“How Evidence can influence policy and the role of Business Link in

the North West”

A Presentation to Business Link Northwest

by

Ged Mirfin

Definition“Data-driven decision-making is using data to better understand

what is actually going on rather than what is assumed to be going

on”

The Curse of Bad Data•Data is now far easier & cheaper to gather, store, analyze and disseminate than ever before

•Unfortunately this means that it is much easier to collect data that is inaccurate, out-of-date or at worst simply wrong

•Results in a lack of trust of data by end-users

•Decision-makers are thus forced trust to their own intuition.

•Tendency to rely on the infallibility of their own “judgemental opinion” because it is simple & convenient.

•Results in a “Traditionally it has always been done that way mentality”.

•No one is able to prove conclusively otherwise or show policymakers they are wrong.

•The result – badly formulated and more poorly applied policy!

•Works fine in a benign economic environment. In a harsher climate when assumptions are being fundamentally challenged it is much more difficult to defend the indefensible and to find a solution when you are sometimes forced to justify not only your very existence but the funding rationale!

•Need for Hard evidence: high quality validated quantitative data

•Is why Policymakers have turned to a data-driven approach

Governing by Numbers: Data-driven evidence based policymaking: what is it?

•Collection and analysis of data to spotlight problem areas and potential solutions – data capture & accessibility!

•Development of quantifiable measures & indices to assess policy performance and draw comparisons across similar circumstances, geographical boundaries or peer groups so “best practice” can be identified & widened – segmentation & benchmarking!

•Public dissemination of data and metrics/indices to assist in policy formulation, policy making and ultimately in assessing the impact of policy and policy performance – should it be done? has it been done? and has it been done well?

Data Driven Evidence-based Policy Formulation

Aim: Facilitate change from Anecdotal &

Judgmental to Evidence-based

Policy formulation

Evidence-influenced

Evidence-based

Opinion-basedEvidence-influencedB

LN

W D

ata

War

eho

use

Policy Making Environment

Experian

Northwest

Business

Database

Political Inputs

Source: Morgan Stanley as at 30 June 2006

1% -1%

Rate

+100%                  

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+60%                  

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+30%                  

+20%                  

+10%                  

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-80%                  

-90%                  

-100%                  

CRM 3 – Powerful Engine. Huge Development

Potential. Vanilla Version no

Customisation.

Data Import into CRM - manually fills the system with very

poor quality & aged data from legacy

systems.

Poor attempt to address data quality

issue via “Data Cleanse” carried

out by Third Party results in the overwriting of

current data with even older data.

This affected CRM system and hampered

operational performance

Building of Data Warehouse to separate and report on new data delivers

highly functional web accessed

granular reporting capability

Lack of clean up-to-date prospect

marketing data begins to impact on

BLNW’s ability to meet

penetration targets

Arrival of Experian NBD with access to Yell, Thomson, Commercial, & Origins Mosaic

gives BLNW access to a rich

data source which it can be segmented to target specific

customer details in a scientific

manner

The development

of a Web Accessed Reporting Dashboard

with the ability to represent data via GIS

Mapping software and

the development

of a Marketing Data

Warehouse taking BLNW Reporting & Analytical

Capabilities to the Next Level.

BLNWs Capability Levels:

How Data has affected this

BL

NW

Cap

ability

Experian’s NBD

-Business Link had 100k company records in its database.

-The companies had been assisted by Business Link over the last 20 months

-The data captured was used to satisfy contract outputs and as such was very specific

-We needed to increase the data set both in terms of size and data richness

-Experian profiled Business Link data and found 536k businesses (both Ltd. And unincorporated) at location in its National Business database for the Northwest.

-Business Link acquired the data from Experian. Each Experian record had in excess of 180 data characteristics (appends)

-The extra data records allowed a significant level of analytics to be done. The data had access to classification systems (YELL Thompson) and allowed for detailed segmentation

-One of the Primary data attributes was “Risk Scores and Financial Performance data”

100k

536k

Data Attributes•Data is “real time” - updated monthly and in case Commercial Risk Data the plan is fortnightly with Weekly Alerts for Businesses experiencing a serious worsening in their performance

•Is the first (b2b) business profiling system in the public sector

•Offers real time intelligence to support our efforts to address the current market conditions

•Data is very granular and can be segmented to very specific levels

•Key data segmentation is geographic (down to postcode) and sectoral (RES, SIC group, Yell classification code, Thompson directory classification code)

Benefits to Key StakeholdersMarketing

Build increased

penetration amongst

service users through

improved segmentation and targeting

Operations

Improve take-up of intensive

assists for Broker Team by increasing

lead generation

Executive

Meeting of Strategic

Priorities: To be recognized as the leader on regional business

intelligence and playing a vital role in informing business

support policy making

Cluster Orgs.

