Our thoughts on the future of business
Bringing strategy into the digital age
Jonathan | February 15, 2018
Strategic decisions are the highest value decisions an organization makes
- Which customers do we focus on?
- Which projects do we do?
- What products should we build?
- How do we allocate resources?
. . .yet they are the least digitally enabled.
Why? Until recently, the data availability and flexible modeling systems weren’t ready. With the explosion of advanced data analytics and ML/AI, strategy support was overlooked as the realm of consultants.
At SnapStrat, we are providing the products to help organizations digitize their most important strategic decisions. What we have found is that the technology is the easy part: building the culture and process that take advantage of the new digital capabilities is the challenge. We have discovered that organizations that make the transition successfully follow 3 common rules:
1) Stop looking in the rear-view mirror
The “business dashboard” is an increasingly common presence in the C-suite. These dashboards provide useful information at an enterprise or functional level, but they have a fundamental gap: They only look backwards.
One of our early customers had detailed ROI data around their loyalty program offers – but did not use that data to structure offers looking forward. Once they were able to use that data to predict future behavior it unlocked millions in value. Don’t get caught in the “We don’t have good enough data” trap. Effective organizations use the data they already have for predictive optimization of upcoming actions and continually improve the quality and breadth of data over time.
To leverage historical data effectively we transform that data into predictive analytics that inform forward-looking decisions. As you execute, our Machine Learning decision tracking is your new, modern, intelligent rear-view that continues to improve the predictive power quarter after quarter.
2) Don’t over simplify
Almost all business strategies are multi-dimensional with different imperatives around customers, products, geographies, capabilities etc. Often there are significant trade-offs across these imperatives – yet pulling together the disparate data sources and business logic for each decision cycle is prohibitive. Therefore, these are often ignored in the decisions that link strategy and execution.
For example, most CMOs are on a mission to be more strategic, but almost all organizations use marketing allocation technology that is nearly entirely short-term ROI focused. How can you balance brand-building, new customer acquisition, retention, product growth when you only look at short term revenue gain in allocating marketing spend?
Strategic decision-making must trade-off across multiple criteria if an organization wants to link strategy and execution. Drive your decisions from a single source-of-truth that allows for transparency, collaborative scenario modeling, and provides sufficient detail to link directly to execution.
3) Build agility into your strategy
We were talking to a leading media and entertainment company recently about how they make customer retention offers. “We have an offer management system that looks at customer lifetime value and stage in the customer journey and makes an offer based on those two factors.” So far so good. So, we asked them why they used those two factors and not thinks like reason for attriting or competitive dynamics in their market to determine the retention offer. “Well, we picked those two things 5 years ago and haven’t looked at it since”.
In this case the factors leading to what offer to make are critical in executing on strategy but this company is never reviewing this decision – what happens if its competitors are? The primary factor in this sort of market lagging behavior is the traditionally heavy-lift of redoing a large analysis. Leveraging a flexible, configurable strategic decision alignment toolkit removes that hurdle, giving your enterprise unprecedented, data-supported strategic agility.
With today’s speed of business change, your strategic decisions must be as agile as every other part of your business
Transforming your organization into a digital enterprise requires far more than just building new customer-facing capabilities. Unless those capabilities are backed by equally robust, data-driven, digital strategic decisions they will quickly become mis-aligned to an evolving business strategy.
SnapStrat’s analytics platform helps stakeholders brings the power of data science and machine learning to your most critical decisions. Contact us at email@example.com to learn more.