The Four Levels of Analytics Maturity

We’re in a rapidly transformative age where analytics are concerned. As , “For leading and lagging companies alike, the emergence of data analytics as an omnipresent reality of modern organizational life means that a healthy data culture is becoming increasingly important.” To that end, we’re seeing more companies starting to introduce analytics in hopes of capitalizing on some of the value at stake. There’s just one problem: I’m seeing companies implementing analytics for analytics’ sake and not actually doing anything with the resulting insights.

I’ve seen this trend even in my own career. Years ago, I worked at a company that had recently started “using analytics.” I remember sitting in an eight-hour meeting where an executive asked all of the organization heads to come in and present their performance. Those presentations inevitably involved someone walking through a 100-page deck of visualizations showing surface-level trends with no attempt to dive into the “so what” behind the data.

This got me thinking. Can we categorize how successfully a company uses analytics by its ability to show the analytics, uncover underlying trends, andtake action based on them? This four-step model is what I’ve begun using to figure out where a company is on the “analytics maturity scale.”

That meeting I talked about above is what I call “Level 1” on the analytics maturity scale. Basically, an employee looks at an analytics visualization and maybe uses it for a presentation, but they don’t do much with it in terms of action to improve the business. At this point, the visualization’s only purpose is to serve as a pretty picture that an employee can display. There’s no drill down into the data, and there’s no analysis of root causes. Many companies and employees are currently in this stage, because it’s easier to do or the information presented isn’t actionable and it isn’t clear to the employee what they should do with the information. At Level 1, they just need visualizations to paint a picture of the current state of affairs in the business. For higher maturity levels, they need to take concrete action—who they manage, how they manage, and how business in done.

In Level 2, an employee looks at an analytics visualization, but he/she only cares about the output that will help with personal metrics or performance. Maybe a salesperson has a certain quota for the month. If he or she closes this next deal, will that quota be met? They’re using analytics and taking action based on it, but they’re only using it to track their ownperformance and output. This is a step above Level 1 as they’re using the analytics to drive action, but it doesn’t look at company objectives outside of their role and how they can help meet them or create long-lasting change.

In Level 3, an employee performs analysis as part of his or her job but is focused more on individual organization performance instead of the business as a whole.