Identifying the strategies to realise your opportunity for growth
Data can be a powerful strategic tool but it isn’t magic - it requires a strategy based on your business ambitions to determine what you need to deliver value for the business.
Having worked with many SME’s over the years, we have developed ORION, a 5 step model to help you develop your data strategy.
Following the ORION 5 steps can help you build a plan and organise what needs to be done to support your business ambitions, as well as identifying the additional support and skills that may be required.
In Step 1: Opportunity we talked about understanding the business needs and ambition, the importance of creating a common agenda for your data strategy and the role of a cross-functional team.
We would recommend that this step is completed before working through the rest of the model to ensure that you have the right focus as a business.
The aim of the second step, Realise, is to use data to plan what strategies you are going to put in place to deliver against the ambition and to establish the key questions that you need to be answered to support the plans.
In this blog, we will take you through a hypothetical example of Company A to show how using data and metrics can help to establish what are the most relevant strategies to support your business ambition.
Company A's business ambition is to grow, but they don’t know by how much?
Or what growth means to their business performance and KPI's - whether that’s a growth in revenue, products sold and customers transacting.
And they aren’t sure what the best strategies are to achieving that growth, should they be developing an acquisition strategy, distribution or a product expansion strategy?
Or a combination of many?
To support Company A’s decisions where to focus - it is helpful to build scenarios to establish the size of the task and to establish which strategy has the potential to deliver the biggest impact.
Start by asking key business questions to provide the building blocks for the scenarios. The more sophisticated the scenarios, the more questions and insight you will require to answer them.
So, for Company A, let’s identify some of the key questions that they will need to answer to build the strategy.
For instance:
How much revenue do they want to grow by? (in real terms as well as percentages)
How many products need to be sold to achieve this?
How many new customers do you need to be transacting with you?
Populating a simple table like the one below with key metrics to support your scenarios:
This macro view helps position the size of the growth ambition and how it equates to the tasks that are needed to be done.
Company A believes that setting 5% to generate £5M growth figure is achievable target based on the number of extra products that they need to sale and will become the overall business performance KPI.
Next, to support that growth, one scenario could be to acquire more customers.
They already have a presence across different markets, but as each market performs differently, it might be useful to look into which market has the biggest opportunity, so additional questions Company A may ask are :
How are the markets performing at the moment?
How big is the market share?
What current competition exists?
What is the average revenue per customer for each country?
This will require looking at additional metrics such as those illustrated below:
To get more insight Company A can then build scenarios against these metrics to quantify what the potential increase could be.
For instance:
They may then want to look where the additional customers could come from in order to reach the £5M growth target and get a view as to how hard it would be to achieve that e.g. what is the increase in the size of audience required to hit the target in each market.
Based on this scenario Company A would be able to start prioritising which markets to focus on and have a better understanding of the task that needs to be done.
It is likely that you will design various scenarios for each strategy to confidently identify where the best gains are to support the overarching ambitions. Once these have been agreed, it will be possible to ladder up the strategies and tasks to the overall business performance KPI.
You are also likely to have more business questions to support the strategy further. Try to structure these questions so they have a business application, to ensure you have a clear view of how you are going to use them. This becomes the foundation for Step 3: Insight and will help the insight team deliver the most relevant insight.
Once you have agreed where the focus should be, it’s good practice to document this as an objective.
When working with our clients, we create a ‘statement of intent’ for each strategy which is a useful technique to outlining what you want to achieve, how are you going to achieve this and what the measures of success are. This will become the basis for establishing your business performance KPI framework.
This is shown in the example below:
Congratulations, you can now complete the second step of building your data strategy, you can now:
Quantify your business ambition
Identify the key business questions around the strategies to deliver the ambition
Create scenarios to determine where to focus effort
Create a ‘statement of intent’ for each strategy
This step will really help you plan how you are going to deliver against the business ambition and clearly identifies what insight you will need to support the plan.
The planning approach will build over time as the insight becomes more accessible and the questions become more complex but these templates are a good place to get started.
We Are MoJo is dedicated to developing data strategies for SME’s to drive business growth. We can facilitate this approach by providing regular access to data strategy leadership.
Get in touch to find out more, tash@wearemojo.co.uk