Data mastery is critical to gain a competitive edge and organizations that don’t take concrete steps to achieve this will struggle to keep up, highlights the report. Only one in six (about 16%) organizations can be categorized as ‘data-powered’ or as ‘data masters’ based on several factors of data mastery, including outperforming their cohorts in financial parameters such as revenue generation and profitability.
COVID-19 has pushed organizations to adopt data-driven decision-making approaches more quickly. While progress has been made, a majority (55%) of businesses still use data just for reactive decision making, meaning they lose out on a competitive advantage. Only 21% use predictive approaches, 16% use prescriptive approaches, and just 8% use an autonomous or self-optimizing approach. At a country and sector level, reactive decision-making approaches are most prominent in Italy (64%), India (61%) and Sweden (61%), and in terms of sectors, consumer products manufacturing (62%) and industrial manufacturing (59%) are most reactive.
Data-powered enterprises enjoy significant business benefits
Data masters enjoy between a 30% to 90% advantage in metrics across customer engagement, top-line benefits, operational efficiency, and cost savings. Furthermore, Capgemini’s research shows that data masters realize a 19% increase in sales of new products and services compared to 12% for the rest. Unilever, for example, identified emerging consumer interest in ruby chocolate, a pink chocolate, through its social business analytics platform. This insight allowed Unilever to launch the first variant in this space ahead of its competitors.
Trust in data is key to organizational agility, collaboration and generating value
Of the organizations where data is not trusted, the research found that only 24% were able to monetize their data assets in comparison to 83% where it is trusted. Major gaps exist between business executives’ trust of data and technical executives’ perception of this trust: only 20% of business executives trust the data while 62% of technical executives believe their business users do so. Poor data quality is a major contributor to this mistrust: only 27% of business executives are happy with their data quality while 54% of technical executives think their business users are happy with the quality. However, the consequences of poor data quality are significant, costing companies between 15% - 25% of their revenue.
Significant gaps still exist between the C-suite and data executives
While many organizations have started on their data journey, only 38% are able to harness the power of activated data. In terms of functions within specific sectors, 54% of banking business leaders agree that harnessing activated data gave them a sustained competitive advantage, compared with only 32% of retail business leaders. Of the enterprises that are considered ‘data masters’, 95% have an appointed Chief Data Officer (CDO) and 77% stated that the CDO has been instrumental in realizing the data vision of their organization. Given the prominence of this role, it is perhaps not surprising that an average 42% of organizations surveyed stated that their CDO reports directly to the CEO, CIO, or CTO. The overall roadmap to harness data needs not only to be addressed just in the technology department, but up to and including the C-suite.
“Business leaders fundamentally need to look at their data strategy and innovation pathway,” says Zhiwei Jiang, CEO Insights and Data at Capgemini. “We still don’t have enough data-minded leaders at the C-suite level to drive organizations on the right data journey. There’s a lot more at stake for businesses who don’t act; from operations to sales, customer engagement, revenue and profitability. Those that can monetize data and convert these into assets will thrive. Those that don’t will get left behind. A mindset change is needed - leaders must accept and embrace an agile culture of experimentation if they are to achieve data activation.”