What is a data-driven organization? Are all companies not data driven, to some extent? Why are we now labelling this as something new? Is it because we have now labeled data as a precious substance?
When it comes to Data Science, there’s a lot of confusion.
Everyone is jumping on the AI bandwagon. Companies want algorithms. They may not understand why but they are certainly afraid of missing out on the latest tech trend.
AI is something of a misnomer and companies often just need some business intelligence, those data analysis strategies and technologies to extract insights from their corporate information.
In other words, today’s companies need information to optimize their business. That seems like a simple request, but is, in reality, a continuous challenge.
Let’s take a moment to understand the data. Data is regularly called the new corporate currency or the new corporate oil.
In our opinion, this latter analogy is apt because, just like crude oil, data is often hidden and highly valuable. Actually, the situation is often worse than this: we don’t even know how this data is structured, we don’t know where it is, how it’s connected and what the real quality of our data is.
Try asking your teams this simple question: do we have a data model at our company? Or do we know how our data is structured? Even better – is our data well described? So many individuals labor over such questions, trying to identify the right path to become a data-driven organization with grand visions and intuitive technologies. But first, you must get to grips with your data.
Let’s look at an example. You may remember mail-order companies. One commendable quality of these companies was that they continuously invested in maintaining a high-quality customer base. When these businesses were sold, their value was based on the number of customer records. This is because the buyer was, effectively, paying for a valuable customer database.
Thanks to advancing digitization, things have changed. Data has moved away from physical, paper-based repositories and into online, cloud-based databases. To truly be a data-driven company, you must now understand that an individual customer record requires investment to acquire and to maintain, and that value is only created by accurately capturing your relationship with those customers.
In other words, you must start treating your data as a critical company asset. This provides a sound basis for your decision making with regards to your AI, BI and Big Data technology investments.
To become data driven, the textbooks often advise companies to ‘create a data culture’. While that’s a very commendable recommendation, cultures do not change overnight. They may not even change in a couple of years.
7 ADVANTAGES OF A DATADRIVEN ORGANIZATION
As you become more data-driven, you will realize many benefits for your business. These benefits provide you with a competitive advantage, having a positive impact on your bottom line. In fact, research from Forbes reveals datadriven organizations realize 20% to 30% improvements in their EBITDA. Advantages include: