Many successful organizations around the world have tapped into the power of data analytics to improve their business operations. Analytics has risen in corporate rank and often now holds a seat at the executive table. Those companies that have taken this approach glean accurate insights that directly inform key business decisions, as well as allow for personalized communications and precise management of customer interactions and lifecycle management.
Justin King, the former CEO of the UK grocery retailer Sainsbury’s, described this landscape as “the haves and have-nots of data”, with companies like Sainsbury’s using their data as a clear competitive advantage as it “enables [Sainsbury’s] and our suppliers to respond to customers’ needs more quickly and more effectively”.
While many organizations have recognized the power of data analytics and have invested heavily in these areas, there are a number of organizations who are constrained in their ability to do so. In particular, in the not-for-profit sector, charities are focused on ensuring that every dollar they receive is put towards their cause. For charities with smaller budgets and fewer resources, it’s a struggle to capture and store data, let alone analyze it.
In response to this situation, and in order to support the communities in which it operates, Aimia launched its Data Philanthropy initiative three years ago. In November 2015, we hosted our third annual Data Philanthropy event in Canada, and have held events in five countries globally, supporting over 40 charities and providing over 16,000 hours of analytical support to date.
In a period of 48 hours, approximately 75 of Aimia’s data scientists and industry experts from a number of Analytics and IT companies and client partners (for example: Fractal, HP, SAS, IBM, CiG and TD Bank) came together and sifted through several hundreds of thousands of records of data. The goal was to provide valuable analytical insights and recommendations to four non-profit organizations – Ballet Jorgen Canada, Enactus Canada, The Stephen Lewis Foundation, and Prostate Cancer Canada – in order to analyze trends and patterns and make recommendations to meaningfully improve their programs.
Examples of the types of insight produced include ways to improve the performance of fund-raising efforts through segmentations of donor data to help with better campaign design and targeting. Also, we also helped one of the charities demonstrate their overall impact as an organization and provided key knowledge around better ways to collect, manage and govern their data.
The event was an opportunity for the analytics community to come together in a short period of time and provide some support for four organizations that provide so much to our community. However, Data Philanthropy is a philosophy more than a single event, and the support of these organizations and others should be ongoing.
Through our Data Philanthropy work, we have found that there are six simple steps that can transform a charity’s ability to use data to improve their performance:
Make sure you capture the data and store it in the correct place: It sounds obvious, but many charities fall down at this first hurdle. If data is to be analyzed, it needs to be collected, then "cleaned" – which means kept in a consistent format – and stored. This isn’t difficult, but it often means making someone responsible for this job. They should be tasked with continually updating and monitoring the integrity of the database and its content.
Use open data sources: It’s not just your own data which will be useful. There are plenty of open data sources which can enrich your own analysis. With one charity we worked with at Aimia, we used the Government’s Index of Multiple Deprivation to identify areas most in need of investment, which helped them decide where to set up a youth centre.
Know how to measure your results: Tracking against ‘control’ groups is important here. For example, if a charity is aiming to measure the impact it has on people, it needs to track a group of people who are receiving support over time against a ‘control’ group – an identical group of people yet to receive support. By comparing the two groups’ results, it will be clear that any positive effects seen in the first group, which is receiving support, are the result of that support rather than circumstantial.
Focus on presenting the data well: Transforming your data into visuals can dramatically improve the impact of your message, so getting it right is important. At Aimia, we follow four simple steps: identify your message, construct your chart, cleanse your chart, and extract your message. It’s easy to overload people with stats, so just keep it simple.
Draw out insights which you can act on: Even the biggest companies can struggle to find actionable insights. These are the insights which not only tell you something, but tell you what you subsequently need to do. An insight could be that Greenhouse, the youth sports charity we helped last year, is occasionally more effective when working with girls instead of boys. An actionable insight would be that Greenhouse is more effective when trying to get girls to play tennis, rather than basketball. Greenhouse can act on this by offering even more opportunities to play tennis than basketball.
Consider hiring a data scientist: While this is a challenge for many charities, there are a few that have actually already taken this step. When data has the power to improve the effectiveness of your work, and increase funding, hiring a data scientist could be a shrewd move. In 2014, Aimia helped four charities to gain over £2.5 million of new funding as a direct result of new insights, showing the scale of the potential benefit.
In the future, it would be great to see charities being able to use their data more effectively and to benefit from taking a more analytical, stakeholder-centric approach to their operations. In the meantime, our commitment to Data Philanthropy means that as analysts, we are able to give something back to the community, donating the most valuable asset of all: our skills and time.