Rich Pilling, Service Line Leader for Data Insights & Resident Futurologist at Cloudreach, challenges you to let go of your ‘lizard brain’ and become a data-led, adaptable organization.
Yesterday, I was thinking about the long-awaited delivery of my hair clippers (adapting to lockdown life!) and I realized that it was a great example of the necessity of being an adaptive, data-led organization…
…let me explain.
*Question to customer*
How does your business function… Are you a process-led organization or a data-led one?
…”Why does that matter?”, you may ask.
As a process-led organization, each part of your business is set up to handle the one or two use-cases it routinely deals with: it is efficient, quick, and… is only good at that one or two things.
Or in other words: it’s a senseless sausage machine.
But what happens when you need to change your behavior? How do you know what or where to change when you have no vision, no senses, no metrics to understand what is happening to, or within, your own system or how to predict what will happen in the future?
The answer is not found in the swim lanes of a business planning flow chart, nor an accounting spreadsheet.
It’s like the difference between a person making a conscious decision (reasoning, based on sensed input i.e. data-led) compared to a subconscious decision (process, or habit-forming, giving you the same results again and again). The latter works great when the situation doesn’t change, the former allows you to react to any situation, and importantly remember what works well…
When did you last see our world unchanging?
The 1950’s? Even then there were changes, they were just slow and imperceptible compared to now. Ever since then, changes have become more frequent and more disruptive.
These changes are usually led by technology innovations and sometimes led by world events – as is apparent right now. This means that your static (or biennially changing), process-led organization is increasingly set up to fail.
It struggles to keep pace with these changes as it has no ability to sense, respond, and hence adapt – and it will only get worse.
Do you sometimes feel out of control of the events at work? Or that your company is unable to react correctly to the changing world? Now you know why, Neo.
Readers of my previous posts will recall that we use the Cynefin framework at Cloudreach, applying ‘sense and respond’ leadership when it comes to making decisions as opposed to ‘command and control’.
It is useful in this context also. Every decision-making domain within Cynefin shows how important ‘sense’ really is, especially when in the more difficult to deal with domains of Complexity, Complication, Chaos, and Disorder. When you’re not making data-led decisions, you can only deal with obvious situations, as you have no functional ‘sense’ ability.
It’s like only being able to use your ‘lizard brain’ for business decisions (as Seth Godin shows in his excellent Linchpin: Are You Indispensable? book):
“The lizard brain is the reason you’re afraid, the reason you don’t do all the art you can, the reason you don’t ship when you can. The lizard brain is the source of the resistance.” ~ Seth Godin
The lizard part is all about instincts and habits. The more developed, reasoning parts of our brains are about creating new strategies and adapting. It’s the reason why we are able to innovate… and yes, you guessed it, that innovation creates the change and challenges I mentioned above, which can’t be solved with static ‘lizard thinking’. To paraphrase Einstein… “We can’t solve problems by using the same kind of thinking we used when we created them”.
Survival of the fittest
In business, like in nature, we must evolve, or perish.
Only where innovation is happening, will companies build the muscle memory and agility for it
In highly competitive industries like consumer tech, where businesses are driven to push boundaries and deliver brand new experiences for customers you need to embrace a culture of constant innovation and change (which begets more innovation and change).
Compare this to traditional industries – like hospitality and banking – where businesses are highly regulated and cultures are built on stability. Innovation is not a priority, which is why large gaps emerge within markets when smaller, disruptive tech-led challengers enter these industries (Monzo, AirBnB, Deliveroo etc.) and offer new, convenient, mobile-first experiences for their customers.
Once the gap is too large, the traditional players can’t adapt to the world which has changed around them. Is this how you want your company to be perceived?
To illustrate this, let’s look at a long-running and traditional business. The UK Post Office is a clear example of a process-led organization.
It is excellent at routine mail deliveries but struggles to adapt when they want to do something different like prioritize and track a package to give precise ETAs. This is because every piece of mail follows the same process in their system. This is due to their business processes being built during their long history in a pre-data time, which they are retrofitting with data rather than being data-led.
The problem becomes apparent in that it’s difficult to personalize the experience for their customers.
Compare this to a relative newcomer such as DPD which provides real-time location updates, accurate estimates of the precise delivery time window, the ability to change delivery options, even when the package is out on the delivery van.
The Post Office website for my hair clippers says “we might deliver it on Wednesday”. If this were DPD it would say “it will be there between 4.45 pm and 5.45 pm on Wednesday” and give you real-time notifications if this time changes. It’s a wholly different customer experience.
Adapt with insight
This is the oft-repeated story of legacy vs newcomer.
The legacy business cannot effectively or rapidly adapt to changing customer needs, due to its business processes (and people) being set-in-stone for so long. Therefore gaps open up in the marketplace allowing disruptive entrants to enter who can sense the change. This is one of the aspects of Porter’s 5 Forces in action.
Being a data-led business gives you precision. It allows you to make and optimize new pathways through the ‘body’ of your organization allowing you to adapt to the changing problems with knowledge and insight, rather than being left in the dark.
Are you stuck in an old Lizard organization, or are you ready to adapt? At Cloudreach we help our clients adapt to the ever-changing world around them, and the world ahead of them… from advisory, strategy, implementation, and ongoing management, we work with you to enable your change.
But for now, I’m still waiting for my hair clippers to arrive, with no ability to see when… as a customer, it’s very frustrating.
Rich leads our Data Insights practice at Cloudreach. For more information on how Cloudreach can help you prepare your business to harness the power of its data and become more data-led, click here.