Transforming into an Analytical Organization: Beyond Data and Technology

Analytics within a traditional organization often starts as a top management initiative aimed at increasing productivity. Implementation faces several challenges, and top management sponsorship could quickly fade away. Banorte, the largest Mexican financial group, is under way to successfully transform into an analytical organization. This experience offers five lessons to start out such a transformation:

The Five Lessons

  1. Gain credibility by delivering short-term results that assure long-term sponsorship from top management.
  2. Set the right incentives for the organization to embrace analytics, avoiding rivalry between analytics and the business lines.
  3. Do not take for granted that analytic projects are a priority for the whole organization — hold the analytics group accountable for end-to-end implementation.
  4. The analytics team members beyond quantitative skills require the ability to build consensus across different stakeholders within the organization.
  5. The contribution from analytic initiatives must be measured.

A traditional organization that aims to become an analytical firm with the capacity to deepen and extend its relationship with its customers starts its journey with some leaders envisioning a future for the company. It is not uncommon to find contrasting visions within top management of what should be the future — some subscribe to the old Texas adage, “If it ain’t broke, don’t fix it.” This should not be a surprise since companies have limited resources, and there are competing projects that respond to existing customer demands. Hence, when the organization embarks on the transformation path, it is clear that the analytical camp prevailed, but this does not mean that the traditional camp was convinced. Top management composition is not static, and suddenly the forward-thinking camp that once prevailed to launch the transformational analytic initiative might be outnumbered. Assuring continuity requires the analytic team to gain credibility with both camps of the organization. A high short-run ROI does the trick. Analytics in Banorte during its first year of operations contributed 10% of the group’s total net profit, gaining credibility and resources to advance with medium-term projects.

A high yield from analytics is a necessary but insufficient condition. Analytics and the business lines must establish a partnership that will face some hurdles. Analytics will disrupt the way business has been conducted, and rivalry between groups might arise. Both groups speak different languages — one group has business experience while the other talks with statistics and models. The business lines have many concerns — devoting scarce resources to unproven projects, the credit they will get in case of success, or the blame they will share if failure occurs. These concerns must be addressed by the design of an incentive scheme that aligns the interests of analytics and the business lines. Banorte solved this problem by setting a shadow target for analytics that did not rival the business lines targets, but rather analytic projects helped business lines attain their targets.

Non-rivalry between groups does not guarantee that the business lines and other stakeholders will enthusiastically embrace analytic initiatives to change the way they have been working. Stakeholders within the organization are unfamiliar with analytic initiatives, and they certainly have other projects top of mind. It is of an utmost priority for analytics to find partners willing to champion initiatives that can set an example to the rest of the organization. Analytics will need to invest some of its top management sponsorship capital in assuring end-to-end implementation of the chosen projects. The transformational effort at Banorte initially focused on the credit card business because of the project’s value and the willingness from the business partners.

An analytics team obviously requires quantitative skills, and the organization has to make a substantial investment in data and technology. However, these prerequisites are not enough to transform an institution. Banorte’s experience has shown that two soft skills are vital — the ability to build consensus and to have good team players who respect the business acumen of their counterparts. Business lines expect the quants to be a partner, not a lecturer.

Finally, rooting analytics within the organization requires measurement. It is not uncommon for an organization on its path to transformation to undertake several initiatives at the same time, and it may prove hard to disentangle the contribution. The analytics team should not assume that results are self-evident — a detailed report to the top management must be produced periodically. Furthermore, it is easy to stray from value by undertaking only the projects from willing partners. At Banorte, measurement has assured sponsorship and has kept analytics on track.

Journal of Integrated Marketing Communications (2017), Northwestern University

José A. Murillo, Ph.D.

Chief Analytics Officer, Grupo Financiero Banorte, Mexico

Jose Antonio Murillo Garza is an analytic leader with a distinguished track record of translating analytics into high profits. He established and leads the Analytics Business Unit at Banorte –Mexico’s second largest financial group. His team develops a deep understanding of Banorte’s customers with the aim of finding opportunities to increase profitability. He assures end to end implementation of the projects which his team undertakes. During its first year of operations (2015) the value created by the Analytics team was equivalent to 9 percent of Banorte’s total net profits. During the second year of operations the Analytics contribution increased to 20 percent of Banorte’s total net profits. In 2016 he was awarded the Lafferty Global Award on Credit Card Excellence for the impact of analytics on Banorte’s productivity. Prior to Banorte, Dr. Murillo Garza was a top ranking official at Mexico’s Central Bank, an advisor to the International Monetary Fund and taught economics at Rice University, ITAM and El Colegio de Mexico. He holds a BA in economics from ITAM (graduated with honors and received national prizes in economics from the National Chamber of Commerce and Tlacalel National Prize in Economics) and a PhD in economics from Rice University.

