In my last post, I talked about some of the defining traits of an organization at the lowest, first, stage of the “Analytics Maturity Curve”. The second stage of the “Analytics Maturity Curve” is what Tom Davenport refers to as the “Localized Analytics” stage.
Common Traits of This Stage
The “Localized Analytics” stage is a stage that, based on my estimates, roughly 1 in 4 financial institutions have reached. In this stage, any data analytics efforts are siloed to a small number of departments or subject areas. For banks and credit unions, your marketing department – especially a digital marketing area – or lending might be driving your organization to this second stage of “Analytics Maturity Curve”.
Questions that are asked by these pockets of analytics include:
- Why was last month’s results the way they were?
- How can we use data analytics to improve [EFFORT/INITIATIVE/PROCESS]
- What data can we use to understand this [EFFORT/INITIATIVE/PROCESS] better?
Notice that each question is not phrased as a simple backwards-looking assessment. Instead, the questions ask how data can improve or better understand some process or effort. The questions naturally become multi-dimensional this way and generally start to grow the data-driven mindset.
Unfortunately, organizations at this stage do not have complete buy-in from management and the enterprise with data analytics. These pockets of analytics show great interest and open up exciting new innovative opportunities for the organization. Stop and ask yourself this:
Is your department a pocket of analytics? Or is it a detractor from the organization’s analytics maturity? If so, why?
Technology Used at This Stage
In the second stage, the “Localized Analytics” stage of the “Analytics Maturity Curve”, a data warehouse or any enterprise analytics platform is non-existent. The most advanced of the stage two organizations may have an independent data mart in place to support local analytics. However, all technology is siloed and not shared across department lines.
How many reporting tools or applications does your organization have that only have users from a single department?
If you rely on reporting solutions for your lending area, your core, your marketing department, or any other area, you are certainly no further than stage two of the “Analytics Maturity Curve”.
Where’s the Good News?
There is plenty of good news for organizations at this stage of the “Analytics Maturity Curve”. First, you are clearly progressing up from the “Analytics Impaired” stage. Progress is being made and the right steps are being taken. While this isn’t a “full steam ahead” approach to analytics, organizations at stage two of the curve are slowly building up experience with and pockets of analytics.
The lessons each pocket of localized analytics learns can be applied to growing your organization’s analytics maturity as your progress up the curve.
Is your organization at stage two? Here are some parting comments worth remembering:
Prove the value of analytics – even if it is limited to a handful of areas.
Educate your senior management on the successes and/or failures your area has had with localized analytics. Lessons learned – from both the good and the bad – will prove beneficial.
Plant seeds by asking the right question. If someone talks about last month’s numbers, ask them WHY the numbers are what they are. Challenge your colleagues to think deeper about data.
Stay tuned next week for a discussion organizations that are at the third stage of the “Analytics Maturity Curve”!
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