What are the three major issues that data-driven organizations are facing?

Last Update Time: 2021-04-15 10:43:31

Organizations view data as a source of more valuable insights and key competitive advantages, and in some cases as a strategic asset. Unfortunately, although most organizations have large amounts of data, they lack more meaningful insights. Overall, despite investing in data and analytics, many companies do not consider themselves to be data-driven organizations. But why do you see this disconnect? Why do organizations feel this way? There are three main reasons: trust in data, data debt, and skill gaps.


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Trust in data

Research by Experian, a research institute, found that many organizations are working hard to manage data, and 85% of them believe that data is one of the most valuable assets of the organization. It is generally believed that having accurate and credible data will help improve customer experience, better decision-making, more innovation and other competitive advantages, as well as more effective business practices.

However, despite these benefits, you can still see that the level of organizational data quality has not improved. In the past few years, the amount of inaccurate data has been very high. On average, 28% of customer or prospect data is inaccurate to some extent.

This degree of inaccuracy will affect the organization's operations in many ways and will face problems such as waste of resources and inability to rely on analysis. But it also affects the organization's main plan. Bad data can damage the customer experience and the success of new data drivers.

The extent of bad data has become so common that only 50% of organizations believe that the current state of their customer relationship management (CRM) or enterprise resource planning (ERP) data is clean and cannot be fully utilized.

Manage data debt

Becoming a data-driven organization can bring many benefits, but many organizations are still trying to use data to achieve a competitive advantage. Despite significant investments in data projects such as data analysis, artificial intelligence, and machine learning, organizations have not seen more significant results.

Organizations generally understand the benefits of data, but they often also carry a large amount of data debt, which is usually the cumulative cost associated with poor management of data assets in the organization, a bit like technical debt.

Data debt is a challenge for 78% of organizations. Many people say they lack the necessary trust in data, which hinders the return on investment of any new data management plan or many business plans that rely on data-driven insights. Although many stakeholders consider data debt to be a challenge, 59% of organizations say it is difficult to know where to start to resolve data debt. The good news is that 64% of organizations say they have a plan to solve this problem.

Do you have the skills to analyze data?

The study also shows that because many organizations lack the skills and resources necessary to make the most of the data they have, there is a data skills gap.

This not only means that data professionals such as data analysts, chief data officers (CDOs), and data scientists are in short supply, but employees in organizations generally lack an understanding of broader business data. The desire for these skills is due to a lack of data knowledge and skills that are affecting the value an organization derives from data and informed planning.

84% of organizations view data literacy as having the ability to read, process, analyze, and form arguments with data. This is a core skill that employees must possess in the next five years. For this reason, more and more organizations will discuss how to make data more widely used by people other than data practitioners, but only a few employees in the organization really understand the data, which is a difficult problem.

To solve this problem, 30% of organizations have formulated a formal data literacy plan, while 36% of organizations said they plan to establish a data literacy plan.

Key points

In today's economic situation, organizations want and need data to drive. Data has become one of the most valuable assets an organization has, so people strongly hope to make the most of this asset.

The challenge is that most organizations cannot use the power of their data. Unfortunately, people ’s severe distrust of information, rising levels of data debt, and a shortage of data skills all come together, making data insights more difficult to achieve. Fortunately, many organizations are recognizing these challenges and are beginning to drive change.

It is important to remember that change will not happen overnight. Like anything else, creating a project that attempts to solve various situations usually stalls without producing the expected benefits. The good news is that with data, you can find a chance to win quickly, which will have a major impact on the organization's operations.

Stakeholders do not have to master all data or achieve 100% accuracy to create value. They need to find the most important information and start small improvements with small investments. Then, these victories will arouse people's interest and make better improvements.

It ’s important to remember that there is no one-size-fits-all method for achieving an organization ’s data goals. Understanding data in depth is a job that takes a lot of time and effort. However, as talent and investment increase, this dream can begin to become a reality.

 

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