During the last years, we’ve seen a massive technological development. From smartphones making life much easier to IT-systems that structure and analyze the massive amounts of data and connected devices enabling control in real-time.
We still don’t know where this will take us, but all have one thing in common, they generate data. Data that probably will exterminate an entire species.
Data as a resource
We humans generate huge amounts of data on a daily basis, and it’s only going to increase due to a growing number of connected devices. The large amount of data generates great challenges, and also enormous possibilities.
Data have been a useful resource for companies for a long time, it’s used for statistics, gaining control and to give indications of whether a decision was or is going to be correct out from history. Today data can be the foundation for businesses, this transformation has lead to data becoming one of the most valuable resources of our time, almost like oil.
”If data is structured and used in the right way, the possibilities are endless.”
We’ve seen companies such as Netflix, creating House of Cards already knowing it were going to be a success before it was premiered. And Coca-Cola using data to understand their customers better. We have also seen banks using data for risk assessment and large companies pushing innovation and development by the help of data to optimize internal processes.
All said, many important decisions are still taken on intuition rather than facts. The HiPPO-effect is an acronym for ‘Highest Paid Persons Opinion’ and was announced by Avinash Kaushik. The HiPPO-effect could potentially be dangerous since that kind of bias could put experts in a position where they base decisions on gut-feeling, even if data would have been a better decider.
If good data is available, why is HiPPO still making the decisions?
Many experts say that some organizations aren’t adaptable enough and therefore struggle with knowing which data are important and how it could be made useful.
”Organizations today have every opportunity to become more data driven, however, the challenge is no longer the technology.”
Most systems and connected units can be integrated to get data to flow throughout the value chain by a large selection of platform solutions.
”The greatest challenge is rather about culture, processes and mindset.”
Integration between processes and systems are required to make sure that data is not only collected but also put to use. Companies that create systems with supporting processes that ensure data-flow in the value chain, thus creating great basis for decision making throughout the whole workflow, will gain substantial advantages.
It is probably just a matter of time before data exterminates all HiPPO’s, or at least the companies where they are to be found.
Questions about data driven
descision making?
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Agnes Lindell
Business Analyst and Project Manager
Expert in data driven innovation, design thinking and agile methods.
Working at Elvenite since January 2020.