can be scary when you’re acting alone. Throughout this book, you’ll notice a common theme: pulling together all available resources to get the job done. Strategic leaders don’t work alone in a silo—they connect with their colleagues around the organization in order to gain a systemic perspective on the business and ensure that they are meeting the needs of internal and external customers. Strategic leaders also make smart, informed decisions based on robust evidence that has come from all types of data. When it comes to thinking about and using data, many people get overwhelmed. It’s easy to get lost in the sea of vendors, tools, techniques, databases, dashboards, scorecards, frameworks, and all the other options available for managing and interpreting data. But when it comes right down to it, using data is all about driving change in a focused, strategic way.
Evaluation and analytics take data and turn it into information. Information provides you with knowledge, which you can synthesize into intelligence using your experience and understanding of your organization. From there, you are equipped with what you need to make strategic decisions, which in turn drive change. Understanding the change you are trying to drive will inform all of your efforts. Decisions that require a change to something (a strategy, a system, people, a program, an investment, etc.) should be based on data. Evidence-based (i.e., data-rich) decisions result in change that improves outcomes, reduces risks, and optimizes investments.
You’ve probably heard about evidence-based medicine, which has only grown in popularity since it was introduced by Dr. David Sackett in the late 1970s. Evidence-based medicine is the “idea that decisions in medical care should be based on the latest and best knowledge of what actually works.”3 This is the same concept we apply to leadership in the business world—that leaders make decisions based on data. If you think this all sounds crazily obvious, consider this: “Studies show that only about 15% of [doctors’] decisions are evidence-based,” which means that although there is a ton of medical research in existence, doctors aren’t using it.4 The same applies in organizations: we have absurd amounts of data, but instead we make decisions based on gut feelings and what someone else is excited about. One caveat: it’s possible to go too far with data-driven decision-making, too. You always look at the big picture along with what your data is telling you. Strategic leaders use a combination of information to make smart decisions.
The subject of using data brings us to the topic that we know makes many of you without a strong mathematics background cringe. It’s okay. You aren’t alone, and you don’t need to revisit college statistics to become a strategic leader. No matter what area you work in, you have the opportunity to look at business results and determine whether you’re doing the right things to get those business results. Some disciplines have a strong, obvious connection to business performance (sales, for example). For others, it’s less obvious. A good example is the field we came out of: learning and development, or training. The learning department was traditionally considered a cost center because training the workforce was considered a cost of doing business. We knew we needed to train people so they could perform and we could stay competitive and innovate. But when times turned tough and the workforce dwindled, training seemed like a luxury. We could no longer take people away from their jobs to participate in training, and we didn’t need as many people building and delivering training. This is not a strategic approach, because it stifles the competitive and innovative nature of business. However, it has, in the past, seemed like a sensible business decision on the surface due to a lack of proof that training was impacting the desired business results. So, why keep investing in something that may or may not be working? There was no clear evidence either way.
Because we came out of a field that struggled to connect its investments to revenue, we can confidently say that you can find a link between anything you’re working on and the greater business strategy5. If a direct or indirect link truly doesn’t exist, then you need to ask why you’re doing it.
When it comes to analyzing data and showing business results, the answer is simple: if you don’t already have a plan for evaluating your investments and decisions, you need one. That plan can be simple or robust, but it must be executable and help guide your strategic decision-making. Without understanding the impact of what you’re doing, you’re adrift. In your role, you may not need to have strong quantitative capabilities yourself, but business acumen and analytical awareness are critical leadership skills. Understanding analytics enables you to use data to drive change for winning results. Other leaders will take you seriously when they see that your decisions are fact-based and designed to move the company in the right direction. Leveraging all types of data when making decisions is a key component of strategic leadership, and it also empowers your organization by providing other leaders with data they need to build a truly competitive and innovative organization.
Leveraging all types of data when making decisions is a key component of strategic leadership.
You make decisions in life every day, some big and some not so big. Making an impulse purchase of a candy bar in a gas station is a decision that takes almost no thought. The cost is low, so even if you end up regretting the purchase, you aren’t out much. Most people don’t, on the other hand, buy an expensive sports car on impulse. You shop around, planning out where you’re going to store it and how you’re going to budget for all the higher ongoing costs of ownership—maintenance, tires, premium fuel, insurance, etc. In your own life, these details are usually easy to see and think through. As you get higher in an organization and have more responsibilities, you can’t immediately see all the details yourself. This is why strategic leaders use data to monitor what’s going on and make proactive changes when things aren’t going the way they should.
A winning organization—whether it’s a large corporation, a small mom-and-pop business, a start-up, a department, a team, or some other functional grouping—operates in alignment with the business. It has a vision and mission that are closely connected to corporate strategy, and everyone on the team is aligned to that vision. People on the team are enthusiastic about supporting the vision because they understand how their work connects to the organization’s success. Who doesn’t want to be part of a winning organization? The leader has an active, strategic role at the executive table and consistently steps back from everyday operations to evaluate everything the organization is doing. The leader makes sure all relevant stakeholders are informed, understand the desired impact, have their needs met, and play their part in enabling the organization to do its job. Further, everything a winning organization is doing is in some way making a needed impact on the greater business. When impact on the business misses the mark, the leader has the data necessary to identify the miss and moves quickly to remedy the situation. A winning organization’s leaders are agile by evaluating what they’re doing based on its impact on the business, making data-driven decisions, and making proactive efforts to change when change is warranted.
A strategic win drives the company’s performance in some fashion. To get specific, you and your organization need to decide what defines a strategic win. The important thing is to make those decisions at the outset, because you won’t know you’re winning if you haven’t defined success in the first place. The Impact BlueprintTM6 presented later in this book will be a great help in defining success and identifying the big-picture macro wins, as well as the micro wins that tell you if you’re making progress along the way.
Here are some examples of strategic wins.
Honeywell’s response to economic recession
The traditional school of thought about recessions is to restructure the workforce, that is, lay people off. When business softened, Honeywell’s CEO David Cote was reluctant
