In my last column, I discussed building enterprise information maturity (EIM) models to help assess the current state of your company's IT infrastructure, information assets and knowledge focus areas. Once you've constructed those models, you'll likely have a better understanding of the gaps that exist between where you are IT-wise and where you want to be.
It is not enough, however, just to identify the gaps to effect real change. You must understand what's causing those gaps. One way to think of the gaps between your current state and desired future state is as opportunities for improvement. Once you understand the causes and begin turning your "negative" gaps into "positive" opportunities for improvement, you should be ready to start down the path of overcoming obstacles to your desired future state.
Identify Improvement Levers
To take advantage of your opportunities for improvement, begin by identifying "improvement levers" within the company. Improvement levers are goals and/or opportunities associated with delivery of shareholder value. Next, identify data pain points, or bottlenecks, within the IT infrastructure that make it difficult to conduct business operations efficiently and that must be addressed to achieve the desired future state.
Let's start with improvement levers. One example of an improvement lever could be an objective to improve understanding of the company's customer base and market segments. The value of this improvement lever is pretty obvious. Improved customer and segment knowledge could lead to increased productivity via less time spent on manual report reconciliation; improved performance analysis, planning and forecasting; a better understanding of market position; and the ability to leverage improved information to develop better pricing strategies.
To reap the value from the improvement levers, it is critical to identify performance measurements and dimensions for each improvement lever so that information can be sorted and aggregated appropriately, i.e., by data elements such as customer, segment and product. As an example, for the "improve understanding of the customer base and market segments" lever previously mentioned, performance indicators could include customer churn rate, percentage growth by segment and percentage growth by product.
Develop Company Best Practices
It's also important to develop or identify company or industry-leading practices to trigger the improvement levers and assess current capabilities to implement those practices (as well as ways to improve those capabilities). Finally, it is imperative to define anticipated results based on existing information.
After identifying improvement levers, the next step is to identify pain points that could hinder activation of the levers. Pain points involve information assets that are critical to driving business performance and the processes that use those assets.
Analyze Pain Points
Data pain is similar to body pain; it is fairly straightforward to locate the pain, but it is often difficult to diagnose the cause. For example, a company may be experiencing a problem with reporting because it has installed a new reporting tool that cannot replicate critical sales and market segment reports the prior tool produced. This realization identifies the location of the pain - inaccessible data - but not the source of the pain: the pain point.
A closer look can help reveal a specific source for the problem. In the example just mentioned, the pain point might be that data definitions are not standardized across the company, so the new tool cannot pull data from enterprise systems required to produce the reports. Other pain points might include disparate, incompatible information systems, data cardinality and relationship issues, and lack of access to critical data held in proprietary information systems.
After identifying the pain points, it's crucial to understand how they impact business performance. For example, the pain points above may impact business performance by hampering analysis of market segment performance and customer behavior, resulting in the inability to arrive at a single version of the truth about the data and the inability to execute your identified improvement lever of "improving our understanding of our customer base and market segments."
The techniques I've shared with you here are not quick fixes for information problems - quick fixes really aren't very beneficial. However, if you conduct the analyses of improvement levers and pain points that I've outlined, you should be able to develop a better understanding of your information problems - and their sources - so that you can begin the process of addressing and correcting them.
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