6 Tips to Choose the Best Structure for Your Data Team in 2024

Updated September 22nd, 2023

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Managers across various sectors are facing the common challenge of an efficient and effective distribution of tasks among their team members. To be truly data-driven, companies need to build three capabilities:

The right data
An effective model
A robust structure for your data team

Lacking a well-organized structure can lead to operational inefficiency and compromised results.

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The key often lies in having the right structure for your data team. In this article, we will understand what makes a compelling data team structure, its diverse architectures, and the roadmap to build one.

What is a data team?
Understanding the different structures of a data team
How to choose the right structure for your data team?
7 Steps to build a structure for your data team
10 Goals of an effective data team structure
Summing it all up
Structure of your data team: Related reads

What is a data team?

First things first: let us demystify the term “data team.” A data team isn’t just a group of smart people working with numbers. It’s a team that takes messy data and turns it into clear information that helps a business make decisions. Now, let’s dive into how such a team is organized and set up, as we explore the structure of a data team.

You’ve heard it before: We’re living in the age of data. However, it’s not just about having data; it’s about what you do with it. While many organizations amass colossal amounts of information daily, not all can boast of deriving actionable insights from it.

To know more about modern data teams check out the following article → Modern Data Team 101: A Roster of Diverse Talent

Understanding the different structures of a data team

The structure isn’t merely about hierarchy. It’s about assigning roles, crafting collaboration pathways, and ensuring that the data journey—from its collection to its final analysis—is seamless and efficient.

Essentially, the structure is the backbone, ensuring that the team operates like a well-oiled machine, making sure data doesn’t remain a latent asset but becomes a dynamic tool.

In this section, we will see different types of data team structures with their advantages and disadvantages. The different types of data team structures are:

Centralized structure
Decentralized structure
Hybrid structure
Center of Excellence (CoE) model

Now, let us look into them in more detail:

1. Centralized structure

Think of it as a heart, pumping life (in this case, data insights) to the entire organism (the organization). All data tasks are managed by this core team.

Advantages of a centralized structure:

Resource efficiency: Concentrates data expertise in one place, ensuring better resource utilization.
Standardized processes: Easy to maintain consistent data policies, tools, and methodologies.
Holistic view: Can provide a comprehensive view of organizational data due to centralized oversight.

Disadvantages of a centralized structure:

Potential bottlenecks: Can become a single point of failure when demand from multiple departments spikes.
Loss of context: The centralized team might not be closely aligned with specific departmental nuances or priorities.
Delayed deliveries: Requests from various departments might queue up, causing delays.

2. Decentralized structure

Here, multiple smaller teams are embedded within different departments. Each functions autonomously, catering to the unique data needs of that department.

Advantages of a decentralized structure:

Departmental alignment: Data professionals are closely aligned with departmental goals and priorities.
Faster turnaround: Dedicated resources mean fewer bottlenecks and quicker results.
Deep expertise: Teams develop deep expertise about their specific department’s data.

Disadvantages of a decentralized structure:

Inconsistencies: Different departments might develop their own methodologies, tools, or data standards.
Resource duplication: Duplication of roles and tools can lead to inefficiencies.
Limited collaboration: Reduced knowledge sharing and synergy across departments.

3. Hybrid structure

Marrying the centralized and decentralized structures, this approach leverages the strengths of both. A central team provides overarching guidance, while specialized sub-teams delve deep into department-specific data.

Advantages of a hybrid structure:

Flexibility: Offers a balance between centralized oversight and departmental alignment.
Standardization with specialization: Central teams ensure consistent standards, while embedded teams offer specialized insights.
Optimized resource use: Better distribution of resources across the organization.

Disadvantages of a hybrid structure:

Potential conflicts: There might be clashes between centralized and decentralized teams regarding priorities or methodologies.
Complex management: Requires a more nuanced management approach to handle both centralized and decentralized units.
Coordination overhead: Increased need for regular communication and collaboration.

4. Center of Excellence (CoE) model

This model aims to build a central repository of best practices, tools, and methodologies that individual teams across the organization can tap into.

Advantages of CoE model:

Knowledge sharing: Facilitates the sharing of best practices across the organization.
Skill development: Acts as a hub for training and upskilling data professionals.
Maintains standards: Ensures consistent data policies and methodologies.

Disadvantages of CoE model:

May not address immediate needs: The CoE might focus more on long-term initiatives rather than addressing immediate departmental needs.
Resource allocation: Requires dedicated resources to maintain the CoE, which might not always contribute directly to immediate business outcomes.
Possible overhead: If not managed well, the CoE can add bureaucratic layers without proportionate value addition.

