Data is driving so many important decisions in our lives; from the way societies function to the way businesses run. Some even call it the ‘new oil’. But what happens when data is misleading and points decision-making in the wrong direction?
First of all, it’s expensive, back in 2016, a study by IBM concluded that bad data cost the US $3.1tn. According to 95% of respondents recently surveyed by Experian, the credit reporting agency, bad data is also negatively affecting customer experience.
Experian’s Global Data Management report, which surveyed 1,000 data practitioners from organisations around the world, also found that most respondents are frustrated with how data is being managed too, 75% think responsibility for data should lie across multiple departments, with occasional help from IT, only 13% are currently doing it.
Incorrect ownership (69%), lack of trust in data (49%) and information overload (65%) are the three most common factors preventing businesses from using data to reaching their strategic goals.
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“From the research, we are seeing a broad range of business stakeholders looking for more control over their data, as many struggle to access valuable information and develop trust in it,” Mike Kilander, Global Managing Director, Data Quality at Experian. “We see year after year that despite ambitions, many businesses fail to take full advantage of the opportunity that data can provide because current infrastructure and management practices are not set-up to handle today’s digital consumer.”
“However, we are seeing more organisations establishing stronger data leadership steered by a Chief Data Officer (CDO). New leadership, empowered by business-user focused technology, can deliver the strategic direction to ensure the right people have access to trusted data and deliver the best outcomes for the business.”
Changing data ownership
According to the study, seven in 10 businesses struggle to unlock data’s true potential because of a lack of control. The majority of respondents thought this is to do with how data is being managed — 84% say data is processed by IT who have too many other priorities to give data quality or analytics the full attention it needs. As a result, 56% of companies say these teams don’t have an understanding of the organisation’s data management needs.
As many organisations look to potentially hiring a Chief Data Officer, Experian warned how it is key to implement the right strategies to reinforce both data compliance and security, along with allowing quick access to data for immediate business use.
Current processes conflict with how organisations want to see data managed. Three-quarters of respondents want responsibility for data quality to lie within the business, meaning those who use information are responsible for its upkeep.
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Creating data confidence
Trust in data was viewed as a major challenge for 33% of organisations — 29% of them believe their customer and prospect data is inaccurate. A further one in three report data being difficult to leverage because it is incomplete (38%) or not accessible through a single customer view (36%).
The main reason for mistrust in data is human error: 50% think bad data quality is down to it being inputted incorrectly. Other reasons for the lack of confidence in data is due to information being spread out across multiple sources (39%) and having an inadequate data strategy (30%).
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Realising opportunities
Despite these issues, 99% of companies will still use data to gain a competitive advantage.
From improving customer experience (54%) and better insights for decision-making (51%) to more efficient business practices (52%), firms acknowledge the benefit of using data on their bottom line.
According to the survey, this data-focused strategy is to do with survival – 89% say it is essential for succeeding in the digital market place. However, the main reason for making data more reliable is improving customer experience.
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