Why Is Actionable Data The Most Critical Factor In Digital Transformation?

Data-powered enterprises massively outperform their peers on multiple financial measures and digital transformation, realising 70% more revenue per employee and also driving 22% more profits. While using data and analytics is becoming a requirement for success, less than 40% of organisations use data-driven insights in order to drive business value and innovation.

As digital technologies radically reshape industry after industry, many organisations are pursuing large-scale digital transformation efforts in order to seize the benefits of these trends or simply to keep up with competitors.

Many organisations have undertaken digital transformation efforts in the past five years however success in these transformations is proving to be vague. While prior research has found that fewer than one-third of organisational digital transformations succeed at upgrading a company’s performance and sustaining those gains, the latest results find that the success rate of digital transformations is even lower.

What Is Digital Transformation?

Digital transformation is an evolution – in other words, an ongoing innovative cycle. Very importantly, digital transformation doesn’t simply mean technology change. Technology as well as data are certainly key enablers however true transformation requires a more holistic appreciation of risks, policies, processes and – critically – people and teams.

As digital transformation is a continuing process, evolving over time, it necessitates an effective overarching change approach in order to manage, optimise and continually tailor efforts in order to realise the benefits of digital approaches.

Only One In Six Organisations Can Be Categorised As Data Masters

Another term for data masters is data-powered organisations. This is based on several factors of data mastery, including the required data tools and technologies needed to use and leverage data as well as the suitable data vision, governance, skills as well as culture.

Organizations are making massive headway on data-driven decision making as well as actioning. Research shows that 50% of organisations worldwide put data at the heart of decision-making. At a country and sector level, data-driven decision-making is more prominent in the United States (77%), Germany (69%) as well as the United Kingdom (69%). In terms of sectors, banking (65%) as well as insurance (55%) are far more data driven.

While progress has been made, the majority (51%) of the time businesses still use historical data (which is a reactive decision-making approach). This means that they lose out on a competitive advantage. Only 23% of the time do they make use of predictive approaches, while 18% of the time they make use of prescriptive approaches and use an autonomous or self-optimising approach only 8% of the time.

Data masters enjoy between a 30 to 90% advantage in metrics across:

• Customer engagement,
• Top-line advantages,
• Operational efficacy, as well as
• Cost savings.

Major disparities exist between business executives’ trust of data as well as the technical executives’ perception of this trust: just 20% of business executives have faith in the data while 62% of technical executives believe that their business users do so.

Of the organisations where data is not trusted, research found that only 24% were able to monetise their data assets when compared to 83% where it is trusted. Poor data quality is a massive contributor to this mistrust: only 27% of business executives are happy with their data quality while 54% of technical executives are of the opinion that their business users are happy with the quality.

Get in touch with the Digital School of Marketing

Are you eager to learn more about digital transformation and how to implement this in your business? If you are then you need to do our Digital Transformation Course. Follow this link to find out more.