There are many discussions about the importance of data in today’s economy. Many people claim that there is no more precious asset than information, but there are also many entrepreneurs who maintain that they have lived without a proper data setup for many years and they successfully survived many downturns and extreme market conditions. Are both sides right? How does this fit into the challenges most companies currently encounter?
If you enter any professional site, such as LinkedIn, within moments you will most probably see a “digital transformation” phrase. This is one of the catchiest topics in today’s market and a top challenge for many businesses. They struggle with it and want to change their structures, start their journey with new technologies, robotics, standard ways of working, and digital strategies. The data is an inseparable part of this adventure. The question arises – Can you transform digitally without having a proper data setup?
The answer is – yes! You can transform business and implement new ways of working, including cutting-edge technologies, but the cost and benefits of the journey will differ depending on your approach to data. Without having a defined and transparent data setup the journey will cost you more because it will involve multiple business approaches, software blueprints, and local habits. These costs are not seen directly but are hidden in diverse statements of work (SOWs), change management offers, or the number of people needed to perform the activities in the business processes. Benefits will decrease as process lead times go up, as additional process derogations arise, or as robotics become too complex to easily implement. How to avoid such situation? Start with measuring the status quo.
You can validate where your company stands in terms of data by answering a few questions:
- Do you know which data is critical for your business?
- Are you aware of any process implemented for critical data management?
- Who is responsible and has ownership for critical data in your company?
- Are there any data standards in your company?
- Do you measure quality of your data?
The first question raises a point related to effort invested in gathering and using the data in the company. Are all data critical or will you focus only on those that are critical and mandatory to your business, processes, or employees? Have you ever tried to answer this question?
The second question gives insights related to the way data is maintained in the system. Do you have any similar, automated way of working or does every company in your group work differently?
The third question relates to responsibility for and ownership of the data. Is there anyone who is truly responsible for the data and owns the way it is set up? If you need an example, ask yourself whether you know the person responsible and the owner of, for example, payment terms or bank data in your company?
The fourth question ask if the data really means the same in every company of your group. If definitions are set and used by your employees and people providing business insights to you. Still not convinced? Try to ask your staff for one report showing the specific data per company code and ask how they did it (e.g., net working capital). Answers including “it depends…,” or “we need to ask our colleagues in different companies…,” are not perfect but gives you insights about where you are in terms of standards.
The fifth question focuses on quality control if your data in the systems is in line with company standards. Are you sure that every company is 100% compliant with agreed rules and follows them, or does your company have multiple local habits?
Answers to these questions give you an understanding of where your company stands and whether your data is lost in no-man’s-land or gives you competitive strength over your competitors.
If any of these points piqued your interest or raised concerns, stay tuned for the next blogs which will be covering greater detail the five questions raised above. If you would like to get more insights sooner, don’t hesitate to contact me.