It took 40 years to get to this point, but in the next four, data traffic will double. Defensive strategy is targeting your own branded keywords within your advertising campaigns. For example, a company using an offensive marketing strategy may seek to target an established industry leader’s shaky product safety record by emphasizing the safety of its own products. Thus, for example, revenue is reported, customers are defined, and products are classified in a single, unchanging, agreed-upon way within the SSOT. In short, multiple versions of the truth, derived from a common SSOT, support superior decision making. If the company think their position is strong enough, they can use the offensive strategy. To keep up top position in local and existing markets. Sales figures put into a historical or a market context suddenly have meaning—they may be climbing or falling relative to benchmarks or in response to a specific strategy. It includes the rules governing structured formats, such as databases and file systems, and the systems for connecting data with the business processes that consume it. In contrast to offensive strategies – which are aimed to attack your market competition – defensive strategies are about holding onto what you have and about using your competitive advantage to keep competitors at bay. This design is most suitable for businesses that focus on data defense. The automation alone yielded a 190% return on investment with a two-year payback time. Devoting equal attention to offense and defense is sometimes optimal, but in general it’s unwise to default to a 50/50 split rather than making considered, strategic trade-offs. The importance of investing in data governance and control—even if the payoff is abstract—is more easily understood and accepted if a company has suffered from a major regulatory challenge, a data breach, or some other serious defense-related issue. A company’s data architecture describes how data is collected, stored, transformed, distributed, and consumed. Data was once critical to only a few back-office processes, such as payroll and accounting. Offensive Strategies. 3. Data warehouses still have their uses: They store data for production applications (such as general ledger and order-management systems) that require tight security and access controls, which few data lakes can do. A lake can house the SSOT, extracting, storing, and providing access to the organization’s most granular data down to the level of individual transactions. Various defensive strategies: Position defense:. Think of it as a battleground: You have to protect your share of the market in order to keep your customers happy and your profits stable. An SSOT is the source from which multiple versions of the truth are developed. In volleyball, offensive strategies refer to an action plan to score a point. Retailers, operating in a less-regulated environment where intense competition requires robust customer analytics, might emphasize offense. A hedge fund may find itself in a tougher regulatory environment that requires rebalancing its data strategy toward defense. … And it can support the aggregation of SSOT data in nearly infinite ways in MVOTs that also reside in the lake. In September 2016, according to the technology conglomerate Cisco, global annual internet traffic surpassed one zettabyte (1021 bytes)—the equivalent, by one calculation, of 150 million years of high-definition video. 2. In the organizations we’ve studied, the concept of a single version of truth—for example, one inviolable primary source of revenue data—is fully grasped and accepted by IT and across the business. But even with the emergence of data-management functions and chief data officers (CDOs), most companies remain badly behind the curve. For example, data architecture might feed raw daily advertising and sales data into information architecture systems, such as marketing dashboards, where it is integrated and analyzed to reveal relationships between ad spend and sales by channel and region. Unlike other approaches we’ve seen, ours requires companies to make considered trade-offs between “defensive” and “offensive” uses of data and between control and flexibility in its use, as we describe below. Companies pursuing offensive strategies directly target competitors from which they want to capture market share. There is no avoiding the implications: Companies that have not yet built a data strategy and a strong data-management function need to catch up very fast or start planning for their exit. Information architecture governs the processes and rules that convert data into useful information. Determining an organization’s current and desired positions on the spectrum will force executives to make trade-offs between offensive and defensive investments. This video summarizes Michael Porter's (1985) work on offensive and defensive strategies. If rules for aggregating, integrating, and transforming data are unclear, misunderstood, or simply not followed—particularly when data transformation involves multiple poorly defined steps—it’s difficult to reliably replicate transformations and leverage information across the organization. Our framework will become even more relevant as distributed technology solutions—blockchain, for example—come into play. Defensive Amazon Strategies: Now that we talked about offense and how you can rank for your competitors' keywords, let's talk about how we protect you from your competitors doing the same thing to you and this is called playing Defense. The CDO must determine the right trade-offs while dynamically adjusting the balance by leveraging the SSOT and MVOTs architectures. It simply involves trying … A version of this article appeared