By Josh Hemann
A good friend of mine spent his career working in the Federal Prison System as a designer and administrator of processes used to deliver health care to millions of inmates. Having been in this environment for decades he has a lot of...colorful... stories. One of the things he talks about that has stuck with me is this idea of "going to ground": when under duress, people revert to old habits and deeply instinctual patterns of behavior.
While I have not dealt with the stress that prison life would induce (not to mention the factors that led to life in prison to begin with) I still appreciate this idea. I see it in my own life as a husband and father, that the qualities I think represent my personality can be quite different during periods of stress, lack of sleep, etc., and I conveniently forget this once life settles back to an even keel.
Looking back at my experience in analytics in the retail industry, "going to ground" is a pattern I have seen multiple times, at the highest levels of leadership. Here is what this pattern looks like by way of example.
- Life is good. Same-store sales are up slightly; the new email campaigns are getting great response rates; customer and employee satisfaction are at all-time highs. Yet, more growth is desired and competition is intensifying, so time to bring in the consultants. And time to invest in some data scientists and Hadoop to really squeeze insight out of the corporate data...
- But, alas, same-store sales drop the next two quarters. The Board is getting wound more tightly. While the now not-so-new marketing campaigns are still getting great response rates, it has been hard to correlate that with impact on sales. And the team does not have any answers they would be willing to stake their careers on. What happens next? The CEO dusts off her copy of Competing on Analytics, takes a deep breath, and reflects on the importance of data and statistics in making decisions. She then maintains commitment to add three positions to the internal Analytics team as well as approve the capital expense request for a small Hadoop cluster. Right?
No. That last part does not happen. Ever.
OK, this happens once in a while, but this is a blog so I'll lean towards hyperbole. The pattern here is that when business is going badly executives (and to be fair, anyone who is held accountable for distinct, key decisions) go to ground by taking the same set of instinctual actions:
- Cut costs
- Simplify programs and process
- Simplify organizational charts (do more with fewer people and flatten the org)
Could analytics play a role in a company’s turnaround strategy? Most definitely. But I have seen this pattern play out otherwise multiple times. There is often only a patina of analytically driven decision making when business is going well. But when the business is faltering going to ground is manifested in the idea that it is only the steady hand of the captain, with her intuition and experience, that rights the ship. It is definitely not through the efforts of some geeks in the north building who are developing a hidden Markov model to predict customer attrition.
I say that tongue-in-cheek, but going to ground is reasonable in many settings. So, despite the attention there is on Big Data, I think it will take a long time for our retail business culture to evolve to a point where going to ground means digging deep into data and advanced analytics, not just cutting costs.