Solid decision making builds on speed, information and co-creation

10 May 2016 Consultancy.uk

The rapidly changing business environment is transforming the way businesses can, and need to, support decision making, according to a new report. Engaging with key stakeholders, and having access to a wide array of information, considerably improves decision outcomes. Particularly manufacturing and retail are behind the pack, in terms of enabling strong decision making environments.

The impact of new technologies, and something akin to Moore’s law in their rapid evolution, are having a marked effect on the turnover of some of the world’s largest organisations. Recent years have seen a considerable number of casualties from innovation, with past giants like Kodak and Blockbuster almost obliterated by innovative competitors. Between 2003 and 2013, for instance, 712 companies fell out of the Fortune 1000 while the average lifespan of a company within the S&P 500 has dropped from 90 years in 1935 to an average of 18 years in 2011.

Surviving in the new environment requires not merely correct judgement, but the capacity to make those judgements rapidly in line with constantly changing variables. In a new report, titled 'Rewiring the corporate brain, BearingPoint considers a number of features that the firm regards to be imperative in quality decision making.

Decision making by size

The research highlights that large organisations are more error prone that smaller ones. Organisations with personnel in excess of 100,000 are 1.2x as likely to make an error, while organisations of less than 1,000 employees are 0.9 x as likely to make an error. Further factors that increase the risk of poor decision making include decisions that are dependent on other decisions, decisions subject to compliance issues and decisions made under time pressure.  

According to the consultants, a number of factors are correlated with improved decision quality. In particular, unilateral decisions – where staff are not involved – are considerably less likely (0.5x) to result in a better decision compared to when staff are directly involved (2.2x). In decisions that affect customers, having those customers involved in the decision making process is 2.5x as likely to result in a better decision that a unilateral decision. In most instances, involving the stakeholder group that the decision affects, is correlated with better outcomes. 

A further factor disclosed by the research is that information is a key ingredient in the decision making process. Access to a wide variety of information, which is structured – but not biased – provides a strong background against which to make informed and quality decisions. The research found that bad decisions were often the resulted of, among others, slow decision making processes; lack of executive commitment; lack of workflow tool support; lack of consideration of alternatives; and complicated decisions. Particularly having information for the decision is correlated with a 1.5x better decision outcome, while digital information access is correlated with a 2.3x better decision outcome.

The decision making process in different industries differs considerably. The likelihood of having an enabling environment was considerably more likely in utilities at 1.7x, public services at 1.3x and financial services at 1.3x. The areas least conducive to enabling better decision making include manufacturing at 0.5x, life science at 0.8x and retail at 0.9x.

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How First Consulting generates more insight using fewer reports

08 March 2019 Consultancy.uk

Organisations are continuously investing in more advanced data collection and manipulation methods to enable smarter and more informed business decisions. In order to maximise their business value, companies understand the growing need for performance related insights from their data. First Consulting, a consultancy firm specialised in business change, has helped many clients in the utilities sector to deliver effective change through improved use of their data.

Most utilities firms are structured in such a way that every business unit has a team of analysts who are responsible for providing relevant data insights to their business colleagues. The business analysis teams form the link between business decision making and IT by translating business requests into meaningful actions and delivering information via reports.

Typically, the business user will receive a unique report for each information request, with each new report requiring individual, tailored support from the analyst team. This limits the productivity of the analyst teams and minimises their ability to address new data requests. The growing demand for information puts additional pressure on these teams, as a significant amount of time is required simply to gather and update the required data. This has caused reporting portfolios to expand dramatically. However, due to the analysts’ already stretched capacity, reports do not always deliver the most vital information and documentation is often incomplete.

Redesigning information delivery

At First Consulting, business consultants work in close collaboration with their clients to improve the mechanism for the delivery of information and analysis in response to business requests. The improved structure focuses on providing information per role type, rather than per request. As such, one dashboard is designed for each organisational role type, with all the relevant information presented in a single overview. This allows all individuals of a given role type to open a single dashboard and view what they need, as opposed to collating a large range of disparate links and unique reports which, previously, were all required to enable business decision making.

Moving from unique reports for each request, to reusing KPIs in a select group of dashboards

By implementing this new way of working, clients are able to reduce the reporting portfolio from over 100 reports to fewer than 20 dashboards (see figure above). In addition, the capacity for data maintenance can be reduced significantly by using modular KPIs, allowing for the re-use of data across multiple dashboards.

Changing while everyday work continues

In order to deliver effective change, it is essential that day-to-day processes remain unaffected whilst transitioning to a new reporting landscape. First Consulting achieves this by embedding business consultants within the client’s analysis team to gain feedback and determine exactly what visuals are necessary within the dashboards. This focuses effort on the outcome (such as what should be presented in the final dashboard) and allows a broad range of requirements to be considered in the business context and combined, where appropriate.

Key users and stakeholders are involved from the outset to help define what makes a high-quality dashboard. Adopting this approach helps the team to produce an optimal output that contains the key business information for the appropriate roles in an easy-to-use format.

Once it is clear what should be included in the final dashboard and how this should be presented, the team works according to the priorities set out by the product owner. This ensures that analysts work on the requirements which deliver the most value and which form the most coherent dashboards.

Main results

The advantages of implementing straightforward, no-nonsense solutions using fewer reports are particularly noticeable for the business and for the analyst teams:

  • Making adjustments is easier and maintaining and updating data costs less time
  • Management information is displayed in one location and is displayed according to defined standards, facilitating decision making
  • There is greater capacity within the business for complex analysis and project support

First Consulting combines process, technology, and implementation consulting to deliver impactful and value-adding solutions. The firm has more than 200 consultants based in the UK and the Netherlands.