What does it mean to be a data-driven leader?

Paul Slezak
Strategic Thinking

How on earth did we ever survive without having the answer to everything literally in the palm of our hand or on our wrist? 

It used to be that if we woke up tired, we’d just say, “I didn’t sleep very well”. Now our phones, watches, and FitBits can tell us specifically which sleep cycles were broken and when. Or if we felt sluggish, we’d know we hadn’t exercised enough. Did anyone actually even count steps? Today we know exactly how many steps we’ve walked and how many floors we’ve climbed at any point during the day. 

Remember when your Mum used to tell you to pack a jumper since it ‘might’ get cold or to take an umbrella just in case it rained? Today’s kids are like, “Mum, there’s a 20% chance of rain at 2pm and I’ll be in geography class then, and it’s not getting any cooler until later tonight, so I’m all good!” 

Or how often would we set off somewhere in the car and just have to grin and bear it if traffic came to a complete standstill? Not today. Before we even start the car, our phone tells us which way is fastest, and if along the way the situation changes, our Google Maps or Waze friendly voice says, “re-routing you now”. 

Data is everywhere. 

In our personal lives and our work lives, we are surrounded by data and dashboards. It’s unavoidable. 

I can recall a time before data analytics and data visualization was even really a ‘thing’, when we would sit in meetings planning for the upcoming month or quarter or setting the budget for the year ahead. If anyone questioned a particular goal or strategy, people would actually say something along the lines of, “I’m just going with my gut here”. In fact one colleague of mine would regularly say, “I can feel it in my waters”! 

Back in the day, we were often over reliant on qualitative information. “Clients are asking for …"; “The team think …"; “Everyone wants to see …".  And we may have even been too scared to ask, “how many clients exactly?”, “specifically which team members?”, or most importantly, “Who is everyone?”. 

Today there is so much information available. It’s all right there in front of us 24x7. Everything can be tracked. Data can be sliced and diced so there’s absolutely no excuse for ‘going on gut feel’ anymore. 

So, what does it mean to be a data driven leader? 

If you measured every metric or data point that every article on the web suggests you should measure to confirm whether you are leading effectively or not, you would end up spending all your time measuring instead of actually leading. 

Having said that, the research shows that data driven leaders are more confident leaders. And organisations being led by data driven leaders tend to stay ahead of their competitors. 

With all the data available for leaders today, it’s important to distinguish whether you are using data to truly drive, or to simply inform or inspire your decisions.

You may not have thought about the subtle differences so let’s distinguish each of the three approaches to data. 

  • A data-driven leader will use specific data to make a definitive decision 
  • A data-informed leader is aware of how a specific product, service, or part of the business is performing but the information isn’t necessarily impacting a specific strategy or decision per se
  • A data-inspired leader observes behaviours or trends within a business, product, or service offering and may factor such trends into longer term strategic planning but not into any immediate decisions 

You might feel that depending on the situation, you demonstrate all three mindsets. But for the purposes of this post, we’ll be focusing on the traits of data-driven leaders. 

What sort of data driven decisions are you making today? 

Are you using data to drive your budgeting decisions? Marketing spend? Customer demographic focus? Hiring strategy? Branding updates? Website messaging? Sales targets? Pricing models? Product iterations? User experience? 

As long as you have access to the data, or you have someone in the team analysing the data for you (perhaps even creating dashboards or other forms of data visualisation), you can easily use it to make key decisions right across your business.

Whilst there is certainly a strong push for using data to drive marketing focused decisions, as a leader you can use data to help you make decisions that can have a positive impact on current clients, potential customers, your product or service offering, customer engagement, and of course your team members (and potential future hires). 

To be a productive data-driven leader you will want to consider what types of decisions you need to prioritise.

What type of data you will need to help drive (not simply inform) your decisions; how you will track the data; what types of tools you might need to access the data; what assistance you might need to help make sense of the data; and above all, how current the data is that you are planning to use to drive your decisions moving forward. 

In other words, data-driven leaders need to have the tools, systems, and internal support network in place to be able to make effective decisions based on the information and statistics available. 

Another important question for any data-driven leader is whether you are comfortable being the sole flag bearer for data-driven decision making within the business or whether your goal is to create a data-driven culture, which would naturally start with you. After all, any cultural change stems from the top. 

Imagine having a workplace where all your team members are making decisions based on the data available as opposed to going on gut feel, or as is the case in many teams, ‘building the plane while flying it’. It also creates a more inclusive culture when team members don’t just see their leaders making company-wide decisions based on data, but when everyone is encouraged to make data-driven decisions.  

This certainly doesn’t mean everyone in the business suddenly needs to become an expert in data analytics, coding, or machine learning.

The idea is to instill more collaboration between your business analysts, data scientists, and the broader business. As a data-driven leader, some of your primary goals might be to: 

  • Encourage everyone in the team to embrace data 
  • Reinforce the differences between data-driven, data-informed, and data-inspired mindsets 
  • Demonstrate how data can help drive business improvements, and create a strategic competitive advantage 
  • Make data accessible to everyone and have your data experts share their wisdom 
You also won’t be able to create a data-driven culture overnight.

It will take time, so you might want to consider which parts of the business should be introduced to the idea first and then work from there. As long as your team members can see that you are an ambassador for data-driven decision making, they will then hopefully aspire to follow in your footsteps … especially when they can see the evidence that the data can make them better at their jobs and isn’t simply being used to measure (e.g) customer insights. 

Data can certainly help you improve business performance (increase sales), forge more solid client relationships, streamline internal operations, and improve recruitment processes. However, the value isn’t purely in the data itself. It’s about what you do with it and how you use it to drive your decisions as a business leader. 

Remember, Hellomonday provides coaching and support to every leader, prioritising development initiatives that result in long-term sustained learning and change, reinforcing habits through curated learning and impactful coaching, and ideally helping leaders embrace data-driven decision making.