in the. IP Strategies: An Offensive and Defensive Approach - April 15, 2013. In this article, the authors describe a framework for building a robust data strategy that can be applied across industries and levels of data maturity. The budget may appear larger for a centralized function than for a decentralized one simply because it’s concentrated under one CDO. Meanwhile, various functions within the company were relying on differing data sources; often the functions weren’t even aware that alternative sources existed. Human beings might be able to untangle such problems (though it would be labor-intensive), but traditional IT systems can’t, so the company couldn’t truly understand its relationship with the supplier. The SSOT works at the data level; MVOTs support the management of information. (That is the case at AIG.) The key is to balance offense and defense. A company’s position on the offense-defense spectrum is rarely static. Attrition warfare – A strategy of wearing down an enemy to the point of collapse through continuous loss of personnel and matériel. All rights reserved. Before that the strategy of Pakistan Army had more of a defensive bias, i.e., two-third troops in holding role and one-third for offensive. Data lakes are an ideal platform for SSOT-MVOTs architecture. Companies need a coherent strategy that strikes the proper balance between two types of data management: defensive, such as security and governance, and offensive, such as predictive analytics. Until a few years ago, technological limitations made it hard to build the SSOT-MVOTs data architecture needed to support a robust data strategy. Harvard Business Publishing is an affiliate of Harvard Business School. In our experience, a more flexible and realistic approach to data and information architectures involves both a single source of truth (SSOT) and multiple versions of the truth (MVOTs). More than 70% of employees have access to data they should not. … Offense volleyball tactics: The "4 - 1 - 5" play is the play most commonly run by setters and is the easiest offensive play to learn. Defense, he argues, is day-to-day and operational, and at P&G is largely overseen by permanent IT teams focused on master data management, information security, and so forth. [CDATA[ Data defense is about minimizing downside risk. The SSOT is a logical, often virtual and cloud-based repository that contains one authoritative copy of all crucial data, such as customer, supplier, and product details. When companies lack a robust SSOT-MVOTs data architecture, teams across the organization may create and store the data they need in siloed repositories that vary in depth, breadth, and formatting. But data governance isn’t particularly fun. Position Defense. In an article published in Harvard Business Review, the authors view data strategy as having two styles: offense and defense. Of course, this tool is not a precise measure. But data theft is common, flawed or duplicate data sets exist within organizations, and IT is often behind the curve. Although the SSOT-MVOTs model is conceptually straightforward, it requires robust data controls, standards, governance, and technology. Offensive data strategies focus on getting value out of data to build better products, improve your competitive position, and improve profitability, while a defensive data strategy is focused on things like regulatory compliance, risk mitigation, and data security. In a defensive tennis situation, we advise you to play it safe and bring back the pace of the game to a level that you are comfortable in. Before we explore the framework, it’s important to distinguish between information and data and to differentiate information architecture from data architecture. Sometimes the best strategy is offensive. Offensive strategies come in handy in advancing the achievement of the objectives of a business venture and in improving its market position (Porter, 2008). It must have robust data provenance and governance controls to ensure that the data can be relied on in defensive and offensive activities, and it must use a common language—not one that is specific to a particular business unit or function. Offensive & defensive strategies. Having a CDO and a data-management function is a start, but neither can be fully effective in the absence of a coherent strategy for organizing, governing, analyzing, and deploying an organization’s information assets. Air superiority – Essential to a successful air campaign. Consider how a supplier might classify its clients Bayer and Apple according to industry. We find that companies with the most-advanced data strategies started at one point and gradually migrated to a new, stable position. Many companies will find that they can fund their entire data management programs, including staff salaries and technology costs, from the savings realized by consolidating data sources and decommissioning legacy systems. All rights reserved. In this article we describe a new framework for building a robust data strategy that can be applied across industries and levels of data maturity. Let’s return now to data strategy—striking the best balance between defense and offense and between control and flexibility. Emerging technologies may enable a next generation of data-management capabilities, potentially simplifying the implementation of defensive and offensive strategies. Indeed, without such strategic management many companies struggle to protect and leverage their data—and CDOs’ tenures are often difficult and short (just 2.4 years on average, according to Gartner). Defensive strategies are used to discourage or turn back an offensive strategy on the part of the competitor. Using this approach, managers can