Business Strategy and the Importance of Data-Driven Decision Making
Running head: BUSINESS STRATEGY
Business Strategy and the Importance of Data-Driven Decision Making
Business Strategy and the Importance of Data-Driven Decision Making Good decision making is arguably the most important skill a successful manager can possess, but the ability to make intelligent decisions on an on-going basis requires not only intuition and experience, but also the right data. In fact, Garrison, Noreen, and Brewer (2012) identify intelligent, data-driven decision making as a business leader’s most basic managerial skill. That basic skill plays a critical role in helping a manager formulate and execute a successful business strategy. Manager’s need access to relevant historical data and projections to make intelligent, fact based decisions. The use of business intelligence and analytics has become the cornerstone of strategy formulation and execution across corporations around the globe. Access to relevant data is a necessity in not only formulating a business strategy, but in monitoring the execution of that strategy. The use of data for effective decision making is not a new concept, but since the introduction of the balanced scorecard by Robert Kaplan and David Norton in 1996, the use of data to support decision making has taken off. In addition, the adoption of enabling technologies has accelerated the use of data-driven decision making. Whether it’s an operations manager monitoring key operational indicators or a sales manager forecasting sales revenue, appropriate data and the technologies which enable its most effective use, are key necessities in making intelligent and timely decisions. Formulating and executing a business strategy is a basic requirement for just about any business, but making good decisions is the difference between a successful business and one that goes bankrupt. The key to making those intelligent decisions that aid in the formulation and execution of a successful
Business Strategy and the Importance of Data-Driven Decision Making
Business Strategy and the Importance of Data-Driven Decision Making Good decision making is arguably the most important skill a successful manager can possess, but the ability to make intelligent decisions on an on-going basis requires not only intuition and experience, but also the right data. In fact, Garrison, Noreen, and Brewer (2012) identify intelligent, data-driven decision making as a business leader’s most basic managerial skill. That basic skill plays a critical role in helping a manager formulate and execute a successful business strategy. Manager’s need access to relevant historical data and projections to make intelligent, fact based decisions. The use of business intelligence and analytics has become the cornerstone of strategy formulation and execution across corporations around the globe. Access to relevant data is a necessity in not only formulating a business strategy, but in monitoring the execution of that strategy. The use of data for effective decision making is not a new concept, but since the introduction of the balanced scorecard by Robert Kaplan and David Norton in 1996, the use of data to support decision making has taken off. In addition, the adoption of enabling technologies has accelerated the use of data-driven decision making. Whether it’s an operations manager monitoring key operational indicators or a sales manager forecasting sales revenue, appropriate data and the technologies which enable its most effective use, are key necessities in making intelligent and timely decisions. Formulating and executing a business strategy is a basic requirement for just about any business, but making good decisions is the difference between a successful business and one that goes bankrupt. The key to making those intelligent decisions that aid in the formulation and execution of a successful
References: Garrison, R. H., Noreen, E. W., & Brewer, P. C. (2012). Managerial Accounting (14th ed.). Boston, MA: McGraw-Hill Learning Solutions. Henschen, D. (2012). Advanced analytics. InformationWeek, (1351), 7-15. Retrieved from http://search.proquest.com/docview/1220681098?accountid=7083 IBM ILOG Solutions for Insurance. (2009, July). IBM Software Group Solution Brief. Retrieved February 18, 2013, from Action. Boston, MA: Harvard Business School, 1996. Print. Kaplan, R Laursen, G. H., & Thorlund, J. (2010). Business Analytics for Managers: Taking Business Intelligence Beyond Reporting Paladino, B., & Williams, N. (2008). Moving strategy forward: Merging the balanced scorecard and business intelligence