Becoming a data-driven enterprise isn’t just a lot of analyst hyperbole. It is the ability to deliver tangible results, from successfully launching new products to achieving increased productivity. A recent study of 1,250 executives, conducted by the Enterprise Strategy Group and Splunk, reveals that data leaders—those organizations that are excelling at data classification, aggregation, quality measures, investigation skills, and monitoring—are seeing results in their bottom lines and market positions. At the same time, the survey shows, all organizations still lag in moving forward with data aggregation, classification, and monitoring.
Data leaders exhibit more progress across a range of capabilities, but particularly in the following areas, the survey shows:
Product innovation: Leaders in data innovation release twice as many product/ service innovations as beginner-level organizations. Leaders are much more likely to enter new markets, improve customer conversions, and increase the spend per customer as a result of their data-led product innovations. Innovative offerings make up 69% more of leaders’ revenue mix.
Data monetization: Leaders are much more likely than beginners to monetize data with data innovation (66% versus 36%). Data monetization accounts for 31% more revenue for leaders and is growing 75% faster for leaders than for beginners.
Employee productivity: Leaders use more data sources to optimize employee productivity and efficiency and have seen a 16% improvement in productivity—a 78% greater increase than the 9% increase reported by beginners.
Application development: Leaders are four times as likely to have significantly accelerated data delivery to application developers in the past 12 months. Ninety-six percent of leaders say speeding data delivery to developers has accelerated application development, and 95% say it has improved application functionality.
Data-driven leaders also are closer to their customers than their lagging counterparts. This results in their ability to provide better digital experiences, engage via new channels, and offer new products that better fit their customers’ needs. Across the board, respondents say that data innovation helps them achieve higher customer satisfaction (cited by 60% of respondents), improved customer retention (54%), and better customer conversion rates (48%).
Those with the strongest data-innovation practices see a greater share of the benefits. The survey shows that data-innovation leaders have developed an average of eight new products or services during the past 12 months, twice the output of beginners. Leaders are more than twice as likely as beginners to report that their data-fueled product innovation has allowed them to enter new markets and increase customer wallet share. “These and other results show that applying data to a cultural innovation commitment is providing new opportunities, even in tumultuous times,” the survey’s authors pointed out. More tellingly, leaders are nearly twice as likely to report that the majority of their product innovations are unqualified successes: 60% of leaders say so, while only 32% of beginners can say the same.
At the same time, there are factors inhibiting the development of enhanced data capabilities, according to the survey. For example, only 29% have a classification system that defines most or all data. In addition, only 40% have comprehensive data aggregation, while 29% say that some or all enterprise data is dispersed in silos across the organization. Moreover, only 39% undertake comprehensive reviews of their data quality. Others have, at best, partial insight into data quality.
The availability of data skills is another challenge, the survey shows. Only about one in five says that most of their workforce is equipped with the skills and tools needed to move forward with data-intensive initiatives.
Overall, the ability to leverage data in innovative ways is having a positive effect on internal corporate operations, the survey shows. Regardless of maturity level, enterprises are using a wide range of data sources to help their employees work smarter through greater application utilization (cited by 59%), knowledge sharing (59%), and device performance/telemetry (55%). Thirty-eight percent of data leaders have achieved significant boosts in productivity, versus only 11% of beginners. Leaders also say they’ve “fundamentally” transformed key functions about twice as often as beginners. This includes security (54% versus 28%), software engineering (45% to 20%), and sales and marketing (47% to 23%).