What restaurants can teach us about the next generation of analytics


It’s Friday night…you made a reservation weeks ago with your friends at your favorite restaurant. You’ve been waiting all week to sit down at the corner table and enjoy the bustling atmosphere of people walking through the evening, sunlit streets to their Friday night escapes – concerts, parties, etc. It’s time to take your mind off work and enjoy a delicious, chef-inspired meal and drink pairing that were seemingly hand-selected for your very tastebuds. In a moment of anticipation, you glance towards the kitchen and catch a glimpse of your server walking in your direction with a tray seemingly filled with perfectly crafted meals. It’s the moment you’ve been waiting for…time to dig in.  


As the server sets down the tray in front of your table in preparation to dish out your orders, you realize that the only thing they’ve brought to the table are the raw ingredients. Nothing chopped to the right proportions, nothing cooked to perfection, no flavors masterfully blended… just the simple, raw ingredients. Finally, to add insult to injury, your server drops off your bill, which is double or triple what you expected and seems to include the prices for all the bulk ingredient purchases… resulting in you being charged for WAY more food than your meals would have required. Unfortunately, your server explains that there is “no way to easily estimate how many ingredients your specific meal would have used, so we have to assume that the entire tray of raw ingredients would be used for your particular meal.”  


Your excitement deflates, your stomach sinks, and you know you’re in for a long night of adjusted plans that will land you frustrated and ordering ‘fries with that’ in a drive-thru line at 9pm. You cancel your order, pay for your drinks, and as you stand up to leave you think to yourself – “What a waste of high-quality ingredients, time, and money. What is this… an ingredients-only restaurant?”  


This might seem like a simple, fictitious story… but the frustration, dissatisfaction, and unbelief experienced is bigger than a single, ridiculously abstract dining experience at a fictitious restaurant. It is the single biggest key to understanding why so many organizations struggle to realize true value & ROI from pouring time, money, and resources into their ‘data-driven’ organizations.  


So, what if I told you that you DIDN’T want to be a data-driven organization? 


You’ve heard for years that your organization should be a ‘data-driven’ organization, but why do the experts say that? Let’s start by chatting about the end goal of data & analytics initiatives within any organization. Your goal is simple – to leverage data & analytics to learn more about your consumers, which creates more meaningful relationships & drives more value for your consumers, so that they, in turn, spend more of their hard-earned money on your brands/products/services. Sounds pretty straightforward…but there are three major components that impact how quickly and effectively your organization is able to drive meaningful engagement with your consumers: 


  • Data – do you have the right data for your teams to analyze and discover actionable insights that create a better experience for your consumers? 
  • Technology – do you have the right technology to enable you to scale your data (data sizes are increasing exponentially these days), capabilities, and time? 


So, what’s the issue with being ‘data-driven’? The primary flaw with ‘data-driven’ organizations is that they are typically laser-focused on the first component I mentioned above, acquiring data, which is rooted in a flawed foundational belief that having more data will lead to deeper competitive advantage for your business (most leaders have this flawed belief that having more data leads to deriving more insights).  


Many of the organizations that we work with on a day-to-day basis (from $50M to $50B+) have been working at becoming more ‘data-driven’ for years and all voice the same three ‘symptoms’ they suffer from: 

  • We ‘spend a lot’ on data (usually accompanied by a sigh) 
  • We ‘don’t use most’ of the data that we buy 
  • We still struggle to generate actionable insights at scale 


Why are these three ‘symptoms’ so common? It’s actually pretty simple. The challenge with the ‘data-driven’ approach is that it is focused solely on the ingredients, rather than the chef-inspired meal that your customers came for (or the solution to the problem). These ‘data-driven’ organizations spend all of their time buying a broad set of ingredients, in bulk, to stock their restaurants, (highly expensive, massive data feeds that are ingested into their cloud data warehouses in raw and messy forms) and they spend just as much time & energy keeping those ingredients fresh for as long as they can (implementing data quality, transformation (ETL/ELT), and support processes focused on ensuring that those massive data feeds are clean, up-to-date, and standardized).  But are they delivering what their customers ordered? We don’t believe so. At the core of serving their customers, we believe they’re solving the wrong problem – they’ve opened a restaurant, seated customers at the table, given them a beautiful menu of meal options to choose from, and then only serve them the ingredients (although yes, albeit they are fresh).  


This results in organizations that are filled with data… but unable to drive the business forward, because in most cases, their customers are not ‘chefs’ – they didn’t come to the restaurant for the ingredients – they came for the chef-prepared meal (the insight). These organizations are filled with business users who are sitting at the table waiting for insights to be derived quickly so that they can solve tomorrow’s problem, today 


So, if not ‘data-driven,’ what should we strive to be? 


Your primary focus should be on becoming an ‘Insights-driven’ organization, driving a higher number of solutions (aka ‘Insights’) to market for your teams, using the RIGHT data, at the RIGHT time, to solve the RIGHT & RELEVANT business problem. 


So how do we become an ‘Insight-driven’ organization instead of a ‘data-driven’ organization? Here are three steps to ensure you’re focused on the chef-inspired meal, rather than just the ingredients:  

  • Focus on the near-term business opportunity first (the daily specials on the menu). Begin the conversation with a statement like, “If I get Product A in 1,000 more stores during our annual review next month, I believe it will be worth $100,000 to our business in the next 12 months.” This empowers your team with a goal (1,000 more stores), an ROI target ($100,000), and a timeframe (insight needs to be delivered next month, and ROI payout is in the next 12 months).  
  • Based upon the criteria above, find the EXACT ingredients in their EXACT quantities needed – no more, no less. Evaluate the RIGHT data sources needed to support your opportunity – you might need sales data, demographic data, affinity data, etc. Use your ROI target to determine how much you can invest in the strategic data sources to solve this problem and remember that these do not need to be large, ongoing extracts if the business problem is not a large, ongoing problem. 
  • If a solution (or an accelerator) exists… buy it. The best restaurants start with inspiration from others, and you should too. Leverage solutions built by industry experts and deployed in a turnkey manner – your goal is to generate more insights in less time, not to have the freshest ingredients.  


If digital transformation has taught us anything over the last decade, it’s that competitive advantage comes from speed. The ingredients (and their freshness) matter, but they don’t mean much to us if we don’t use them to serve up ‘Insights’ in the same turnkey manner that five-star restaurants serve up chef-inspired, social media-worthy meals. Five-star ‘Insights-driven’ organizations are leveraging the best ingredients to rapidly serve up high numbers of unique and differentiated ‘Insights’ at scale to their customers, focusing not on acquiring data, but rather on solving problems at scale.  

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Erik Mitchell
To put it simply, I love business strategy and am powered by a foundation of data & analytics - I'm a data guy. I strongly believe in the power of data to change business, people, and the world. I pride myself on pushing the boundaries to come up with innovative ways to answer age-old business questions, while also discovering entirely new questions along the way. I have a strong background in CPG, Retail, & Customer Analytics and building analytics & data-driven teams & cultures from the ground up. I believe the combination of passion for data + passion for people creates a wave of opportunity, and I strive to ride that wave in all that I do both personally and professionally.

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