Does your customer data create business value

Data has been a hot topic in the last decade. Big data, small data, thick data, smart data – you name it.

A survey conducted across European companies shows that big data adoption reached 53% in 2017, up from 17% in 2015, with the telecommunications and financial sectors as the leading early adopters (Forbes). So, it is still a growing area of high interest, which is why three out of four companies say that they strive to be more data-driven and will increase investments in data technologies, such as data warehousing, dashboards and other “self-service” end-user tools.

There is one important question that often drowns in the effort to create the right data set-up and navigate through the massive and unstructured amount of data across an organisation: Does your work with customer data create business value?

Transforming data into actionable insights – the missing link in becoming data-driven

For years, focus has been on gathering and structuring customer data in smart dashboard solutions and systems to measure development and effects in a variety of customer touchpoints. The missing link today is not around the data, but the ability to transform data into actionable insights that support the strategy and create business value. This is something many companies struggle to manage.

According to Forrester Research, 71% of companies today say that they have difficulties linking data to clear value-added actions. While some organisations struggle, others succeed. What can we learn from successful data-driven companies?

Three central learning points:

1. Have a clear strategic direction. The company strategy and business prioritisations must be instructive for the data work and derivative actions. Is the focus on acquiring new customers and new markets, reducing churn, increasing sales volume among existing customers or something else? Too many companies work bottom-up with all in-house data, spending massive amounts of resources on gathering and structuring data without a strategic purpose. Therefore, you should focus on selected data based on the strategic goals – and keep in mind that data are not the solution. However, data can lead to a solution and therefore, more time needs to be spent on solution designs that link knowledge from data to clear actions which can be executed in strategy.
2. Demolish silos and work across teams. Data are all over the place in organisations: in Marketing, Sales, Analysis, CRM, Digital etc. Skilled people strive to understand and interlink data across sources. But what is needed to transform data to actionable insights is to first, cut away silos that keep departmental data in feedback loops, and second, get different people from different disciplines involved in the process and start creating a new and common language. Changing the organisational dialogue is the best starting point for building successful strategic actions.
3. The right data lead to the right insights. Acquiring more data does not necessarily mean better data. It is about the quality of data. Companies with massive data sources often think they have too much data and do not need anymore. But the data are often insufficient. As we move into a world that is progressively digital, understanding the human decision-making part and how we design customer journeys and user experiences across digital and physical touchpoints becomes more nuanced than just connecting the dots. Understanding the underlying customer motivations, emotions and contextual particularities calls for deeper human behavioural knowledge that can only be revealed through qualitative data. Thus, you should use the right 5% of your existing data combined with additional qualitative insights as the groundwork for creating a valuable solution.

What is your experience with data-driven growth initiatives? Please share your perspectives on how to improve the transformation from insights to valuable actions.