Applying Big Data Lessons at the 'Speed of Insight'

By
  • Christopher Surdak
Published
  • October 22 2015, 6:30am EDT

Welcome to another installment of my ongoing conversation on how to achieve real, measurable, meaningful results from big data. As our industry matures and the technical hurdles behind big data are rapidly brushed aside, we are left with issues that are largely operational, political and ultimately social.  Once your tech team builds the world’s biggest cluster of this data or lake of that data, what in the world should you do with it?  I hear this lamentation daily, and I hope to provide some guidance on how to gain real value from big data investments; while there is still time!

Action at the Speed of Insight

One of the concepts that I discuss in effective big data is Action at the Speed of Insight.  Action at the Speed of Insight means that your business processes can respond at the same speed as your customers’ expectations; indeed they must. This might sound familiar to people who worked in the 1990’s and yes, I’m talking about the dreaded business process reengineering.

We hated it then, and it seems we still avoid it like the plague now. But the reality of the present day is this:  things happen fast, really, really fast.  In a world where creepy predictive and persuasive analytics are becoming expected, if your organization cannot operate predictively and persuasively, you’ll quickly become irrelevant.

The Digital Trinity of Social Media, Mobility and Analytics means that customers can expect exactly what they want, where they want it, at the price they want, instantaneously.  Deliver anything less and they’ll simply move on. Your big data efforts are likely trying to tap into this trend and expectation, and hopefully by now your organization has figured out how to leverage concepts such as Contextification, Socialfication and Gamification to stay relevant to your customers.

But, the sad reality for many organizations is that once they gain customer insight from big data analytics they have no idea what to do with it. If you know what your customer wants or needs RIGHT NOW but cannot fulfill that need at the same speed, it means not only did you not satisfy your customer, but you also actively annoyed them. Most of us have experienced this in recent history. Some organization that you interact with seems to know an awful lot about what you want or need at that moment, but they’re unable to capitalize on that insight and actually deliver to your expectations.

Believe me, your customers also find this remarkably annoying. If your twenty year old business process requires me to fill out a form in triplicate, present two forms of identification, and provide a letter from my mommy, I'm just going to turn around and leave. And thanks to the Digital Trinity, my departure will be free of effort, cost and regret.

This is the challenge of big data: not just insight, ACTION.

Kaizen:  Deming Out of Context?

Anyone familiar with quality management, process design, Lean Six Sigma, ITIL, ITSM, ISO, or EIEIO knows of the quality guru, W. Edward Deming.  Deming founded and shaped the quality revolution in industry; first in Japan and later across the rest of the world. One of Deming’s principles (but it is only ONE of them, and potentially the least-valuable) was that of constant, incremental improvement. This process, called Kaizen by the Japanese, strives to constantly improve the outputs of any process by measuring the process and making small, data-driven improvements over time.

For decades, most companies have been dramatically-misapplying the concepts of Kaizen.  They have been following a misconstrued, malignant, lazy-persons’ version of what Deming held so dear. Somehow Deming’s vision of constant process improvement was perverted into out-sourcing, right-sizing, off-shoring, de-scoping, re-shoring, de-capitalizing, efficiency-centric delivery, which basically has been a huge excuse for delivering less for more, rather than more for less.

This has led to many organizations to maintain business processes that are heavily focused upon cutting costs, controlling expenses and unwittingly ensuring that those who are closest to customers are those least enabled to help them. Data has been used as an excuse to sacrifice customer service at the altar of controlling capital. While this has been a successful strategy for many over the last quarter century, in a world driven by the Digital Trinity it is a disaster unfolding before our eyes.

We Can All Relate

I recently experienced a situation which reiterated to me why Action at the Speed of Insight is so critical to an organization’s big data success. In addition to writing, I give a lot of public speeches; and I mean A LOT of them.  There are a few tools that are absolutely critical to my work including my smartphone, my laptop, my projector, and of course my coffee travel mug!

If for some reason any of these tools is out of commission, so am I. Without these critical items I am dead in the water in terms of productivity. So, when I do lose the use of any of them it is critical to me that they be repaired or replaced immediately.

Not so long ago, one of my devices gave up its ghost, and decided to stop working at the start of one of my business trips. I was scheduled to present the following day, then leave town for yet another, then another presentation. It was imperative that I receive a replacement before I presented the next day, and then proceeded to crisscross the country from city to city.

I called the vendor’s help desk and let them know my situation. They noted the address of the hotel in which I was staying, that I needed a replacement sent to me the next business morning, and that if I didn’t receive it by noon that day I would be on to my next destination and would be unable to receive it. The agent on the call said that he “escalated” my call to be “expedited,” and assured me that the item would be received on time the following day.

Unfortunately their “expedited” process was an exception process, and required additional levels of review and approval in order to execute. This extra oversight was in place in order to ensure that money was not wasted in inefficiency or in non-emergencies. Over-nighting a device and using all of the special handling that would ensure speed and efficiency required extra cost, and meeting this extra cost naturally required additional oversight (itself an additional, non-value-added cost, but I digress).

This is mal-formed Kaizen thinking at its finest, straight out of that ITIL framework your organization paid those consultants a bazillion dollars to buy.

Wait, We have to Expedite!

You can probably guess what happened next. By the time the extra approvals took place it was too late to meet the shipping deadline for that evening. Hence, I did not receive the item in time the next day, had to “wing it” at my presentation, then left for the next city for my next presentation, without the necessary tools to do so. 