Make definitive pronouncements

about the effectiveness of BLNW services delivered to the NW Business Community including

Membership & Cluster Orgs,

Local Councils, Politicians &

Opinion Leaders

“Advanced Customer

Segmentation”

“Vastly Improved

Lead Quality”

“Delivering Strategic

Priorities”

“Sharing of Key Data across the

Region”

NWDA

Provision of relevant and up-to-date

information on emerging business

trends allowing the NWDA to

service requests from Government,

Political Parties & Lobbying

Orgs

“One Version of the Truth”

The Business Support EnvironmentINTERNAL EXTERNAL

Data becoming more relevant for decision making bodies

Internal

Sector specialists and cluster management teams

First interaction with third party data consumers and political oganisations

Internal

Geographically dispersed bodies require data to confirm Business support activities or to quantify the impact of future plans and policies

Business Support Community Partners look to BLNW for Data & Analysis as their first point of call

Sector

Dependency building

Internal

Local hierarchy of business support functions demand input to decision making and assessment of economic impact.

Sector Geography

Allows Business Support Community Partners to

Engage with Decision Makers on an Evidence-Based Basis

The User Base is Being Significantly Widened

Internal

Demand for joined up information sources and “one version of the truth” among all business support organisations.

Tie together regional strategy and delivery with a system of quantifiable evidence based results

The BPI (“Business Performance Index”: A Consolidation of Business Intelligence

Sector Geography Local Govt.

The Response to companies in the North West

adversely affected by the current economic downturn

The BPI: Identifying High Risk Businesses Risk Category Description

Maximum risk High value of unsatisfied CCJs, accounts overdue, start-up business with adverse data, proprietor with adverse data or maiden accounts show loss

High risk Large company with weak balance sheet, medium sized firm with very weak balance sheet, combination of above average risk features, start-up with adverse trading

Above average

Large company with very weak balance sheet, medium to small firms with (high levels of credit search, payment difficulty, weak balance sheets), start-up firm without adverse information

The BPI Portal: The Hub of the Action for Response Framework

• Experian/BLNW – Business Performance Index Structured Intelligence that can be immediately disseminated to partners

• Business Link to provide region-wide data-pool and reporting at Regional, Sub-regional and Local levels

CHAMBERS OF COMMERCE

SUB-REGIONAL PARTNERS

LOCAL AUTHORITIES

CLUSTERS & TRADE

ASSOCIATIONS NWDA

BUSINESS LINK NW

TUC / UNIONS

GOVERNMENT OFFICE NW

JOB CENTRE PLUS

HR1 to BERR

BUSINESS LINK DATA WAREHOUSE

RECORD BY COMPANYCompany Name

Registered NumberCompany Address

Local Authority & WardSector

Turnover & GVA EstimateNo. of Perm employees

No. of Jobs at Risk

>20 Redundancies within 90 days

Figure 1 Data Capture

ESTABLISH RAPID RESPONSE TEAM

DEVELOP STRATEGY/POLICY FOR SUPPORTING COMPANIES IN CRISIS

COMMUNICATE STRATEGY/POLICY TO PARTNERS (JCP, LSC, BLNW, TRADE

ASSOCIATIONS) & INTERNAL PARTNERS

The Action for Response Hub

The Power of the BPI: Project Rapier – Liverpool Vision’s Objective of Spending £10M to Save 40 Businesses specifically

in the Retail Sector by End Q1 2009

• How do you Identify a……………………..

Liverpool (13,704)

Employs 50 or more (207)

Central Ward (66)

In Retail Sector (4)

Deteriorating Payment Profile (1)

•…Company that is at least of Above Average Risk

•Which is based in Liverpool

•Which Employs 50 or more Employees at Site

•Specifically in the Central Ward

•Which is in the Retail Sector

•Whose payment profile is deteriorating

This information is based on data provided by Experian. The data has been subject to further analysis by Business Link North West.  

£729.71 £48,309.18 £151,515.15

£2.5M £10M

And that Business was?• Demonstrates that the

Liverpool Vision’s approach needs revising

• Also demonstrates that coordinated action by Local Authorities has the ability to provide financial assistance to some of the big High Street Retail Chains if they so wished

• Does this suggest a return to the days of municipal administrations with Local Authorities maintaining part ownership of key civic businesses?

Data Driven Evidence-Based: BLNW Making an Impact

Decision Making Based on Intuition, Judgemental Opinion or Tradition

Data Driven Evidence-based Decision Making

Disjointed programmes and policy initiativesJoined-Up programmes based on highly focussed

targeted strategies to address identified need based on documented evidence

Budgetary decisions based on prior practice and historic priorities

Budget allocations to programmes based on data-informed needs

Spending allocations based on volume of voices of special interests and eligibility criteria of existing regimes

Spending allocations based on market failure gaps as indicated by the data

Generic reports to all stakeholders based on historic aggregate data inappropriate for policymaking at a a micro-

economic level

Detailed reporting on a range of indices to relevant stakeholders on a regularised basis - weekly,

fortnightly, monthly, quarterly, half yearly based on agreed service level agreements

Goal-setting by board members, administrators, project managers with special treatment given to pet projects and

initiatives or the current fads of the day.

Goal setting based on accurate estimates of the financial consequences of proposed policy options allowing for prioritisation thus helping to predict the

impact of policy options to stakeholders in a “winners and losers” format

Death by committee: Undue focus on ensuring that money is spent and that it is seen to be spent

Highly focussed report-back and monitoring forums which ensure that not only is money spent well but also that the impact of spending can be tracked and

measured