In the maturing landscape of data and analytics, organizations are constantly looking for ways to harness the power of data for better decision making and improved operations. But data strategy isn’t just about technology; it’s also about people—their behavior within the organization as well as customer psychology. Understanding and influencing human behavior can be a gamе changеr in driving data strategy. Organizations have the opportunity to stimulate conversations about data and ensure the effective initiation of analytics projects.


Data strategy is a form of change management. Its main role is making fundamental shifts in the way organizations operate, with data, analytics, and еmеrging technologies at its core. However, many aspects of data strategy may look mysterious to those who aren’t practitioners. Optimal data strategy requires cross-functional buy-in and robust business engagement. This is where human behavior plays a pivotal role.


Cross-Functional Buy-In


One of the challenges that organizations face in implementing data strategy is obtaining buy-in from various departments and stakeholders. Human behavior, including resistance to change and fear of the unknown, can often hinder progress. To overcome this, it’s essential to communicate the value of data strategy in terms that resonate with different teams.


For example, marketing might be invested in data strategy for its potential to enhance customer targeting and increase return on investment, while the finance department might focus on cost optimization and revenue growth. Communicating and contextualizing the advantages of emerging technologies and analytics for different audiences can be instrumental in gaining their support. When data strategy leverages AI and machine learning models to ensure that features resonate with customer preferences through AI-driven insights, it can ensure buy-in from the marketing department and finance will be convinced because it will increase revenue.


Amazon is a great example of robust business engagement. When it introduced the one-click order feature, it not only made the shopping experience more convenient for customers but also significantly boosted Amazon’s profits. This is a testament to how understanding customer behavior can lead to innovations that benefit both the organization and its customers.


Behavioral Economics and Data Strategy


Behavioral economics, a field that studies the psychological factors influencing economic decisions, provides valuable insights for data strategists. It helps in understanding how individuals make choices, assess risks, and react to incentives. Integrating these insights into data strategy can help in creating data-driven incentives and decision-making processes.


Netflix is a success story in understanding human behavior. Its autoplay feature that rolls into the next episode creates a seamless viewing experience. By catering to viewers’ natural desire for convenience and instant gratification, Netflix has gained a loyal and еngaged user base. Social media platforms like Instagram, TikTok, and YouTube use AI to build on human psychology by using notifications and suggestions, keeping their users engaged. The personalized content leads to returns to the platforms.


Customer Needs and the User Experience


In any data strategy, it’s essential to align your initiatives with the needs and preferences of your customers or users. This is a critical aspect of human behavior that can't be overlooked. Can you seamlessly transition your customers to the next project or offering? Can you simplify the process of requesting and receiving data and analytics projects? Understanding what your customers truly want is key to a successful data strategy.


Today, instant gratification and making it easy for users to access and use data and analytics tools are crucial. Employ user-friendly interfaces and platforms that facilitate easy navigation and quick access to insights. The more effortless it is for users to engage with data, the more they’ll be inclined to utilize it in their decision-making processes.


Feedback and Habits


Incorporating feedback from users is another significant aspect of understanding human behavior. Employ agile methodologies to adapt and evolve your data strategy continuously. Engaging users in feedback loops ensures that your data initiatives remain relevant and aligned with their needs.


For example, think about a manufacturing company using digital twins for predictive maintenance. By involving maintenance engineers in feedback loops, the company will be able to tailor the digital twins to the organization’s need. Agile methodologies provide iterations based on feedback loops. Adjustments to the digital twin’s algorithms can be easily amended to ensure effectiveness in predicting maintenance and meet the user’s need.


Data strategy isn’t always about motivation. There will be times when motivation fades. Therefore, creating a habit of data, analytics, and emerging technologies within your organization is essential. This is where building a data-driven culture comes into play. By normalizing reliance on data and emerging technologies when making decisions, organizations create a habitual approach to utilizing them rather than actually having to consciously think about them. It becomes second nature and part of the organizational fabric.


Promote regular training and workshops to keep the workforce updated with the latest data tools and techniques. Encourage a culture of curiosity and experimentation, where employees feel comfortable using data to solve problems and make decisions. Over time, this habitual approach to data can become an integral part of the organization’s DNA.


The powеr of human behavior in data strategy can’t be overestimated. It isn’t just about technology or methodologies; it’s about understanding what drives individuals and groups within an organization. Amazon and Netflix are prime examples of how organizations have leveraged human behavior to create innovations that make processes more convenient while also significantly boosting profits.


Data strategy is a form of change management, and understanding human behavior is crucial for driving this change. Cross-functional buy-in, behavioral economics, and aligning data initiatives with customer needs are all essential aspects of this strategy. Additionally, creating a seamless user experience, listening to feedback, and building habits around data use are vital for long-term success.


While technology and data methodologies are essential components of data strategy, it’s ultimately the human behavior within an organization that can make or break its success. By recognizing the significance of human behavior and aligning data initiatives accordingly, organizations can unlock the full potential of their data strategy and drive innovation and growth. Data strategy isn’t just about data; it’s about people, their behavior, and the positive impact that can be achieved when the two are in sync.

About the Authors