Once the noon-time deadline had been blown, I called the help desk to let them know that my need and expectation had been missed, and that the item needed to be rerouted to my next location, as I would no longer be at my present location to receive it. The agent staggered at this, stating, “We’ll need to escalate this escalation, in order to re-route the item to your next destination.” I’m sure Deming was spinning in his grave at this point, as I just shook my head, bemused.

This tragedy continued for another nine days; NINE DAYS. I kept moving from city to city, with the device following my trail, about 10 hours behind me the whole time. Every time I let the agent know that I would be at my next location for a limited period of time the agent assured me that they would re-route the device within that time frame.  Each time their process failed to do so.

The company’s attempts at meeting my needs were so out-of-whack, that they actually put a second replacement into circulation, in an attempt to get ANY device to one of my locations ahead of me.  It didn’t work.  Both devices finally caught up with me at my home the following weekend; long after I needed them and after an enormous expense in trying to be as cheap as possible.

Be Exceptional

Clearly, my experience with this vendor was spectacular; spectacularly bad! That’s life in a big data world, driven by the Digital Trinity. Because of an intense focus upon managing capital, your business processes have been optimized to be as efficient with capital (that is, costs) as possible. Process outcomes have almost been an afterthought, and process exceptions were something to be rooted out, rather than embraced as opportunities.

We were all rewarded for this cost-driven focus for a very long time, but this game has been played out. The capital management cow has been milked dry and it’s now necessary to change focus. Customers now expect, indeed demand, that we use data to be relevant to them at EVERY moment. Customers now simply expect perfection, and when you deliver less, they simply move on.

My example above was one of a process exception. It was a situation outside of normal operations, and because this should be a minority of cases, business people rarely expend much effort on their performance during exceptions.  In fact, in my old process reengineering days we used to have the saying: Design for your normal, not for your exceptions. 

Twenty years later, it’s time to sing a new tune. Today, process exceptions are your opportunity to be exceptional; and you will be. When an exception occurs you will either be exceptionally good or exceptionally bad. Either you’ve empowered those closest to your customers with big data insights and the authority to act upon them, or you’ll escalate your customer into some sort of exception management purgatory, which will definitely lead to exceptional, and not very flattering, results.

This vendor had insight into what I needed. They committed to meeting my need, then failed to do so. THIS was their grievous error. They didn’t screw up by not delivering; they screwed up by making a commitment that their process was unable to keep.  If they had told me up front that they couldn’t get me a replacement the next day, I wouldn’t have had that expectation, and I would be writing a different article right now.  But, as soon as they accepted responsibility I was relying on their promise, and they had a duty to meet that expectation (sorry, that’s some law school leaking into my otherwise-rational frame of mind). If you have insight and choose to use it, choose wisely!

Controlling Capital in the Age of Data

My experience with that help desk is a great example of Action at the Speed of Insight going horribly, horribly wrong. This vendor knew what I needed, when I needed it, where I needed it. This insight was their BEST opportunity to delight me as a customer.  However, the processes the company had in place to ACT upon this insight could not possibly operate at the required speed.  Amazingly, the company’s expedited, exception process ultimately ended up being SLOWER and MUCH more expensive than its regular process; all in the name of management of capital and cost, mind you. 

This approach was acceptable to people for years, as long as switching costs remained high and customer expectations relatively low. However, thanks to the Digital Trinity people can now switch from one vendor to another instantly, and at zero cost. At a time where there are apps to help customers change apps (and hence vendors) automatically, immediately, and for free, companies who continue to count on customer complacency to drive retention do so at their immediate peril.

Customers also experience intense “first-mover-infatuation.” The first time they experience some cool new functionality in an app they expect that same experience from EVERY app, and will accept nothing less than that experience. We’re all Appified: we have no patience, we are dramatically overstimulated, and we have irrational expectations.  I hate to break it to you, but as a business your only choice is to just deal with it.  As such, the old strategies of “fast follower,” or, “wait and see,” have become one of assured self-destruction. 

If your existing business processes were designed to mitigate risk or minimize cost (and over the last 50 years whose HASN’T?) what's the chance that your “exceptional performance” will be good, rather than bad? Appified customers simply expect perfection; you better be perfect first time, every time.  This new expectation flies in the face of the efficiency and cheapness mindset that has driven most Kaizen efforts for decades. It’s time for a change, and there’s little time at hand.

The Imperative for Action

Action at the Speed of Insight is a great measuring stick for how your organization is putting big data to work.  Deming often said that once an existing performance metric has been followed for a while, it’s time for a new metric. Here’s a new one for your organization. If you know what your customer needs on a day to day basis, you better be able to respond and at the same speed.  f you have data on them minute by minute, that’s the time frame you have to work with. Second by second, or real time? Guess how long you have to make decisions?

Wherever and however you choose to apply big data to transform your business, this time and space element is critical. Your customer is contextified; their place in time and space defines what they value. You need to know their context, and you need to respond to it. If you apply Contextification correctly, your big data efforts will make you extremely successful. Get it wrong, and you will find that your issue of managing the cost of customer queries, in hard-copy, in triplicate, with attached notes from their mommies, will rapidly solve itself as your customers instantly migrate to paths of lesser resistance. 

Christopher Surdak is a global subject matter expert for Information Governance and eDiscovery at HP Software.

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