In times of recession, can you afford NOT to invest in data management?
The global economy is facing challenges on many fronts, with inflation and recession becoming the words of the day. As a result, budgets that are always tight (like IT) are under even more scrutiny than before. Any unnecessary spending needs to be curtailed, for obvious reasons, but does data management fall into this category?
The simple answer is no. The reality is that bad data leads to bad decisions, which in turn lead to poor performance. When the bottom line is everything, and data is the foundation, businesses simply cannot afford the problems that poorly managed data brings.
Going up, not down
Despite economic headwinds, there are signs that, internationally, Chief Data Officers (CDOs) are actually looking to increase their investment into data integrity, as highlighted in the 2023 Data Integrity Trends and Insights report, which has just been released.
There are many reasons for this – data volumes are not reducing as a result of recession or inflation, the criticality of data to business has not lessened, and the need to use data to drive competitive edge is arguably more important than ever.
There is also compliance to contend with – the Protection of Personal Information Act (POPIA) is still in effect, and organisations that do business internationally still need to contend with laws from other regions, including the General Data Protection Regulation (GDPR).
Unprecedented Global Uncertainty
Yet, while these fundamentals haven’t changed, the world certainly has. Businesses have had to cope with radical changes in consumer behaviour driven by COVID, with global instability caused by the war in Ukraine, with the impact of rampant and ongoing load shedding, and with the new threats and opportunities introduced by generative AI.
Strategic investments, whether in digital transformation or in new data products built around artificial intelligence and machine learning, are dependent on high-integrity data.
Leveraging data as an asset
The ability to analyse and derive actionable intelligence from data lies at the heart of agile decision-making in a digital world, and in tough times, businesses simply cannot afford to make bad decisions. While organisations obviously need to be pragmatic about their investments, cutting spending on data management foundations is not the solution for successfully riding out economic recession.
In fact, respondents to the Data Integrity survey identified poor data quality as the biggest barrier to achieving their data goals, impacting everything from executive support for advanced analytics programs to the infrastructure required to run them.
In reality, many organisations still do not understand their data landscape, and there is a huge amount of redundancy and duplication around data. This can get expensive, as storage remains a significant cost centre, and is one area which can and should be optimised to deliver returns fairly quickly. Aside from cutting down on storage costs, effective data management also helps businesses to understand what data they have and where, which is essential for both compliance and analytics purposes.
Data analytics can help give businesses a competitive edge by enabling them to better understand their environment, their customers, and the changing needs of both. Data management is also a critical component of the ability to monetise data by building data products, another way that businesses can not only survive, but thrive, through recession.
Time to get strategic
Appropriate investment into data management helps to ensure that data can support business strategy and outcomes, but it needs to be driven at a strategic level. Improving data governance should be a top priority, and one area that can drive significant value is data lineage. By leveraging automated data lineage tools, organisations can obtain a comprehensive overview of data flows, sources, transformations, dependencies and more. This in turn helps to automate tasks efficiently, improve business intelligence and effectively position organisations to achieve their business imperatives in a challenging market.
The key is to leverage the best combination of data strategy and tools to maximise return on investment and set a company up for success. If you do not understand how your data is impacting your ability to survive, and where and what your critical data is, it is essential to revise your data strategy and look to invest appropriately.