Dear CEOs,
Hiring a good analytics consultant is one of the most important things you can do for your company.
It’s also one of the most dangerous.
When you go in for surgery, you see a doctor that’s a specialist. Someone who has spent years of their life gathering knowledge and training so they can get the surgery done right.
It’s laughable to think someone would go in for surgery and trust someone without the proper experience with the task. It’s not something you want to mess up.
In a lot of ways, data work and analytics are very similar. You can’t ignore it if you want your company to be healthy. You also can’t afford to get it wrong, because the consequences will be highly detrimental.
How to know you need analytics consultants
The need for surgery manifests itself in a lot of different ways. Some more obvious, like if you have a broken bone, and some less obvious, perhaps slight pain that may indicate a bigger problem upon having additional tests.
The need for analytics work can similarly manifest itself in a few different ways. Here are the most important signs to look for.
No one knows where to find the data to answer your questions
Whether you are asking your senior leadership, your marketing managers, or your analysts, no one seems to know how to access the data necessary to answer your questions.
This can be frustrating as a CEO. Many CEOs just expect that business data should be readily available and easy to access and use.
This is almost never the case.
Data by nature is messy, difficult to manage, and has a tendency towards chaos. If the right processes and systems aren’t put in place early, as your company grows, data will become a giant pain point.
Even if you have employees whose job it is to manage databases, like an IT department, it often doesn’t mean the data is in any kind of documented, manageable format to use to answer business questions.
If you find yourself in this scenario, the answer is often to put a strong analytical data management process in place so that data is clean, managed, and ready for analytical purposes. IT departments often are not trained properly on how to set this up in a robust way.
Getting useful reports takes longer than you expect
CEOs often have the experience of asking for a specific report on a business function, and not getting a report for weeks or sometimes months. And then when they want that same report refreshed or updated, it’s another weeklong or more process
This is frustrating.
This is also indicative of a broken or non-existent analytics pipeline. When this is happening, there is often a large amount of repeat, manual work that is happening (often in Excel) to get the data, clean it, get it in the right format, and produce the end report.
These kinds of processes are often done on an ad-hoc basis out of necessity but don’t scale well, don’t work quickly, and frequently have problems with accuracy.
If you’re dealing with this, you can expect an analytics consultant to be able to reduce your reporting time by 10 to 100 times with an automated analytical pipeline.
Your reports don’t help you make informed decisions
Let’s say you’re getting reports from your team, but either they don’t help you make any kind of useful decision, or you have to dig through them to find the useful information you want.
In both cases, this is a failure of reporting design.
Many workers in the data world think of report design as an afterthought. After all the difficult data work is done, they throw the data into some charts and call it a day.
The reality is that this is a critical step. The report is where all the insight from the data needs to be communicated effectively to the decision-maker. If this doesn’t happen, then the entire exercise has been a failure.
Thought should be given to the workflow of the decision-maker, the level of information they need, the speed and weight of the decisions they are making, whether the data is better presented as a report, an alert, or an interactive dashboard, and the familiarity of the decision-maker with data and statistics.
A good analytics consultant will help think through all these aspects so that the decision-makers get the information they need when they need it.
The numbers just don’t seem to match up
Perhaps you are lucky enough to be getting reports and they are seemingly useful, but the numbers just don’t match up.
This may come in the form of getting conflicting reports from different departments or analytics.
Or it may come in the form of data just not passing the sniff test, with results that are out of the realm of what is possible or reasonably expected to be true.
Whatever the case, this can be an indication of any number of problems, including
- Your foundational data is not clean
- Your foundational data is not documented or well understood
- You don’t have a common vocabulary to define data and metrics
- Conflicting incentives result in different data filtering and processing approaches to lean towards achieving department incentives, not reflecting the base truth
- Your reporting process is not automated or auditable, so mistakes are made in manual processing steps
Setting up a robust analytical pipeline and reporting practices can solve all these problems, so you don’t make decisions on incorrect information.
You feel like you and your leadership are flying blind
Whether the reports aren’t inciteful or you just aren’t getting the reports you need, maybe you just have the unsettling feeling that you and your management team are flying blind.
You aren’t sure what the results will be of your most important decisions. Should you hire, and if so, how much? Is marketing returning a positive ROI, and if so, which channels? Is there anything we can do to increase our sales performance? Are we losing money because our operations aren’t running efficiently?
If you have any important business questions that you feel are not getting answered, then you should definitely talk to an analytics consultant to discover how the data you already have can help inform your decisions so you can achieve the outcome you’re looking for.
You can’t demonstrate value and ROI for your clients effectively
This indication is a little bit different than the others, but still extremely important. You may notice this because your clients actually tell you they’d like to know more about the actual results your product or service is producing for them.
More often, you may just notice this in a low retention rate, or inability to charge higher prices for your services.
Even if these warning signs haven’t appeared yet, it’s a good idea to get in front of this one from the onset.
Whether it goes out in the form of email reports, or an analytics portal that your clients can log into, they need some way to see the results of your product or service on their bottom line.
Identifying the key metrics and data to share with your clients is critical to achieving this, and then building the analytical pipeline to power it will allow your clients to see and remember the value they are getting from your services. This is important for testimonials, happy customers, and a healthy business.
Analytics consultants should be able to guide you in this process.
What to expect from a good analytics consultant
Once you’ve seen some of these warning signs, it’s time to get a trained, experienced analytics consultant on board to help solve the problem. Even better, be proactive and have them help design your analytical systems from the get-go so you never have any of these issues.
We have a lot of information about how to hire a good analytics consultant when you should hire from an agency vs hiring in-house, and what to look for in the onboarding process. You can see a summary of some of the answers to these questions in the video below, or just set up some time to talk to one of our analytics consultants to see if it’s the right fit for you.