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Five Lessons Business Leaders Can Learn From A Data-Driven City

By News Creatives Authors , in Leadership , at November 19, 2021

The Challenges of Becoming Data-Driven

Research shows companies that leverage data perform much better than their peers. MIT professor Erik Brynjolfsson found companies that embrace data-driven decision-making enjoy 5% to 6% higher output and productivity. While Forrester estimates data-driven businesses are growing at an average of more than 30% annually.

According to recent research, 99% of blue-chip companies are investing in deriving better insights from data about their customers and businesses. But only 24% have successfully created a data-driven organization, and 92% of them cite people, business processes, and culture as their greatest challenges.

We can learn a lot about how to overcome those challenges from one of South Africa’s biggest cities.

The Durban Water Crisis

eThekwini is a municipality in South Africa’s KwaZulu-Natal province, which includes Durban, the third-largest city in South Africa with a population of 3.9 million. In 2018, Cape Town, South Africa, came close to running out of water. eThekwini officials recognized that they might be next.

Like many other cities, Durban wrestles with aging water infrastructure. Durban loses 50% of its municipal water supply to leaks from its aging pipes, poor metering, and theft. eThekwini’s officials had the data they needed to pinpoint the losses, but they couldn’t derive insights from it. So, they embarked on a project to unlock its value.

Five Steps to Becoming Data-Driven

To improve data-driven decision-making, the eThekwini municipality took five steps that other organizations can learn from.

1. Build Diverse Teams and Leverage Their Experience

In 2020, a delegation from eThekwini visited Arizona State University’s Smart City Cloud Innovation Center (CIC). The CIC is powered by Amazon Web Services; it uses AWS’s processes and services to solve community challenges such as reducing homelessness. Once they decided to work together, eThekwini, their water sector partners, the CIC, and AWS worked to understand the data they had and the problem they wanted to solve.

This is typical of the kinds of partnerships organizations forge when they commit to become data-driven. At the outset, few have all the skills and technology they need in-house, and they can learn a lot from experts in other organizations and domains.

2. Work Backwards from The Customer

The CIC and eThewikini teams first narrowed the objective to a specific challenge: to reconcile the water the municipality purchased with the amount it sold. That would help it figure out where it was losing water and intervene to stem the losses.

The CIC led a two-day virtual Amazonian Working Backwards engagement with eThekwini officials to define a solution that would provide the most value to the municipality’s customers. The team defined a data platform to support the essential functions of water operations which they called SHANA, short for “ukushintshana,” which means “exchange” in Zulu.

Raw data does not assist decision-making. This program assisted a great deal in analyzing the data so that information is ready for decision-making. People tend to support technology when they see the benefits. That’s what this program has achieved.” — Sibusiso Makhanya, deputy city manager for Trading Services, eThekwini Municipality

Then the team created a “minimum viable product,” a pilot designed to get early feedback and learnings from customers. By working backwards from the customer need, rather than forward from the technology, the team built a product that would add real value.

3. Push Responsibility to The Edge

In a modern data community, the IT department is not responsible for data ingestion, quality, or insights. Instead, responsibilities reside deeper in the business organization.

The SHANA solution typifies the modern data community, comprising three roles: data producers, platform, and consumers. At eThekwini, the producers are the water suppliers, finance team, and maintenance team. The consumers are the individuals and teams within the Water and Sanitation Unit that use the data and data scientists who derive new insights.

Between the producers and consumers is the platform team comprising a small group of ASU CIC data engineers who ensured that the proper infrastructure and services were available.

4. Encourage Organization-Wide Data Literacy

Before SHANA, eThekwini’s water unit kept its data in spreadsheets. It was incomplete and difficult for anyone who wasn’t a data analyst to understand.

During the SHANA project the water unit staff could experiment with the platform, learn by doing and, in the process, become more data-literate. They then showed government leaders outside the water unit why and where they needed budget for tools, like smart meters, to stem the water loss.

An initial use case like this is vital for getting buy-in within an organization. When projects produce outcome-focused data products, they help build a data-driven culture. In the SHANA project, eThekwini leaders saw what was possible, which created an appetite among other senior leaders for further data initiatives to deliver insights.

5. Build A Modern Data Platform

A data-driven organization needs a data architecture that is scalable, provides seamless data access, and has unified governance. It must also have new and continually better ways of analyzing and presenting data.

The SHANA platform is cloud-based, so it could be set up immediately and scaled as needed. SHANA started with data from three sources, but producers can add more as they need them. Also, the ASU CIC uses 95 AWS services, so the team had access to advanced tools like Amazon QuickSight, which can read and consolidate data in different formats.

Once data is in SHANA, it can be operated on directly without having to copy or move it. When consumers find their datasets, they can use their preferred tools to perform their analysis. Built-in data standardization gives SHANA users confidence that everyone is working off the same set of information.

Results Today and A Platform for The Future

Thanks to SHANA, eThekwini officials now better understand the municipality’s water losses and can act to reduce them.

SHANA also supports rapid proofs of concept for further sustainability initiatives like smart water metering, which will enable eThekwini’s water agency to identify where it’s losing water, why, and how to fix it.

And SHANA has become a springboard for other smart city initiatives. The water unit is now scaling and leveraging the platform for multiple city functions, including workforce productivity, electricity consumption, and traffic patterns.

The Working Backwards workshop created a ripple effect among my colleagues, to start thinking more about the data and innovating with data as a strategic tool.” —Dr. Sandile Mbatha, senior manager, Research and Policy Advocacy, eThekwini Office of Strategic Management

Leveraging data in your organization

By working backwards to identify a compelling customer-focused solution, building data skills, and leveraging agile cloud technologies, the eThekwini Municipality is gaining valuable insight into many municipal challenges.

Many organizations are using data to solve problems, unlock new revenue opportunities, reduce costs and risks, and enhance their customers’ experience. They too understand that applying a modern methodology that incorporates mindset, people, and process transformation is just as crucial as using leading-edge technology.

Learn more about how to start and scale your data strategy.

A longer version of this article was previously published on AWS Executive Insights.

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