As organizations continue to collect more data from an ever-expanding amount of sources, the need for proper data management is critical to ensure future success.
However, according to a study by HFS Research, 75 percent of business executives do not have a high-level of trust in their data and 70 percent do not consider their data architecture to be “world class”.
This lack of trust comes despite 89 percent of executives surveyed saying a high level of data quality was critical for success. This was considered even more valuable than management acumen, which 85 percent thought was a critical factor.
Almost all organizations use data in some regard to either optimize experiences, analyze or provide insights for improvement. The introduction of artificial intelligence and deep learning technologies further emphasizes the need for high quality data.
80 percent of executives believe these disruptive technologies will transform the competitive landscape, leading to high amounts of investment in skills and tools over the next five years.
According to HFS Research, 70 percent of executive see data as a tool for survival and top-line growth. Executives also see data as critical for M&A and divestiture activity. 72 percent of executives see data as an important tool to improve decision making, and 69 percent believe it will reduce overall costs.
“The cost of bad data is staggering, but most people don’t personalize it,” said CEO of Syniti, Kevin Campbell, to HFS Research. “If you talk to a C-level executive, they’ll say, ‘I have an inventory problem,’ or ‘My supply chain has issues.’ After thousands of projects, we know that almost 90% of the time it’s caused by a data problem. Either the right data isn’t properly accessible, or the data’s not clean enough for what needs to be done.”
Only 23 percent of organizations have a consistent global data management strategy in place at scale across the enterprise. A majority, 46 percent, are currently implementing this policy in key areas, while the rest are either piloting or planning to invest in the future.
This may be part of the reason why executives have a hard time trusting data, as some teams and parts of the organization may be much further ahead or behind in data management, governance and understanding.
Accordingly, 25 percent of organizations have low or moderate levels of trust in data. A majority believe that 61 to 80 percent of their data is ‘good enough’, while 38 percent of organizations aspire to have data that is 81 to 99 percent high quality.
In terms of governance, there are many schools of thought as to who should be in control of strategy and execution. 44 percent of respondents believe IT should be responsible for strategy and 34 percent believe the department should be in control of execution, the highest percentage in both fields. A separate centralized data team was considered by 29 percent of respondents to be responsible for strategy and 27 percent for execution.
Good data quality could be critical to several parts of an organization’s future success. 12 percent of executives think that good data could improve an organization’s valuation by more than 10 percent, while 34 percent think it could improve revenue by 5 to 10 percent.