For someone who began their career in strategy management as a Balanced Scorecard practitioner, it might be a bit strange to say this but here goes:
In the upcoming year I’d like to see executive teams spend less effort collecting data points and more time talking about what their data is (or isn’t) telling them.
Now, don’t get me wrong – I’m not letting anyone off the measurement hook. Gathering performance data is an important activity but sometimes business leaders can take it too far. From obsessing about the “perfect” or best in industry metrics to looking at soup to nuts data sets, I see too many executive teams focusing their energy and resources on collecting results (including junk numbers) rather than investing time creating a collective understanding of the meaning behind the data.
In an age where no one has a minute to spare, it’s important that business leaders invest their business management time and effort in activities that have the greatest impact. And let’s be clear – collecting and looking at volumes of data that may or may not be crucial for informed business decision making is not the best use of executive, and organizational, energy.
When it comes to successful business management, the smart place to invest time is in connecting the dots between data points, figuring out what the meaning is, and then deciding what (if anything) to do with that insight.
In my experience, the best way to do this is through discussion and conversations.
Here are a few steps that executive teams can take to add more meaning-making conversations to their business management activities:
- Focus on a Clear Reason for Measurement
Executive teams often end up looking at huge amounts of results data simply because they haven’t decided on the questions they want the data to help them answer. Questions like “Are we doing the right things right?”, “Are we delivering an experience to our customers that they still value?”, and “Are we building the right employee capabilities for future business success?” all require specific metrics to help answer the question. Lack of clarity in your reason for measurement results in a scattershot approach to data collection and an explosion in the number of numbers you regularly have to look at.
- Focus on Data Quality Rather than Quantity
Once you know what questions you want data to help you answer it’s easier to select a focused set of quality metrics and have confidence that they’ll give you the information you’ll need. Looking at a smaller, more manageable number of data points makes it easier to understand the story your results are telling you, connect the dots, and see the bigger picture (and its implications).
- Use Conversations to Transform Data into Insight
Data without context isn’t that useful and can be misleading. While data is evidence, without context, it’s still open to interpretation. Commentary, analysis, and discussions add context to data and, when many people participate in the conversation, they are able to develop a shared understanding of the meaning behind the data. The process of conversation is critical for transforming data into shared insight that everyone in the organization can then use to determine next steps and make informed decisions with context.
While we can agree that gathering results data is important for business success, I’ve learned that it’s only the beginning. What really enables sustainable business success is the creation of the shared insight that enables informed decision-making across your organization. In a world that seems to be biased towards valuing action over thinking, conversation is often dismissed as a luxury or an impediment to progress. However, nothing could be further from the truth because discussion is often the best route to making faster, higher quality business decisions.
This year, why not make a commitment to giving conversation a higher priority in your business management activities?
Your reward will be a more engaged team that’s focusing their energy on creating new (and shared) insights that enable the decisions necessary to manage your business more pro-actively moving forward.