it on. A data-driven culture allows organizations to transform their investments in technology and internal expertise into value. It is the highway that will empower them to ride their Ferrari to new distances.
Changing the culture of an organization is a deep transformation that requires significant courage, commitment, and a thoughtful, intentional design of internal operational models and ways of working. To create a culture that values data and empowers people to use it, companies need to adopt important working methods that are conducive to being a data-driven organization. These include creating empowered, autonomous cross-functional teams that have all the required expertise within them, being outcome-oriented instead of output-focused, being swift to relentlessly re-affirm a competitive advantage, being genuinely curious, open, leaving no space for ego, fostering an environment of trust, and cultivating internal alignment (for example, to ensure that all analytics and AI initiatives are in service of business strategy and product priorities).
Organizations must have the courage to look inside and admit their maturity across these cultural dimensions. Interestingly, when the right culture is present, the right talent and technology often follow. But in the absence of this culture, then the wrong talent will be hired (or, even worse, appointed to leadership roles), and the wrong technical decisions will be made.
It’s important to remember that being data-driven is not a black-and-white state, but rather a continuous cultural growth that requires assessment and improvement. By evaluating key data points such as the quality of data, ability to move fast, experimentation, value driven through data products, decision-making processes, level of collaboration, and talent satisfaction, companies can assess whether they are truly data-driven.
Ultimately, the organization’s culture will determine whether or not it can successfully capitalize on the unprecedented technological innovation of today’s world and whether it can rapidly iterate to create a sustainable competitive advantage and thrive in the long run. Regardless of the resources allocated towards technology, talent acquisition, and process optimization, all endeavors are at risk of failure without the foundation of a data-driven culture. As the adage goes, “culture eats strategy for breakfast,” and this couldn’t be more true when it comes to becoming a data-driven organization.