In 2015, a wild-card team with unknown riders and a third of its rivals' budget took some of the biggest honors at the Tour de France. Better legs were not the difference. Better data was. The same lesson applies to every business decision you make.
An underdog at the Tour
Until 2015, no African team had ever raced the Tour de France, the most famous cycling race on Earth. That year MTN-Qhubeka, a relatively unknown South African team, won the wild-card slot. Its budget was about €7 million against a reported €30 million or more for Team Sky. It was also the first Tour team with Black African riders.
From July 9 to Bastille Day, Eritrea's Daniel Teklehaimanot held the King of the Mountains jersey, the first African rider ever to wear it. On July 18, Mandela Day, Steve Cummings won stage 14. For an underdog team, those were extraordinary results. So what changed?
Strength, strategy and science
Success in cycling sits where three things cross:
- Strength: each rider's natural ability, commitment to training, and will to compete.
- Strategy: the art of the race. Riders travel in a pack, the peloton, so those in front block the wind and the riders behind save energy for the moment they break away.
- Science: knowing when to break away and how hard to ride to keep the lead. That depends on knowing the time gap, the distance and speed of the peloton behind you.
Until 2014, the time gap was measured by two people on a motorcycle. They rode up behind the breakaway, estimated its speed, stopped, started a stopwatch and timed how long the peloton took to catch up. They radioed the result to the race officials and then, remarkably, wrote it on a chalkboard and rode up to show the riders.
By the time a rider read that chalkboard, the numbers had already changed. The data was indicative at best and mostly irrelevant.
In 2015, Dimension Data and its partners put telematics devices on every bike. For the first time, teams could see each rider's location, speed and altitude, in real time, anywhere on the course. With the right data, in the right place, at the right time, knowing when to break away and how hard to push became a matter of science. Riders like Daniel and Steve turned that data into competitive advantage.
From data to evidence
Today you can get a near-infinite amount of data about almost anything with one click. That makes it more important, not less, to separate the signal from the noise. Before digitization, data misled us because it was stale. Now it misleads us because there is so much of it.
Big data is like crude oil: plentiful, but unusable until it is refined. Whether your data is big or small, what matters is having the right data, then refining it into information, and information into knowledge you can act on.
The FACTS framework
The simple framework I use to build evidence-based decisions is called FACTS:
- F
- Firm up the strategy and goals. As George Harrison sang, if you don't know where you're going, any road will take you there. Without a destination, it is very hard to create a result.
- A
- Acquire the right data. It must be relevant to the goal. Look for variety (several sources, fewer biases), velocity (a trend, not a single snapshot; a point does not a trend make) and veracity (accuracy). In practice: what you own, what it costs, how much is used, how it is used, and how it is bought.
- C
- Create evidence. Turn information into knowledge that defines the road you will take.
- T
- Transform. Understand where you are today and how you will get where you are going.
- S
- Successful implementation. Execute against the plan, and measure it.
Watch for the data head fake
In February 2015, a photo of a dress went viral with one question: what color is it? About 57% of people saw blue and black, 30% white and gold, and 10% blue and brown. The dress was blue and black. With exactly the same data, nearly one in two people reached the wrong conclusion.
In sports, a head fake is a feint: a player signals one direction and goes the other. Data can do the same thing. Incomplete data, or data seen from the wrong perspective, can send you confidently down the wrong path. Photograph that dress in different light, with skin tones for reference, and everyone sees blue and black. Here are three real client examples of data head fakes.
The ask: audio conferencing costs kept rising, so procurement wanted to rebid the contract for a lower per-minute rate. The goal we firmed up: a cost-effective collaboration solution that would drive adoption.
The head fake: the company ran about 109,000 conferences and 24 million audio minutes a month. But 71% of users were dialing in from their offices to colleagues in the same or nearby offices, about 18.8 million minutes a month of employees calling out to the public phone network just to reach each other.
The transformation: instead of negotiating a cheaper minute, we moved conferencing audio onto the corporate data network, integrated it with their conferencing software, and negotiated SIP and hybrid WAN rates.
The ask: mobile and data-roaming costs were climbing, and the firm was considering bring-your-own-device despite strict rules on data protection. The goal we firmed up: keep governance and control of devices while cutting roaming costs.
The head fake: across 14,000 devices, fewer than 5% of employees roamed in a given month, yet they drove more than 15% of the cost. Data roaming was the headline, at 19% of cost, but when we matched calls to work numbers, 77% were employees calling back into a corporate office.
The transformation: using their existing enterprise voice license, we put a company softphone on every device and negotiated an unlimited data plan switched on only for employees while they traveled.
The ask: the head of communications had done the analysis and needed support in negotiations. The largest spend was the MPLS network, market prices had dropped about 50%, so the team set a goal to cut costs by 50%.
The head fake: the firm was not starting at market. Its rates were already 21% above market, so matching the market meant a 59% reduction, not 50%.
Don't let the road lead you
On a long downhill in a race, you don't simply coast. Knowing where you started, how steep the grade is and how fast your competitors are moving tells you whether to conserve energy or break away. Let the evidence make that call, not the road.
The lessons from the Tour and from our clients are the same:
- Know where you're going.
- Have the right data, and analyze behavior, not just spend.
- Watch out for the head fakes.
- Make evidence-based decisions.
Data becomes information, information becomes knowledge, and knowledge becomes competitive advantage. Evidence matters.
Adapted from Joe Baroudi's "Evidence Matters" series, first written in 2016.