design their data-management activities to support their company’s overall strategy. Man-on-man defense. Data breaches are common, rogue data sets propagate in silos, and companies’ data technology often isn’t up to the demands put on it. Some offensive soccer teams will play Possession Ball. But CDO Guy Peri and his team realized that the various business units had valid needs for customized interpretations of the data. Because SSOTs and MVOTs concentrate, standardize, and streamline data-sourcing activities, they can dramatically cut operational costs. As Peri points out, defense and offense often require differing approaches from IT and the data-management organization. Fortunately, artificial intelligence tools that can sift through such data chaos to assemble an SSOT are becoming available. It is a developed to protect market share, position and profitability. The key innovation of our framework is this: It requires flexible data and information architectures that permit both single and multiple versions of the truth to support a defensive-offensive approach to data strategy. Defending your business strategy is about knowing the market you’re best equipped to operate in and about knowing when to widen your appeal to enter into new markets. Defensive Strategy. What’s critical is that single sources of the truth remain unique and valid, and that multiple versions of the truth diverge from the original source only in carefully controlled ways. In contrast, defensive strategies are used to discourage or turn back an offensive strategy on the part of the competitor. Many companies have both data lakes and warehouses, but the trend is for more and more data to reside in a lake. Objectives of offensive strategies: To maximize the sales; To destabilize the current market leader; To acquire market share; Defensive strategies: Defensive strategies are management tools that can be used to fend off an attack from a potential competitor. Defensive strategy Types of offensive strategy Reactive to market. This gives the offense a chance to re-group and form a new attack on goal. Defensive defense combines defensive strategy with defensive operations to fend off attacks; offensive defense combines defensive strategy with offensive operations to prevent or punish enemy attacks. The process is inefficient and expensive and can result in the proliferation of multiple uncontrolled versions of the truth that aren’t effectively reused. endorses offensive strategies tends to adopt more active state behaviors in international politics (e.g., engaging an opposing country first), whereas another who endorses defensive strategies tends to adopt more passive state behaviors in international politics (e.g., focusing on fortifying one’s defenses). Offensive competitive strategies try to shape an industry through first-mover and other aggressive moves. Manage the angles of the court. This is a long pass to another area of the field that has less defenders. Additionally, although his business is in financial services, it’s not heavily regulated. The framework will help managers clarify the primary purpose of their data, whether “defensive” or “offensive.” Data defense is about minimizing downside risk: ensuring compliance with regulations, using analytics to detect and limit fraud, and building systems to prevent theft. The opposite path—from offense toward defense, and from flexible toward controlled—is possible but usually more difficult. At the SSOT level these companies belong, respectively, to chemicals/pharmaceuticals and consumer electronics, and all data about the supplier’s relationship with them, such as commercial transactions and market information, would be mapped accordingly. A decentralized approach is well suited to offensive strategies because it can increase the agility and customization of data reporting and analytics. In many companies, among them Wells Fargo, CIBC, and P&G, the CDO is responsible for both analytics and data management, facilitating the ability to balance offense and defense. It considered West Pakistan as the center of gravity for the defence of the country. These include blocking or … More than 70% of employees have access to data they should not, and 80% of analysts’ time is spent simply discovering and preparing data. Another good offensive soccer strategy is to Switch the Attack. This allowed the company to rationalize its key data systems; eliminate much supporting IT infrastructure, such as databases and servers; and cut operating expenses by automating previously manual data consolidation. Many organizations have attempted to create highly centralized, control-oriented approaches to data and information architectures. Copyright © 2020 Harvard Business School Publishing. Activities include ensuring compliance with regulations (such as rules governing data privacy and the integrity of financial reports), using analytics to detect and limit fraud, and building systems to prevent theft. This strategy is often overlooked by many sellers because they feel they don’t need to advertise to people who are already searching for their product and that it’s just a … For example, one source identified a supplier as Acme; another called it Acme, Inc.; and a third labeled it ACME Corp. Defensive investment strategies are designed to deliver protection first and modest growth second. To determine a company’s current and desired positions on the offense-defense spectrum, the CDO must bear in mind, among other things, the company’s overall strategy, its regulatory environment, the data capabilities of its competitors, the maturity of its data-management practices, and the size of its data budget.
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