How to turn decision making into a competitive advantage: PwC
- 23 December, 2014 06:30
“Not only is it not good enough to make decisions based on intuition alone, but there’s no time for indecisiveness,” says Doone, as he reports on the implications of the global PwC study Gut & gigabytes: Capitalising on the art & science in decision making.
“Big decisions change strategy and the long-term course for businesses, and retailers need to make practical use of data in order to make speedy and sophisticated big decisions for competitive advantage.”
“It is promising to see that change in decision-making practices is starting to happen,” says Doone.
According to the report, 66 per cent of retail executives have changed the way they’ve approached big decision-making as a result of big data or analytics in the last two years, yet 44 per cent say that the quality, accuracy or completeness of data they have to work with isn’t high enough.
"In a world of overwhelming inputs, it's a skill to learn what not to react to. From what we're seeing in the market, New Zealand's retailers are behind global counterparts,” he states.
“Imperfection isn't always bad but retailers can gain new insights from incomplete or imperfect data, provided they are triangulated with other information. The survey findings affirm a balanced approach to using data and analytics to business-defining decisions.”
Looking ahead to the next year, 41 per cent of retailers say they are fully prepared and 54 per cent are somewhat prepared to make the most important decision they’ll need to make.
In a world of overwhelming inputs, it's a skill to learn what not to react to.
A third of respondents - 32 per cent -say that their most important decision will be based on a new opportunity they simply can’t ignore; 44 per cent expect to make at least one big decision a month and 56 per cent plan to revisit their most important decision within three to six months to adjust for new information.
Next: Prepare to make the decisions that matter most
The PwC report concludes that during times of rapid change, organisations that can calibrate themselves most accurately to their competition, and then invest accordingly, will do well.
PwC lists the four approaches for orgaisations to turn decision making into a competitive advantage:
Map decisions to shareholder value by pinpointing decisions that have the biggest impact on your future. “Understand how data analytics can give you a competitive edge.”
Link the strategic alternatives to the business impacts by simulating how mega trends, industry trends and your strategic alternatives affect your business and operating model.
Apply a value and results lens by quantifying the expected improvement in metrics associated with improving decision making.
Adopt a structured test and learn approachby specifying changes to the organisation, process, technology and culture that are needed to improve decision making. “Pilot first, learn quickly and then scale.”
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