Why do you need a Data Strategy now more than ever?
With increasing globalization and technology developments spurring modern economics, Data Strategy has been vital in identifying and understanding customers and making proper decisions to promote growth in your business.
In addition, the plan is critical in defining your target clients and discovering potential market segments to make your business profitable. Let's look at some specific reasons why you need a data strategy more than ever.
Ensuring Data Security
Data strategy enables companies to design efficient data management activities to enhance the security of information.
Data defense activities such as using analytics to detect and limit fraud, ensuring compliance regulations governing privacy and the integrity of financial reports, and building systems to prevent theft are critical in safeguarding data.
Therefore, data defense also improves data integrity. This is accomplished through a company's internal systems by identifying, controlling, and managing data sources. This includes critical customer and supplier information.
On the other hand, data offense aims at increasing customer satisfaction, revenue, and profitability. It supports activities that generate customer data analysis and modeling to enhance managerial decision-making. They are essential in sales and marketing to promote business growth.
Data strategy enhances intelligent use of data, protects it from internal redundancies and access by unauthorized individuals leading to losses.
A recent survey shows that companies affected by data breaches in the United States lost $8.64 million in 2020, up from the $8.19 million in 2019. According to the survey, the global average cost per data breach was $3.86 million.
The strategy is also critical in anticipating and mitigating risks that can compromise the company data and damage its reputation. It is also essential in applying advanced surveillance methods and cognitive-enabled controls to protect data.
Improving Decision Making
Data strategy allows Chief Data Officers (CDOs) to arrange data properly and gain more insights to make data-driven business decisions. This method allows your team to get refined data immediately and make the right choices to improve performance and profitability. In addition, from the data you can understand new market trends and redefine your services to satisfy your customer needs.
Most successful companies are making the high percentage decisions based on data. However, even with the emergence of data strategy and management to promote growth, most are still lagging in adopting digital developments.
Data strategies enable innovation and value creation in line with current and future market trends which support long-term business goals. Furthermore, experts say that most companies fail today due to an inadequate data strategy to support accurate decision-making.
The system also supports better data management, analytics, and the skills required to assist executive decision-making to improving financial performance.
Identifying and Exploiting New Business Opportunities
Data strategy enhances the effective collection and provision of essential data about the new market trends and existing gaps.
Consumer segmentation data, including gender, age, residence, level of education, occupation, income level, and purchasing motivations, can help establish the number of target customers in an area. For example, there could be a potential gurney business opportunity in a place where a significant number of the disabled, the elderly, and those living with chronic illnesses exist.
Data analysis of the existing competition will also help your company evaluate opportunities based on the available brands, the proposition value, and the competitive advantage. For example, lowering the cost of products and services to increase sales.
Data analytics enhances the efficiency of companies by improving the supply chain. It promotes effective collaboration and timely transfer of information to the necessary departments for quick decision-making.
Any delay that happens due to data hitches can lead to loss of business opportunities. Ideally, data allows for determining demand in the market and making proper plans to fulfill them in time. Flexible data is easy to transform and interpret appropriately to meet specific business targets. The information architecture helps in converting data into valuable information to support growth.
For example, data architecture can transform raw daily advertising and sales data into marketing dashboards for integration and analysis. This will showcase the relationships between ad spend and sales by channel and region. Fresh data on supply costs, customer retention rates, and sales figures are not valuable until it is integrated with other data and transformed into information that can guide decision-making.
So, the company data architecture describes how data is collected, stored, altered, distributed, and consumed to achieve the set goals. It regulates the process of converting data into useful information.
The information architecture involves a single source of truth (SSOT) and multiple versions of the truth (MVOTs), where the SSOT works at the data level. At the same time, the MVOTs support the management of information. Successful companies employ both aspects.
Data also improves the customer experience through real-time reporting enhancing customer support and increasing satisfaction. Real-time reporting allows organizations to understand customers' concerns and address them promptly to improve the experience and increase sales.
Great data also helps create a mechanism for evaluating the performance of employees and discussing the best ways to improve their productivity where necessary.
As the world develops technologically, companies need to adopt new data strategies to protect and use their data. Thus, a proper data strategy ensures efficient use of data. It will achieve organizational objective by creating effective methods and practices to manage shared information across the enterprise. Therefore, companies that have not yet established a robust data strategy and management need to adopt them as soon as possible. This will ensure you are keeping up with evolving business operations.
How Data Ideology Accelerates Your Data Strategy Initiative
At Data Ideology, we leverage our proven SWIFT Framework™ to quickly deliver a cross-platform data & analytics strategy. This methodology ensures you have accounted for all the pieces of the puzzle to unlock the drivers for success. Now, your organization will start with a strong data foundation to build on into the future.
Data Ideology's Data and Analytics Quickstart is designed to provide a fast time to value, lower risk, and reduce complexity. Organizations can streamline the process and minimize time to insights with a defined framework, scope, predictable timeline, and fixed up‐front costs.
Our process is built for speed and simplicity. Data Ideology's Data & Analytics Strategy Quickstart will deliver a robust data strategy, future state data architecture, and in weeks - not months! Reach out soon and let’s schedule a short discovery session.
Written by Mike Sargo
Co-Founder & Chief Data and Analytics Officer at Data Ideology
Mike Sargo is Chief Data and Analytics Officer and Co-Founder of Data Ideology with over 18 years of experience leading, architecting, implementing, and delivering enterprise analytics, business intelligence, and enterprise data management solutions.