From finance and accounting to manufacturing, businesses large and small now own and have access to a wealth of valuable data – about their business, their markets and their customers.
Bringing this data together and using advanced analytics and AI to process it gives them the power to adopt a data-driven approach to business decisions.
Data-driven businesses glean insights by using reliable, historical data. They create a shared set of metrics and a clear understanding of where to improve processes, by bringing together disparate data sources from across the company.
They can trust that the data they’re seeing is high quality and accurate. It’s also democratic; the data is available at every level within a business and is used to inform, guide and support every single decision a business makes.
While this might sound like some kind of ‘data nirvana’, our recent research, AI in Business: A Report, shows that around 16% of large businesses have reached this ideal data system: data from different sources is systematically brought together and AI and advanced analytics are used to power insight, fuel collaboration and drive decisions.
Achieving a data-first approach is a real challenge for businesses
But there are many businesses still grappling with this data-first approach. The barriers to becoming a data-driven business are numerous and include cost, lack of expertise, legacy systems and lack of technology. Yet one crucial and often overlooked obstacle is culture.
Factors here might include getting senior level buy-in, achieving user adoption or increasingly importantly having an open and collaborative approach to data within the business.
Far from bringing data and teams together, in many businesses the explosion of data has fuelled the creation of departmental data empires or chiefdoms. Our research shows that senior executives are spending nearly a day each month collecting their own, closely guarded data ahead of key meetings – the very opposite of the democratisation of data.
Just 6% are using automated technology to support quick and consistent data collation.
If you extrapolate the number of hours (6.9) that on average a director in a UK business spends collating and preparing their own data for board meetings by the number of directors in the UK, then an estimated 167 million hours a year are being wasted on data gathering.
And the larger the company, the greater the amount of time senior executives spend preparing data, and the more likely data silos are to exist. Directors in organisations employing over 250 people devote nearly 12 hours each month to gathering, preparing and presenting data for internal meetings.
Lack of automation leads to data silos
Worryingly only 3% of large organisations automate the data gathering and collation process to provide a quick, comparable and unbiased view of their worlds through data.
Apart from the sheer number of hours wasted, this lack of automation, restricted transparency and a tendency to hoard useful information inhibits a true data-driven approach to business decision making.
The danger is that instead of gaining a true, single view of their business powered by automated technology, business leaders are seeing the information departmental heads want to share in the way they want to share it. More powerful, single-view business data exists, but it’s in heavily protected silos.
The upshot is that these businesses are simply unable to make better informed, data-driven decisions, and gain competitive advantage.
Essential steps to getting a better view of your business
So what needs to change to foster collaboration and help break down these mini data empires?
It’s imperative to start working towards establishing good data foundations. Ensure that data – wherever it is – is of good quality, reliable and is being collected systematically and accurately across the business. Ensure that it’s ‘shareable’ and that there are consistent and comparable datasets across the business to create a solid basis for the decision-making process
From this rock solid foundation you can begin to use improved systems and technology to automate data collection and standardise the reporting process across departments and again, ensure it’s consistent.
And last but not least, in an age of agility and rapid change, business leaders and departmental heads need to leave their egos at the door and accept that the best business decisions require the whole truth and nothing but.