Published on the 26/05/2020 | Written by Heather Wright
Data-driven companies 58 percent more likely to beat revenue goals…
It’s an often heard refrain: Data is the new gold. But raw, unstructured data by itself is little more than a deposit – just like gold it needs work, making it accessible and understandable and ensuring it’s clean and accurate, to provide its true value. The payoff, however, can be big, with a new report finding that data-driven companies are 58 percent more likely to beat revenue goals.
The Business Impact of Data Intelligent Management report from Forrester Consulting and data intelligence company Collibra, found ‘proven business success’ for data intelligent organisations, defined as those who agree they have the ability to connect the right data, insights and algorithms so people can drive business value through data.
As well as being 58 percent more likely to have said they exceeded revenue goals last year, the data-savvy businesses were 162 percent more likely to say they had significantly overperformed on revenue goals.
“Data-savvy businesses were 162 percent more likely to say they had significantly overperformed on revenue goals.”
There was also an eight percent advantage in improving customer trust and a 173 percent advantage over non-data intelligent organisations in better compliance with regulations and requirements.
While the survey was conducted in January – before the effects of Covid-19 started hitting home – Forrester says the pandemic illustrates how risk mitigation strategies can arguably be as important, if not more so, than growth objectives in moments of economic uncertainty.
“Here too, data intelligent organisations show they are more adept at key areas like addressing privacy and risk exposure, simplifying organisational and operational hierarchies, complying with regulations and requirements and improving customer trust.”
The findings echo those of ESG and Splunk, whose recent What is Your Data Really Worth report found that businesses which contextualise data into their business and lead with analytics grew their annual revenue by 5.3 percent, with 97 percent able to either meet or exceed customer retention targets.
The Forrester survey covered more than 900 global business analysts, with 12 percent from Australia – and Australian respondents were among the leaders when it came to not only understanding the value of data, but taking action.
Australian respondents were most likely to routinely or always leverage data for decisions at 66 percent well ahead of the global averages where 84 percent of business analysts agreed it was very important or critical to put data at the centre of crucial business decisions and strategies, but 43 percent admitted that their companies fail to always or even routinely use data to guide business decisions.
Australian respondents were also ahead of the global average when it comes to ramping up investment in data management tools over the next two years with 72 percent of Australia planning increased investment, versus the global average of 64 percent.
The report lays out seven ‘pillars of data management’:
Discover: For data to be transformational, relevant stakeholders must be able to find it as efficiently as possible
Access: To leverage insights relevant stakeholders must be able to get to and work with the data they need
Understand: Data users have to easily understand the data they’re accessing and using
Collaborate: Data users must break down silos and be empowered to work cross-functionally
Share: It must be easy to contribute and publish data and insights to the organisation
Trust: Stakeholders must know the data is clean and accurate
Execute: Organisations must leverage data effectively to drive business outcomes
“To lead with data, companies need to advance how they discover, organise, collaborate with, and execute on the data they have,” says Felix Van de Maele, Collibra co-founder and CEO.
As to those companies without a data management strategy, Forrester says their analysts are often left to complete tasks that take away from their ability to perform actual analysis and provide effective value.
“This is a resounding issues for less data-mature organisations, which are 55 percent less likely to say their data management strategies positively contributed to optimal business decisions for their organisations.
“On the other hand, data intelligent organisations are able to progressively focus on improving their abilities to execute analysis and drive business outcome, while less mature organisations are still trying to improve trust in their data.
Adds Van de Maele: “Companies must optimise how data analysts spend their time and automate rote tasks with data management technology. By freeing analysts up to spend more time on value-added tasks, organisations can decrease time to insight and accelerate trusted business outcomes.”