The Insight Management Academy (IMA) are the world’s leading authority on transforming insight teams. This year, The IMA’s CEO James Wycherley condensed 16 years of The IMA’s thinking into a book – Transforming Insight. The book contains advice across 42 areas that’ll help insight professionals identify value, drive change, manage their teams, optimise insight’s impact and plan for the future. It’s vital reading for insight professionals. If you want to make insight commercially valuable, then glue Transforming Insight to your desk and refer to it daily.
This week we’ll be discussing Transforming Insight’s key learnings. Today, we’re discussing how insight can create financial impact.
What is financial impact?
Insight teams across the world conduct impactful work. But insight work isn’t always financially impactful – i.e. it’s value to a business is quantified with a pound sign. And that’s what financial impact is – insight teams doing what they do BUT linking it to financial metrics by valuating insight.
The value of valuation
Putting a monetary value on insight’s worth can help overcome the language barrier between insight and other business units. After all, who doesn’t understand the language of pounds and pence? But it’s more than that.
Understanding insight’s potential financial impact allows insight professionals to identify both: 1) commercial opportunities to exploit and 2) commercial risks to avoid. This is why Transforming Insight refers to insight valuation methods as “the crankshaft of insight commerciality”.
The material of valuation
Key to calculating insight’s financial impact is the necessary financial data. Access to this data is yet another reason for insight professionals to get closer to their finance colleagues. Closing this distance Wycherley says “puts you in a much better place to calculate ROI”. He goes on to say that being able to calculate ROI is a “big win for all insight professionals.”
The skills of valuation
Access to the data needed to calculate insight’s financial impact is one thing. But what skills are needed to make sense of it? Wycherley points to “the interesting things happening in the world of analytics” as the potential source of these skills.
Insight teams are starting to obtain these skills via a new wave of insight leaders who don’t have a traditional insights background. To support this, Wycherley believes insight teams should make better use of the skills they already have in the quest to measure insight’s financial impact, saying “data IS data. And we should be able to use it regardless of its format”.
The cost of stagnation
If insight professionals don’t better measure their financial impact what’ll happen? With more pressure on budgets and other marketing functions valuing their work via econometrics, insight teams must start viewing financial impact as essential. Not obligatory. Failure to do so will see insight used as an information help desk – not the value creating entity it can be.
Identifying insight’s financial impact is undoubtedly one insight professional’s biggest challenges. And one which must be overcome if insight is to prove its commercial worth.
If your insight team needs guidance to help transform itself into a financially impactful tool of value creation then get a copy of Transforming Insight, read it cover-cover, then glue it to your desk and refer to it daily!
Want to know more about Transforming Insight? Then click here.
