Data is the holy grail of business – you need to know that

Did you know that data-driven companies are 23x more likely to acquire customers and 6x more likely to keep customers? They are also 19 times more likely to be profitable. These statistics come from the McKinsey Global Institute and illustrate how important data is to business success.

Today, information is power, and when a company has access to the right data, it can use that data to drive business growth and success, rather than just using data to report and reflect on the company’s performance.

This is why data is transformative and why it is the holy grail of today’s business world.

According to Gartner, “In the future, data and analytics will drive modern business operations.” Assuming Gartner is right, companies that have already started their own data-driven transformation are set for long-term success while the rest are left behind. The data proves it. NewVantage Partners’ 2020 Big Data and AI Executive Survey found that 70.3% of companies investing in big data and artificial intelligence are seeing measurable returns from those investments.

Becoming a data-driven company doesn’t happen overnight. It’s a process. Here are seven key considerations your organization should understand to begin its own data-driven transformation:

1. Adopt a data-driven corporate culture

Based on the results of NewVantage Partners’ 2020 Executive Survey, only 26.8% of companies have a data-driven culture, which presents a great opportunity to bridge the gap.

The first step to harnessing the power of data is recognizing that your organization needs to invest money to build data as a strategic asset. Additionally, data strategy should be owned by senior leadership and extended to all employees through a data-driven culture.

Once all employees embrace the culture of data-based decision-making, you are on your way to a successful data-driven transformation. But to do that, you need to invest in technology, talent, training, and possibly external data sources.

2. Develop and commit to a data strategy

Anyone can say their business prioritizes data, and many executives believe their businesses are data-driven. However, the reality is very different.

Looking at the Dell Data Maturity Model (DDMM), there are four phases an organization goes through in developing, implementing and defining a data strategy:

• data conscious: At this early stage, the data is unstructured and assembled manually. There are no centralized data stores or tools for enterprise-wide reporting and analysis.
• data literate: Data is often unreliable, efforts are duplicated and processes are slow as organizations become data literate. In addition, a lot of data is not yet effectively structured. Most companies stay in the data literacy phase the longest.
• data savvy: In the Data Savvy phase, data is plentiful and reliable, and processes are in place to analyze that data and make decisions based on it.
• data driven: Data is at the heart of every process and decision as an organization enters the data-driven stage. In fact, no decisions are made without data.

Each level of the DDMM has a specific goal. To go from data aware to data literate, organizations need to develop standardized reports, and to go from data literate to data savvy, they need to track key performance indicators (KPIs) using a business intelligence platform. To go from data-powered to data-driven, organizations must be able to make decisions related to critical initiatives using data. Finally, in the data-driven phase, the goal is to increase scale and reduce costs.

According to a study by Forrester Research, organizations only analyze 12% of their data, which means 88% of the data is wasted. In other words, most businesses still have a long way to go to become data-driven, which means developing and defining a data strategy is essential.

Bottom line, if you’re only analyzing 12% of your data, you’re not data-driven.

3. Identify your data sources

Where are your people getting the data they need to make business decisions, identify opportunities, and be proactive rather than reactive? First, determine how you plan to use data (i.e., your goals) and what kind of data you need to achieve your goals.

Some data may be collected internally, so be prepared to invest money and time to develop the architecture needed to collect and store that data. In addition, some data may need to come from external sources. Recommit to investing the money necessary to get the information you need to be successful.

When it comes to consumer data, you should collect it from every possible source. This includes first-party, second-party, and third-party data. First-party data is data that your company collects directly from your customers through your own channels. All of your customer-facing systems should be set up to make it easy for your employees to collect, access, and use first-party data.

Third-party data is purchased from a trusted partner that you have (or pay for) a relationship with. The data is reliable because it is collected as first-party data – it is only collected by a trusted partner and not by you. Third-party data is compiled by data aggregators. If you use data from third parties, you need to be very selective about the sources you get the data from to ensure that it has been lawfully collected and is accurate. Your business systems should be set up to seamlessly import data from 2nd and 3rd parties so your employees can use it effectively.

4. Determine how you will use the information you collect or access

How will you turn the data you have collected or have access to through an external source into actionable insights that can guide decision making and help your organization achieve its strategic goals? Do you have the talent to analyze and use your data? Do you need to hire or outsource specific jobs to get the best results from your data?

A critical part of using data effectively to drive business decisions is analyzing it and using it to identify opportunities (or risks) so you can take advantage of those opportunities (or mitigate the risks) to drive revenue, operations, and value to improve for the company. Therefore, you need to make sure you have the resources to use your data effectively.

5. Democratize your data

Data is powerful, but when only one or two people or departments in your organization can access it, its potential is limited. For data to be transformative for an organization, it must be accessible for day-to-day decision making across the organization.

Data can power and streamline processes for marketing, finance, sales, customer service, legal, operations and other teams across the organization. When decisions are made based on data, they are usually better and lead to more success. Therefore, as much as possible, ensure that decision makers have access to the right data to make the best decisions.

6. Development of data accuracy and privacy processes

Data accuracy is always important, but the more people in your organization rely on data to make decisions, the greater the risk of loss from decisions made with bad data. With this in mind, it is important that processes and policies are put in place to ensure everyone is using correct data. For example, a data accuracy policy should require verification of external data sources to confirm that only reliable data providers are used.

When your employees use data on a daily basis, it is critical that your organization has privacy policies and associated procedures in place to keep the data secure and compliant with relevant privacy laws such as the California Consumer Protection Act (CCPA). This includes both internal and external data to prevent illegal data sharing and other data-related practices that may be illegal or unethical.

7. Be ready to spin

The way data is collected and used will evolve in the future, so your business must be prepared to adapt to changes in rules, methods, and technology. Agile systems and agile marketing will be crucial in the coming years.

For example, privacy regulations are already changing, affecting consumers and marketers. Last year, Apple changed the privacy rules for its users, and Google changed their privacy rules soon after. These will not be the only changes for Apple and Google, nor will Apple and Google be the only companies changing their privacy practices and rules going forward.

New data protection regulations are also coming from regulators, and businesses must be prepared to change in line with the demands of these regulations. For example, as of December 1, 2021, Illinois dispensaries are required to protect medical marijuana patient information with the same standards that companies and healthcare providers are required to protect patient information in the medical industry under the Federal Health Insurance Portability and Accountability Act (HIPAA). . There are already rumors that other states could publish similar data protection rules for patients.

As with most things related to the cannabis industry, we can expect changes in the future, and that includes changes in privacy laws and practices. Your business must be ready, willing and able to turn around.

Key insights into leveraging data for business growth

Data is changing the cannabis industry. Whether you run a cannabis business or a side business, you need to prioritize data so your business can gain and maintain a competitive advantage that translates into long-term growth.

According to NewVantage Partners 2020 Executive Survey results, only 45.1% of companies compete for data and analytics, and only half of companies manage data as a business asset. This means organizations have a significant opportunity to prioritize data and gain a measurable competitive advantage.

Start the data-driven transformation of your business now by integrating data into your business DNA, developing a data strategy, identifying your data sources, getting your data to the people who need it, using it effectively and legally, making sure it’s accurate are, and remain agile.

Originally published on 02/28/19. Updated 6/10/22.