In today’s increasingly digital world, data is the new gold. Data is changing the business world, providing organisations with the opportunity to use data and analytics to become less process oriented and more data-driven when it comes to their strategy and decision making. While the use of data and analytics techniques is increasingly critical, their effectiveness depends on a strong foundation of improved planning, people, and optimised processes and systems.
A company which is data-driven isn’t simply one that collects data but instead uses it to make informed and insightful business decisions based on facts rather than opinions. Analysis by the UK government predicts that data will benefit the UK economy by up to £241 billion between 2015 and 2020, making it imperative that businesses incorporate innovative and effective ways to embrace data in order to to optimise their business, drive growth, and foster a competitive advantage
Define and plan your strategy
Becoming data driven isn’t just about introducing new processes and technology but it includes an overhaul of your entire business strategy. Creating a new vision about the direction your firm is taking is the starting point and will allow the business to work towards a common goal and to achieve total internal alignment around that goal. Firms would also do well to remember that becoming data driven isn’t the end but rather a means to an end: it will allow you to solve problems and make better business decisions overall.
Building or refining a data strategy can be a lot of work and a roadmap will help to identify the people, processes, data and expenditures required for a data-driven transformation while also ensuring all stakeholders are on the same page. For firms of all sizes, a phased approach that emphasises goals and milestones will help to keep your business organised and on track while allowing you to correct errors and be agile throughout the process.
Create a cultural change
One of the most important aspects of becoming data-driven is that it requires a disciplined shift in the mind-set of all employees to help consistently drive decision making and performance. Starting at the top, employees need to embrace the new approach with a focus on maintaining the integrity and quality of the company’s data.
Instigating training at all levels will also help to ensure employees know what is expected of them and that they’re up to date on changing procedures and guidelines. This is particularly important as we head into a year that is rife with new regulations – including the Markets in Financial Instruments Directive (MiFID II), the Second Payment Services Directive (PSD2) and the General Data Protection Regulation (GDPR) – that will greatly impact how firms manage data. To ensure that your company doesn’t fall foul to these regulations, implement training to ensure that all staff are aware of their implications and impact on the wider business.
Another way to guarantee that data is at the forefront of your culture is to hire individuals who can manage business intelligence functions within your organisation. Data-driven recruitment will help to ensure you’re bringing on board individuals who will deliver innovative solutions and will help to meet your business objectives.
Internal fragmentation can often be a major barrier for companies who seek to become data driven. Instead, the new procedures and systems should be accessible and used widely by all employees to create harmonisation across departments.
Rather than limiting cross-functional communications, mature companies encourage information sharing and collaboration to identify problems or to gain a new type of competitive edge. Overall, this will provide greater transparency, enable tighter controls and allow for flexible reporting.
With such an abundance of customer data readily available, data is often fragmented, with different components stored in a variety of locations and across multiple departments, increasing the possibility that your company will face security threats.
Through cleaning and analysing this data, businesses will be able to improve their existing processes, reduce storage costs and gain a competitive edge over their competitors. Incorporating improved data storage systems can help to reveal patterns and trends in your business, enabling you to innovate and even launch new products. If your firm does not have the capabilities to manage data storage in-house, smaller and medium sized firms may consider using a third party system.
Data security should also be a top priority for firms who are engaged in data-centric processes, yet according to KPMG’s government’s Cyber Governance Health Check 2017, more than two thirds (68 per cent) of FTSE 350 boards have not received any training to deal with a cyber incident, showing just how unprepared many of the world’s largest firms currently are for a deadline that is quickly approaching.
Without strict data security guidelines, your business will be vulnerable to security threats, data loss and breaches, all of which can lead to brand and reputational damage as well as regulatory fines. Incorporating higher levels of security will help to ensure that customers have trust and loyalty in your brand and maintain brand confidence among the broader public.
Matt Smith is the CEO of SteelEye