Innovators like Amazon and Google – and the start-ups nipping at their heels – continue to transform the 21st-century business world. How can we keep up?
In two words: Hill Climbing.
Hill Climbing is an approach for our data-driven age that provides path away from organisational politics and toward true meritocracy, by embracing the attitudes and approaches shared by disruptive tech companies.
The genesis of the computer science term “hill climbing” (lower case to signify its original use) involved theoretical hills: thought experiment posited an unknown, low-visibility terrain from which one had to navigate to the highest spot. The first step of the solution was literal first step: move one foot forward in any direction so long as you move higher. That strategy would quickly take you closer to your goal – even from random beginning, and with little other information.
For today’s businesses, Hill Climbing is an optimisation technique that postulates the continuous improvement of solution – from any starting point. Iteratively testing small – and medium-sized changes to an initial solution lets you improve that solution incrementally, and replaces opinions, guesses, and hunches. The approach can be applied against any aspect of business: from design, to pricing, offer management, user interface design, and marketing programmes. Disparate disciplines adopt this type of testing to coax clear strategies from overwhelming types and amounts of data.
As management approach, Hill Climbing promises more than demonstrably powerful analytical techniques. What first enabled the Silicon Valley revolution and its now-global reach have been the approach and attitudes permeating first the garages, and eventually international corporate cultures: belief in data and commitment to testing, both of which flatten hierarchies and empower everyone in an organisation to innovate. As different segments of your organisation realise clear and often dramatic gains, innovation can blossom from “non-designated” personnel, not just SVPs of Strategy.
Many of our core team members here at RichRelevance worked at Amazon, gaining first-hand experience with fundamental tenets that comprise the Hill Climbing approach. So how do you architect system that can scientifically arbitrate across disparate ideas?
Below are three key components:
Data democratisation: Make data available to all employees in fluid, low-cost, high-efficiency way that best enables them to serve the business.
Consistency of measurement: Businesses are measured by various metrics, and not every project will track them all. But whatever metrics each project tracks should be consistent. That is, always compare apples to apples, so the data will be useful throughout the organisation.
Willingness to test at all levels of the organisation: Many of the best ideas in business come from people who are not currently empowered to execute their decisions.
Tech disruptors outperform competitors in every single vertical they enter because they are data-driven. By committing to listen to and constantly optimise the data and ideas that arise from employees, we can foster true meritocracy. As decision-making framework, Hill Climbing has the capacity to transform your business.
David Selinger, CEO and co-founder of RichRelevance, is world-renowned expert in the field of eCommerce data analytics. When leading Amazon’s Data Mining and Personalisation team he increased Amazon’s profit by over US$50 million, setting the industry standard for personalisation. He will be keynoting at the upcoming MindStorm Conference on 18 April.
Visit www.mindstorm.co.nz for more information.
