What is a data leader?

And, why do you need one?

Unlocking the full potential of your data requires technology, business acumen, and – in our experience – usually a big dose of culture change. The results can be impactful, but achieving them requires focus and long-term dedication. And that’s where a data leader comes in: someone who will spend all of their time focused on ensuring that your organization has the right tools and technology in place, that engineers and analysts are focused on maximizing business value, and that programs are in place to increase data literacy and data usage across your organization.

For growth-stage businesses seeking to understand the power and potential of their data, an analogy from the sporting world may help. In 2021, Emirates Team New Zealand – a team known for its extensive use of data – won the 36th America’s Cup sailing race. Data – gathered through sensors placed on all parts of the boat to detect speed, wind and stress forces – helped inform the boat’s radical new foil design. Historical data about the course and competitors was used to inform race strategy. Real-time data was used during the race itself to fine-tune bearings, sail position and crew actions. Opportunities for data in your business can be framed in three analogous buckets. The boat is your product: data can be used to inform and improve the product and, in some cases, may be the product itself. Race strategy is your go-to-market strategy: data from across your sales and marketing efforts can help you to understand your customers, evaluate the competitive landscape, and focus your resources more efficiently. The race itself is your day-to-day operations: data can help you fine-tune customer support interactions, marketing campaigns, merchandising and product performance. The right data leader can help ensure that your company’s data put wind in your sails and help your teams steer in the right direction.

When to hire a data leader?

Recognizing the “data opportunity” within your organization

While there is no perfect time to hire a data leader, you may need this hire earlier than you think. In our experience, there are a few relevant inflection points for growth-stage businesses to consider.

  1. You have found product-market fit, won customers, and are expanding your sales, marketing, and / or product development investments. Data can (and should!) be used to evaluate the most promising investment areas, assess progress along the way, and provide tactical tools and visibility that allow the other functions to perform at their highest level. A data leader will usually build the function from scratch, assessing the data sources and planning technology needs.
  2. Your organization has a collection of data resources – databases, reports, and analysts – but these resources provide an incomplete picture of your organization and it’s a struggle to turn them into real business value. Often, the data may tell you different stories: the numbers in the marketing report may not match what finance sees; the product team is releasing features but usage numbers aren’t going up. A data leader can help reconcile data sources and definitions on a technical level, create cultural buy-in for sources of truth, and align the work of analytical employees.

Who is the right data leader for your business?

Understanding the ways your data can be used

Once you’ve recognized the need for a data leader, the next step is to figure out the type of data leader that will be most relevant for your organization. Consider your company’s current data maturity and the greatest points of impact for this role.

To assess data maturity, consider both technology and people. Are you collecting consistent data about sales, customer interactions, and product usage? Do you have a data warehouse and business intelligence tool? How comfortable are current employees with data and basic statistics concepts? Does the executive leadership team use data to set strategy? The data leader’s role usually includes building data infrastructure, developing employee skills, and advising executives, but knowing where your biggest gaps are will help you focus on the right candidates.

When considering a candidate’s background, think about more than a laundry list of coding languages and buzzwords. First, consider the “minimum requirements” for this role. Does your industry have specific regulatory requirements, such as HIPAA or GDPR, in which your data leader must be conversant? Are there specific operating metrics or sector dynamics your ideal candidate should understand well? A growing subscription business, for example, may want to prioritize someone who can quickly get their arms around subscription data. Consider, too, how important experience with hiring, people management, and/or project management will be to this role. Do you plan to build a team around this hire? Data and business analytics are constantly covered in today’s news. It’s critical to look beyond headlines on topics like AI or big data and be thoughtful about how to make this role impactful within your organization.

How do you recruit and retain a great data leader?

Communicating what’s distinct about your data and the opportunity it presents

Once you’ve decided to hire a data leader and thought through the type of data leader you need, how do you recruit – and then retain – a data leader?

First, frame the role in terms of business opportunities, not just pain points. Reconciling inconsistent reports is not nearly as compelling as using data to help transform an industry with customer-centric products. There will be plenty of the former, but don’t let that get in the way of the real goal: leveraging data to improve insights and execution and achieve your company mission.

Second, consider what may be unique and interesting about your data set. Sell your data to your data leader! Contrary to the view in popular press, size of the data isn’t the only attribute that can make a compelling data set. The type of data, the unique view into a particular process or customer behavior, the industry in which you operate, or the type of customers you serve are all part of your unique opportunity. The narrative you set around your data will not only help you recruit a leader but will help them recruit and motivate their team members in turn.

Finally, recognize that your current and future data needs are varied, but individuals tend to have strengths and passions in a narrower set of them. Develop a clear and detailed understanding of your organization’s data needs. Then, work to hire someone who can nail your most pressing requirements and arm them with a mandate – and resources – to tackle the rest.

As we learned from the 2021 Emirates Team New Zealand, understanding and effectively applying data can lead to great outcomes. For growth businesses seeking to unlock the full potential of their data, hiring a talented data leader can help steer your team in the right direction.

For more information on the role of a data leader or additional perspectives and frameworks designed to support the growth of your business, please visit our growth company resource center or subscribe to our newsletter.

ABOUT THE AUTHOR

Cathy Tanimura is Vice President of Analytics & Data Science at Summit Partners. She works closely with the Summit team and our portfolio companies to help create and execute strategies that effectively use data and analytics to drive better decisions and build better products. She is the author of SQL for Data Analysis: Advanced Techniques for Transforming Data into Insights. Prior to Summit, Cathy worked at Strava, where she built an analytics and data science team focused on product, marketing and business development. Previously, she led analytics teams at Okta and Zynga.

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