Comments

  1. website says:

    Thanks for sharing your info. I truly appreciate your efforts and I will be waiting for your next write ups thanks once again.

  2. We are a group of volunteers and starting a brand new scheme in our community. Your website offered us with helpful information to work on. You’ve performed a formidable process and our whole community can be grateful to you.

  3. click here says:

    Hey! Would you mind if I share your blog with my zynga group? There’s a lot of folks that I think would really enjoy your content. Please let me know. Many thanks

  4. website says:

    I’ll immediately snatch your rss as I can’t find your email subscription hyperlink or e-newsletter service. Do you’ve any? Please let me recognise in order that I may just subscribe. Thanks.

  5. homepage says:

    With havin so much content and articles do you ever run into any problems of plagorism or copyright violation? My blog has a lot of exclusive content I’ve either authored myself or outsourced but it seems a lot of it is popping it up all over the web without my authorization. Do you know any ways to help reduce content from being ripped off? I’d genuinely appreciate it.

  6. my blog says:

    It is appropriate time to make some plans for the future and it is time to be happy. I have read this post and if I could I wish to suggest you few interesting things or tips. Perhaps you could write next articles referring to this article. I desire to read even more things about it!

  7. my blog says:

    We absolutely love your blog and find almost all of your post’s to be what precisely I’m looking for. Does one offer guest writers to write content for you personally? I wouldn’t mind writing a post or elaborating on some of the subjects you write about here. Again, awesome site!

  8. homepage says:

    Fastidious answers in return of this matter with real arguments and explaining all on the topic of that.

  9. homepage says:

    Definitely believe that which you stated. Your favorite justification seemed to be on the internet the simplest thing to be aware of. I say to you, I definitely get irked while people consider worries that they plainly do not know about. You managed to hit the nail upon the top as well as defined out the whole thing without having side effect , people can take a signal. Will probably be back to get more. Thanks

  10. click here says:

    Your way of explaining all in this paragraph is truly pleasant, all can easily know it, Thanks a lot.

  11. I have been browsing online more than 2 hours today, yet I never found any interesting article like yours. It’s pretty worth enough for me. In my view, if all website owners and bloggers made good content as you did, the net will be much more useful than ever before.

  12. click here says:

    Excellent blog here! Also your web site quite a bit up fast! What host are you the use of? Can I get your affiliate hyperlink to your host? I desire my site loaded up as fast as yours lol

  13. my blog says:

    I am in fact grateful to the owner of this site who has shared this fantastic article at here.

  14. click here says:

    Hi there exceptional blog! Does running a blog similar to this require a large amount of work? I have absolutely no knowledge of coding however I had been hoping to start my own blog soon. Anyway, if you have any recommendations or techniques for new blog owners please share. I know this is off topic nevertheless I simply needed to ask. Thank you!

  15. my blog says:

    I just couldn’t leave your web site before suggesting that I extremely loved the usual info a person supply for your visitors? Is gonna be back incessantly in order to check up on new posts

  16. click here says:

    Hello There. I found your blog the usage of msn. That is an extremely smartly written article. I’ll make sure to bookmark it and return to read more of your useful info. Thank you for the post. I’ll definitely return.

  17. home page says:

    It’s going to be finish of mine day, but before end I am reading this wonderful article to improve my experience.

  18. homepage says:

    I will immediately clutch your rss feed as I can’t in finding your e-mail subscription hyperlink or e-newsletter service. Do you’ve any? Please permit me recognize so that I may subscribe. Thanks.

  19. click here says:

    You’re so cool! I do not believe I’ve read a single thing like this before. So nice to find someone with unique thoughts on this topic. Really.. thank you for starting this up. This website is something that is required on the internet, someone with a bit of originality!

  20. nba 2k18 mt says:

    It’s impressive that you are getting thoughts from this post as well as from our discussion made at this place.

  21. Just wish to say your article is as astonishing. The clarity to your post is simply excellent and that i could suppose you are knowledgeable on this subject. Fine along with your permission allow me to grab your feed to stay updated with impending post. Thank you a million and please continue the rewarding work.

Leave a Reply

Your email address will not be published.

Corinium Global Intelligence is registered in England & Wales, number 08520994. Registered office:
Brook House, School Lane, South Cerney, Cirencester, GL7 5TY.

Share This