Now we have a good foundation on what are the different structures available, let us now get into how to choose one that suits best for your goals.

How to choose the right structure for your data team?

Choosing the right structure for your data team is a strategic decision that involves considering various factors. The right structure can facilitate efficient workflows, seamless communication, and effective problem-solving.

Here’s a detailed guide on how to go about making this crucial decision:

Assess organizational needs
Evaluate resources
Define scope and complexity
Consider organizational culture
Review team structures
Make a decision and iterate

Let us understand each of them in detail:

1. Assess organizational needs

Business objectives: Clearly understand the business goals and how data can help achieve them. This will help you define the scope of the data team’s responsibilities.
Current data landscape: Analyze the existing data infrastructure, technology, and skill sets within the organization to identify gaps or redundancies.
Stakeholder requirements: Conduct interviews or surveys with various departments to gauge their data needs and priorities.

2. Evaluate resources

Budget: Consider the financial resources available for building and maintaining the data team.
Talent pool: Assess the availability of required skills both within and outside the organization.
Technology: Take stock of the available technology and tools that can facilitate the data team’s operations.

3. Define scope and complexity

Data volume and types: The amount and types of data you deal with (structured, unstructured, real-time, batch, etc.) can dictate the skills and resources you’ll need.
Project complexity: Some projects may require specialized data scientists, while others may need more data engineers or analysts.
Integration needs: Determine if the data team will need to work closely with other departments like marketing, sales, or finance.

4. Consider organizational culture

Collaboration vs. specialization: Some organizations prefer a collaborative approach, while others may need highly specialized roles.
Agility: If the company values agility and quick pivots, a more flexible and modular team structure may be beneficial.

5. Review team structures

Centralized vs. decentralized vs. matrix: Evaluate the pros and cons of each structure based on the above considerations.
Hybrid models: In some cases, a combination of different models may be the most effective.

6. Make a decision and iterate

Pilot phase: Initially, you may opt for a smaller team and scale as you fine-tune the structure.
Feedback loop: Create mechanisms for team members and stakeholders to provide feedback on the structure’s effectiveness.
Adjust and scale: Be prepared to adapt the team structure as business needs, technologies, or objectives evolve.

Key Takeaways

Alignment with business goals: The team structure should align with broader business objectives and the specific data needs identified.
Scalability: Choose a structure that can scale efficiently as the organization grows.
Flexibility: Given the rapidly evolving nature of data science and technology, opt for a structure that allows for adjustments and pivots.
Skill utilization: The structure should allow for optimal utilization of the varied skill sets within the team.

By systematically assessing your organization’s specific needs, available resources, and long-term objectives, you can choose a data team structure that not only fits your current situation but also can adapt to future challenges.

7 Steps to build a structure for your data team

Building a robust data team structure involves understanding the various roles within the team, their responsibilities, and how they interact with each other. Let’s delve into the key steps of structuring a formidable data team, which are:

Defining the core objectives of your data team
Roles and responsibilities
Collaboration and communication
Training and development
Tools and infrastructure
Governance and compliance
Scalability and flexibility

Now, let us look into each of the above steps in more detail:

1. Defining the core objectives of your data team

Before diving into the specific roles, it’s vital to define the primary objectives of your data team. Some common objectives include:

Data collection and integration
Data cleaning and validation
Advanced analytics and data modelling
Business intelligence and reporting
Machine learning and AI development

2. Roles and responsibilities

a. Data engineer responsibilities

Primarily involved in designing, constructing, installing, and maintaining large-scale processing systems and other infrastructure. They manage and optimize databases to allow for effective data retrieval and work to ensure data quality and accessibility.

b. Data scientist responsibilities

Data scientists use advanced computational techniques to analyze and interpret large amounts of data. Their main objective is to convert this data into insights and predictions that can benefit the business.

c. Data analyst responsibilities

While there might be some overlap with data scientists, analysts often focus on inspecting, cleansing, transforming, and modeling data to discover useful information, draw conclusions, and support decision-making.

d. Machine learning engineer responsibilities

ML engineers design, implement, and apply machine learning models to solve business problems. They also work on scaling and deploying models into a production environment.

e. Business intelligence (BI) developer responsibilities

Focuses on designing and developing visualizations, dashboards, and BI solutions to represent data findings in a clear and interactive manner.

f. Data steward/curator responsibilities

Manages the data assets of a company, ensuring data consistency, quality, and reliability. They may also be involved in metadata management and data lineage.

g. DataOps responsibilities

Works to improve data quality, streamline data pipelines, and optimize data operations by applying DevOps practices to data workflows.

