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Crossing the Analytics-to-Action Divide: Part 2

  • Type: Blog

by David Groebner - Managing Director (Europe) and Scott Yamada - General Manager, Client Services

Analytics are nothing without adoption – align incentives and adjust for fit to drive change

As a global retail strategy and analytics company, our focus is helping retailers use their deep customer insights to find better ways of approaching their price, promotion planning, targeted marketing, and assortment optimization decisions. An ongoing challenge is achieving organization-wide buy in from the front-line users that will reap the most benefits from leveraging these customer insights.

In the first part of this series, we discussed how tailoring and integrating customer-centric retailing approaches require internal alignment to set up the conditions for success. In this second part, we break down how to effectively implement the analytics. Here, we’ll discuss what you can do after you’ve cracked the analytical challenges around organizational alignment and how you can embed those new insights into your business.

To recap, here are the four fundamental principles to successfully crossing the analytics-to-action divide that perplexes so many analytics teams. We’ll now address building the right framework for implementation.

  1. Bring the organization along
  2. Integrate the analytics into the business
  3. Measure & align incentives
  4. Learn and adjust – but not too much

Let’s dive into the specifics on how to effectively fine-tune different approaches to fit the needs of the end users.

Measure & align incentives

What gets measured gets managed, but only if the measures have implications. Many analytics teams will design their approach in great detail, but the audience is either resistant to the complex methodology, or they aren’t decision makers with respect to the front-line staff. Getting organizational alignment on performance measurement and the incentives involved are critical to adoption and change. To be successful, the following steps need to be put in place:

  1. GET THE METRICS RIGHT: Spend time getting the measurement of success right. Simple changes such as adding a “who logged into the tool this week” component can create awareness. Simplicity should guide all performance metrics to ensure that front-line teams can interpret their performance in a new way, even if the underlying methodology is complex. Properly defined metrics like high value vs. low value customer performance can highlight where basic sales growth can be counterproductive to the overall health of the business.Integrate the analytics into the business
  2. ENABLE ACTION: Metrics that don’t point to coachable or correctable behavior won’t enable managers to improve the performance of their teams. Framing results in key buckets that highlight the best/worst performers allow leaders to quickly key in on what’s working and what’s not, while eliminating the noise in the middle. If the metrics don’t enable action, the business will not adopt them and the measurement will be powerless to enable change. That’s why exception reporting is often an easy win.
  3. MEASUREMENT = INCENTIVES: After building usage, tying actions back to incentives is crucial to success – but it must be done carefully and correctly to avoid crafty employees finding ways to game the system without truly changing their behavior. Fundamentally, compensating team members for making the right decisions based on the new way of thinking will demonstrate organizational commitment to the approach, and ensure compliance and change. Far too often, we see major analytical projects suffering because there are few incentives to adopt.

Learn and adjust, but not too much

While it’s wise to make course corrections throughout deployment, don’t overhaul the program too much or too frequently. Taking a measured approach to changes is critical to ensure that you allow enough time to get a read on results without disrupting the solution – change takes time. If you spend time up front designing the right education, integration, and incentive program, the full value of the analytical work can be realized.

  1. SMALL TWEAKS: Noise from the front line often creates urgency for change. If you’re not viewed as responsive, resistance can grow quickly. Finding small tweaks that can eliminate some of the noise goes a long way towards demonstrating a willingness to provide support and can blunt some of the up-front criticism. If you know that this is going to happen and plan for those resources to be available, you’ll be ahead of the game.
  2. LISTEN CAREFULLY & ACKNOWLEDGE FEEDBACK: In many ways, setting up mechanisms for gathering and acknowledging feedback can help dispel front-line angst. Ensuring there is a communication plan that recognizes the input and spells out follow-up steps – even if the follow up is that nothing will be done in the short term – goes a long way towards mitigating resistance. An ongoing communication cycle validates users and creates the discipline of continuous feedback.

Ultimately, analytics will only provide value if implementation and adoption take place. Even basic analytics will drive more value if they are used – complex analytics alone are not a silver bullet. So the challenge for firms or internal groups that bring advanced analytics to life is not only to get the analytics right, but to ensure that action follows in a meaningful way. Understanding that you need to devote equal amounts of energy to the analytics themselves, and to the internal alignment and implementation efforts is the key to unlocking the power of customer analytics.

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