SANTA CLARA, Calif. -- CEOs across all industries need to develop skills in three key areas to be successful in...
the age of “big data,” according to one consultant who spoke this week at the O’Reilly Strata Conference.
For starters, CEOs need to become strategic data planners, said conference speaker Diego Saenz, the founder of consulting firm Data Driven CEO. Next, CEOs should develop analytical skills and learn to ask the right questions. Finally, Saenz said, CEOs should focus on becoming more familiar with the technology that is used to derive valuable business insights from vast data stores.
As a CEO, if you’re not managing data, you’re not managing your business.
Diego Saenz, founder, Data Driven CEO
The benefits of becoming a more data-focused CEO -- and ultimately a more data-driven organization as a whole -- come in many forms and depend largely on the individual company. However, data-driven organizations can generally expect to become more responsive to customer needs and to seize business opportunities that may previously have been hidden from view.
“Data is a new raw material and this is not hype,” Saenz said. “As a CEO, if you’re not managing data, you’re not managing your business.”
A closer look at the three key traits
CEOs that want to become strategic data planners should begin by gaining a solid understanding of where their data resides, according to Saenz. That means looking closely at all of the data sources within the company and creating a plan as to how that information is going to be processed and used.
But that might not be as easy as it sounds, according to conference attendee John Amos, a senior systems engineer with defense contractor Lockheed Martin. Amos agreed that strategic data planning is of paramount importance, but said problems can arise as companies seek to aggregate and process “stove-piped” information.
“When you start to aggregate all of that data, you run into issues of ownership and accountability and that becomes a very big challenge,” Amos said. “As a CEO, I think you have to look at how you organize your business and how you’re making those business areas accountable.”
Saenz said the goal of developing analytical skills is all about learning how to ask the right questions when presented with information. Acquiring some basic statistical analysis skills can be a big help in this area, Saenz added, but there is no “hard math” involved.
“The biggest analytical capability is in our brains,” Saenz said. “You need to understand how to look at data, what it means and how to visualize it.”
CEOs that fail to develop their analytical skills run the risk of drawing the wrong conclusions when presented with data and taking the company down an ill-fated path.
“I’ve been in board meetings with public companies where [the CEO] just looks at the PowerPoint and they don’t ask the right questions,” Saenz said. “They don’t ask the why questions.”
While CEOs do not necessarily need to become technology experts, Saenz said they should at least have a fundamental understanding of the capabilities available to them and what they mean for the organization as a whole. It also helps to look beyond the walls of the organization and get a handle on new data management products and technologies as they enter the marketplace, added Lockheed Martin’s Amos.
“The technology aspect [means knowing] what the latest tools are to use to collect data and the data sources that you are collecting from,” Amos said, “and then understanding what that data really means to you as a CEO.”
For more on the O’Reilly Strata Conference:
Find out what Forrester analyst James Kobielus said about “big data” at last year’s Strata Conference
Find out if CIOs can ascend to the CEO position
Data-driven CEO elevates the role of CIO
Another thing that CEOs should think about when trying to become more data focused is the position of their company’s CIO, according to conference attendee Ram Chandrasekar, director of the analytics center of excellence and strategy at pharmaceutical giant Bristol-Myers Squibb.
As part of an effort to become more data and technology focussed, Bristol-Myers Squibb recently made some significant changes to its chain of command. The organization’s CIO is now considered a member of the senior management team and reports directly to the CEO -- a somewhat unusual state of affairs for a company in the pharmaceutical industry.
Chandrasekar said the move was designed in part to give the CEO greater visibility into how data and technology can be exploited to improve the business. He added that the CIO’s promotion is already producing positive results.
“Right when that happened, we started to see the culture of the rest of the organization changing in how they listen to the CIO and how they partner with IT,” Chandrasekar said. “I think that for any CEO to succeed, you need the right people with both the position and the personal power to make it happen.”