3. Collaboration and communication

Cross-functional interaction: The data team shouldn’t operate in isolation. They should actively collaborate with other departments, such as marketing, sales, product development, and customer service, to ensure alignment and impact.
Regular team sync-ups: Frequent communication within the data team is crucial. Regular meetings can help in tracking progress, addressing challenges, and brainstorming new ideas.

4. Training and development

Continuous learning is paramount in the ever-evolving data landscape. Invest in training sessions, workshops, and courses for your team. Encourage them to stay updated with the latest tools, techniques, and best practices.

5. Tools and infrastructure

Equip your team with the right tools. Depending on your organization’s needs, this might include data warehouses, ETL tools, analytics platforms, visualization software, and machine learning libraries.

6. Governance and compliance

Establish clear protocols for data governance, data privacy, security, and compliance. This not only protects your company from potential legal implications but also ensures that your customers’ trust is never compromised.

7. Scalability and flexibility

As your business grows, so will your data needs. Build your data team with scalability in mind. Ensure there’s room for growth and flexibility to adapt to new challenges and requirements.

10 Goals of an effective data team structure

When constructing an optimal data team structure, the goal isn’t just to throw a group of data scientists together and expect magic. The effectiveness of the team is fundamentally underpinned by its structure. An effective data team structure is intended to:

Ensure seamless data management
Promote specialization
Enhance collaboration and communication
Drive business decisions
Support scalability and growth
Ensure compliance and security
Facilitate continuous learning and training
Optimize resource allocation
Encourage accountability
Enhance value extraction from data

Now, let us look into each of the above goals briefly:

1. Ensure seamless data management

At the foundation of every data operation is the need for reliable data infrastructure and management. An organized team structure guarantees that there’s a dedicated subset of professionals ensuring data is properly collected, stored, cleaned, and prepared for analysis.

2. Promote specialization

Data science is a broad field, with individuals often specializing in areas such as machine learning, deep learning, data engineering, or business analytics. A well-defined structure allows for specialization, ensuring that each area has dedicated experts driving innovation and value.

3. Enhance collaboration and communication

An organized team promotes better collaboration between different roles. For instance, data engineers and data scientists need to communicate frequently to ensure that data pipelines are optimized for analysis.

4. Drive business decisions

The ultimate aim of any data team is to provide insights that can inform and guide business decisions. A coherent team structure will ensure there’s a clear path from data collection, to analysis, to actionable insight.

5. Support scalability and growth

As the organization grows, so will its data needs. A well-laid-out structure ensures that as the team expands, new members can be onboarded smoothly without disrupting existing workflows.

6. Ensure compliance and security

With increasing data regulations globally, it’s imperative that organizations manage their data in a compliant manner. A well-structured team will have roles dedicated to ensuring that data is handled, processed, and stored in ways that meet all necessary regulatory standards.

7. Facilitate continuous learning and training

The field of data science is ever-evolving. Having a team structure that supports continuous training and up-skilling is crucial. This ensures that the team stays updated with the latest tools, methodologies, and best practices.

8. Optimize resource allocation

An efficient team structure allows managers and leaders to easily identify where resources are needed most and allocate them accordingly. Whether it’s more hands for data engineering tasks or advanced expertise for a complex machine learning project, a clear structure provides visibility into these needs.

9. Encourage accountability

When roles and responsibilities are clearly defined, there’s a greater sense of accountability. Team members understand their individual and collective responsibilities, ensuring tasks are completed timely and efficiently.

10. Enhance value extraction from data

Above all, an effective team structure ensures that the organization extracts maximum value from its data. From identifying new business opportunities to optimizing existing operations, the team is primed to make the most of the data at its disposal.

Summing it all up

Effective use of data is hinged on the structure and efficiency of data teams. These teams aren’t just groups of techies but are strategic ensembles that turn raw data into valuable insights.

From centralized to decentralized models, the structure chosen must foster specialization, ensure seamless management, and drive business decisions.

But beyond structure, the team’s goals should aim for growth scalability, maintain compliance, and prioritize continuous learning.

Examples from successful organizations show diverse team structures, each tailored to specific needs. In essence, a well-structured data team is the backbone of maximizing value from data in any organization.