True genius resides in the capacity for evaluation of uncertain, hazardous, and conflicting information – Winston Churchill
The Problem of Strategic Knowledge
The strategic decision making process is the fundamental basis of strategic planning and business planning.
The result of the strategic decision making process is revealed in the strategic decisions that shape organizational strategy.
Thus, if strategic decisions are to be considered as the output of this process, then strategic intelligence or knowledge can be considered as the input that facilitates the strategic decision making process.
The use of strategic intelligence or knowledge in strategic decision making is hardly ever given the importance it deserves. There are two primary reasons for this neglect-
- Most organizations have inadequate strategic knowledge systems.
- Internal processes and personnel are singularly focused on end-results i.e. strategic decisions and not on the quality of strategic knowledge that is used to formulate these decisions.
Evaluating Strategic Knowledge Generation
Organizations need to carry out periodic evaluations of the strategic knowledge generation process. At the bare minimum, organizations need to do an annual evaluation. Several progressive organizations do this several times in a year to keep up with the fast pace of change in business and technology trends. The evaluation process involves the end-to-end mapping of how raw data is procured and ultimately transformed to strategic knowledge and disseminated throughout the organization to facilitate strategic decision making.
By mapping the different steps in the process, organizations can gain insights on the value generated in each stage commensurate to the resources (time, cost and effort) being expended.
Benefits of the Evaluation Process
The organization realizes several benefits in optimizing the strategic knowledge generation process. Let’s list the top four benefits –
- Improved data quality – The data audit process is carried out at the beginning of the evaluation. One of the key tasks is identifying inconsistent and redundant data streams and the errors in the resulting reports. The improved data quality helps in maintaining the integrity of the strategic knowledge which is ultimately generated.
- Cost savings – Another by-product of the data audit process is the detection of data streams, analytical outputs and reports that no longer serve the needs of the business. Excluding these data sources from the analysis and/or renegotiating contracts with external data vendors results in sustained cost savings. Any opportunity in reducing fixed data costs provides cost certainty.
- Advanced technology, innovation and best practices – The effectiveness of strategic knowledge can be enhanced by the periodic upgrading of data analysis tools and techniques. These include implementation of Big Data technologies, data warehousing and data lakes, cutting edge visualizations, dashboards and predictive analytics. The application of these innovative tools and techniques results in significant savings in time and resources. The use of external vendors enables the organization to learn and implement industry wide best practices.
- Superior Access – Effective strategic decision making requires that individuals have timely access to organizational strategic knowledge. The evaluation process should be used to validate whether the right people are getting the right strategic knowledge at the right time. Any gaps or shortcomings or should be remedied to improve the access and flow of strategic knowledge throughout the organization.
Key Take-away
The evaluation of the strategic knowledge generation process should be a matter of priority. This not only results in savings in time, cost and resources but also supports the organizational business strategy. Effective strategic knowledge made available to key decision makers in a timely fashion improves the quality of strategic decisions.
Finally, the evaluation of the strategic knowledge generation process is not an end by itself, but a means to a desirable end, which is effective strategic decision making.