October 6, 2022
Sherri Silver & Nicole Dragon- Research Assistance by Kayla Minutillo
The most successful companies today are highly data and digitally enabled, using data and advanced analytics, including AI and ML, to inform actions and create value throughout their enterprise. The focus in many organizations is not only in marketing, but in pricing, operations, servicing, sales, product development and more. According to ICD’s Annual CEO Survey, digital product analytics leaders see business outcome improvements that are, on average, 2.5 times greater than lagging organizations across the top 6 of 12 business outcomes.[i].These enterprises set themselves up for increased differentiation, competitiveness, and value creation. Success stories have become common in virtually every industry sector, and those companies that that lag are increasingly obvious.
This evolution for companies is easier said than done, of course. The landscape is littered with transformations gone awry. Lessons learned stories have been plentiful through the years.
Today, the focus of conversation in boardrooms, leadership tables, and in the trenches is not “should we?”, but “HOW should we?” Our experience and analysis of marketplace trends leads us to provide the following advice to those embarking on the data driven journey.
1. Having an enabling, data forward enterprise is table-stakes for competitiveness and value creation. Consumers and B2B partners expect easy, transparent, trusted, and value-added experiences, investors want higher growth and productivity, and employees want access to information that will help them better do their jobs. These out comes can be achieved when data-enabled learning is used to enhance and personalize product and service offerings. The competitive advantage from customer data is strongest when learnings translate into rapid enhancements for the same and future customers. According to Harvard Business Review, “the most valuable and powerful businesses for the foreseeable future will be those that are both built on regular network effects and enhanced by data-enabled learning.” ii.
2. The most successful companies will use data and advanced analytics to power digital transformations and inform decisions and actions throughout their enterprise — in marketing, sales, servicing, pricing, supply chain and more. Organizations using data-driven strategies and capabilities embedded in their operations boast higher productivity and competitive edge over competitors. Numerous studies link data to financial success, operational optimization, and business efficiency. Take pricing for example – by leveraging big data to analyze customer interest, competitor prices, inventory, and geographic location, companies can price products in a way to attract and retain customers more effectively. This translates through to topline revenue impact. Organizations that lack an enterprise-wide data solution are slower to market than innovation peers and are leaving revenue on the table, with more operational costs incurred.
3. Harnessing a sprawling data landscape is a daunting, but a foundational need. Focusing attention on building a best-in-class MarTech ecosystem is necessary to a holistic strategy, leadership support, and cooperation across enterprise functions and data silos. IT leaders have identified data sprawl as a growing problem that must be addressed; however, very few organizations have a single, centralized data management platform. Connecting disparate data sources into flexible data stores to enable integrated data analysis is requisite for better insights, decisions, competitive advantage.
4. Privacy and compliance will continue to evolve and remain at the forefront for regulators, consumers and the businesses that serve them. In the United States, no singular law covers all types of data; however, state by state, consumer data privacy proposals are being drawn up and regulation and privacy is top of mind for all consumer and data driven enterprises. Consumer targeting is evolving, with the passing of the California Privacy Rights Act (CPRA),joining the General Data Protection Regulation (GDPR) in the European Union. Organizations will need to evolve practices to consider data collection and sharing rights, opt-in consent, data minimization, and nondiscrimination data use. Clean rooms, a rapidly growing privacy-compliant solution, allow data to be shared and targeted anonymously, without exposing personally identifiable information(PII).
5. Managing large datasets of first, second, and third-party data will become even more challenging, but also more important. First-party customer data capture and data partnerships will continue to increase in importance and help to reduce execution risk. With third-party cookies rapidly dying, brands are experiencing a shift in how they measure behavioral ad targeting of unknown users. More than ever, the emphasis is on first-party data, with increased regulations on second and third-party tracking.
6. Constituent expectations related to value creation will escalate as more companies advance capabilities. The pressure to derive increasing value from data will require increasing levels of skill, automation and sophistication, not only in the IT and data and analytics areas, but also within marketing, sales, operations, and lines of businesses. Those with data engines and processes that can scale and flex with larger and larger data sets and to accommodate automation, machine learning and other advanced needs will be best positioned. Use of advanced analytics, algorithms, machine learning and artificial intelligence will only accelerate.
7. Enterprises should create a modular ecosystem that can expand as needed to accommodate increasing maturity, continuous improvement and use case sophistication. Advances in computing and analytics as well as further adoption of technologies like 5Gand IOT will continue to supply new sources and uses of data. Taking the time early on to make strategic and efficient data and technology ecosystem decisions, that can flex with business maturity, will pay off.
8. The new data mandate will require skills and ways of thinking that are not widely resident in many businesses. Finding the right talent and time to up-skill throughout the enterprise can be a constraint. Leading companies recognize the need to upskill their current employees and are investing millions of dollars in retraining workers. According to Business Insider, JPMorgan Chase is investing in a $600 million plan to upskill their workforce, Amazon is investing more than $700 million to provide upskilling training to employees, and PwC is spending $3 billion to upskill all 275,000 employees over coming years; the mantra of the program is “New World, New Skills.” iv.
9. Change management is perhaps the most overlooked de-railer to a potentially data powered enterprise. The journey requires multi-year investment and organizational commitment. Senior management needs to understand and be aligned with the vision, the timeline, the short and long-term benefits, and return on investment. New organization structures and norms are often needed to take advantage of efficiencies, maintain data integrity, drive business adoption, and create more consumer centered outcomes. Enterprise communication is key to creating data literacy and a data-driven culture. Data, technology, marketing, product, and other functional areas need to prioritize and collaborate, in often unprecedented ways, to enable a holistic data enterprise.
10. Getting it right will power a cycle of innovation and continuous improvement in virtually all aspects of your business. Organizations cannot afford to ignore the value data lends. A Forrester Consulting survey found that data-driven businesses are 58% more likely to hit their revenue goals and 162% more likely to significantly surpass those revenue goals than laggard counterparts.iii. An overarching enterprise wise business strategy, with data at the core of all functions, will set the outperformers of the next decade apart.ISTOCK
At Blend360 we strive to enable our clients with holistic data driven strategies, to ensure a successful future in an ever-changing landscape. Sifting through the noise to find the right solution that will drive the right value is no easy feat. We help support and create visions of what is possible and a plan to activate - we are ready to help your company succeed.
i. Worldwide CEO Survey, IDC, January 2022
ii. When Data Creates Competitive Advantage, Harvard Business Review, February 2020
iii. CIO Dive, Data Driven Companies, May 2020
iv. The Upskilling Economy, Business Insider, November 2020