The Growing Importance of Data in a Digital World

Data: the Core of a Digital Transformation

Digital transformation seldom equates to business transformation.  It does not require that you integrate certain back office systems.  Nor does it suggest a reduction in costs or an increase in revenue.  But both may be an outcome.

A digital transformation is more than just a technology shift. It is a fundamental change in the customer experience supported by new business models. As Matt Holt of Ogilvy One has pointed out, if customer experience represents the tip of the iceberg then digital transformation activities represent the large mass beneath the surface. This activity driven by new business models creates a depth of information about customers and insight into their behaviors that allow organizations to create new sources of customer value.

Information—or more specifically: data—can be analyzed for insights that help the company create unique, personalized experiences centered on the needs or desires of the customer. Data can be used to identify trends in customer habits which often predict future activity. Data from multiple customers can provide real-time cues and information that can reduce guesswork and enable more succinct, targeted decisions. Additionally, data collected from customers can be used to evaluate market reaction to products and services allowing for more discrete modifications.

Data and data management competency is at the center of every digital transformation. Good data fuels all innovation and customer experience improvements; bad, incomplete, or poorly formatted data sabotages it. Just because a report can be created from a BI system doesn’t mean it’s valuable. Unless the data collected reflects the important facets of the customer experience, decisions could be suboptimal in the best case or disastrous in the worst case.

Despite the challenges of keeping up with a fast moving technology shift, gaining insight should not require an army of data scientists. Companies need to collect information and store it in an easily decipherable form that they can use to create better applications or refine the customer experience.