The global economy is in flux, and uncertainty is our new business normal. Companies are asking the tough questions: Will there be a recession? Will inflation and supply chain issues continue? Or will something else, something unexpected, happen that impacts our business? While we may not be 100% clear on the answers, there’s one thing we can say with almost complete certainty — the year ahead will be more challenging than the year that is almost behind us. To prepare for possible economic challenges, many companies are considering new data plans.
Data Risks
But there are risks — having the wrong data plan and analytics might lead to inaccurate insights, inefficient investments, dropped productivity, and ineffectual sales and marketing campaigns. Bad data plans and bad data — namely, irrelevant, inaccurate, outdated, incomplete, and unverifiable data — narrow your margins through increased costs and decreased savings while also lowering your sales due to ineffective outputs.
A few facts:
- 19% of firms have lost a customer due to bad data, according to a Dun and Bradstreet study.
- 21 cents of every media dollar is wasted due to bad data that used erroneous customer and market data to design marketing campaigns that would not work for client firms.
- 44% of CRM (customer relationship management) users say bad data has cost their firm revenue.
Bad data costs real money. In a rough economy, bad data can make the difference between staying in business and closing up shop.
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Potential Failure Vectors
Here are some potential failure vectors when it comes to partners and data.
- Failing to comply with laws and regulations, especially those regarding data sourcing and utilization.
- Failing to handle the data’s sheer volume and complexity across the business in an integrated and affordable manner.
- Failing to pull meaningful insights from the vast amount of data collected and acting upon them in the proper manner.
- Failing to keep up with the speed of technological change — not using technologies such as machine learning, artificial intelligence (AI), and as yet unseen technological innovations to make data work for you
- Failing to stop the creation of “bad data” (i.e., data that is inaccurate, outdated, or irrelevant in the business).
- Failing to secure customer or client data.
Finding the Right Partners
The types of partners you need in order to avoid bad data and bad data plans vary. For example, a data science specialty firm with market insight is most likely to help you with the issue of inaccurate data, while a legal compliance data specialist partner is more likely to help you comply with all local rules and regulations regarding data capture, move, and manage.
Your first step should be to bring in a partner to conduct a data-quality audit to identify areas to reduce costs, ensure fewer wasted efforts, and, most importantly, produce better business results. Then you act on that audit by prioritizing your risks considering this tough economy and your business realities. Taking those priorities, you act on finding partners to help you there first.
When looking for partners, make sure you check their real experience with evolving data management plans and that you make their commercial agreement both fee- and risk-based. They should share both the downside and upside of the work they do. Any partner who is not willing to put that skin in the game isn’t your partner.
Once you have selected your partners, make sure that you set clear metrics for improvements. While we can often be misled by metrics like “improve our data flow” (hard to measure day-to-day), we can’t be as easily misled by metrics that matter like “improve our click-to-close rate by 180 basis points using improved customer data insights.” During tough times setting those metrics and living by them matters — make certain your partners know the metrics and are measured by them as well.
Happy partnering!
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