For several years now, Experian, a global provider of information services, has been investigating the status quo of global data management. The main aspect that reports from 2018 through 2020 have in common is that companies consistently place high demands on their data, but cannot keep up with their expectations in reality. The ability to make strategic decisions reduces risks and brings innovate products to market which consequently requires companies to trust their data – is that possible, though?
There is no question that companies have recognized the importance of data in regards to business development. Experian’s 2018 report states that companies see their data as the primary source of business opportunities. According to the report conducted in 2020, 98 percent of companies indicated that high-quality data is either extremely important or critical in achieving their business goals. 85 percent of companies consider data to be one of their most valuable assets.
Improving customer experience is at the very top of companies’ priority lists according to 60 percent of respondents. Companies have vast amounts of data about their customers yet this raises the question whether these figures actually contribute to a deeper understanding of customers’ needs and expectations. Way too often, this is not the case. Data exist unchanged in individual silos, and data duplicates make it almost impossible to have a single source of truth.
Bad data are bad for business
Over the past few years, however, Experian has seen an increased focus on initiatives that aim to provide a single view of the customer. Experian notes that the sheer volume of information and the vast number of data sources represent the main challenges in this endeavor for 36 percent of respondents. 69 percent of the companies surveyed believe that inaccurate data undermines their ability to deliver a superior customer experience.
Undoubtedly, bad data are bad for business. This is not only true when it comes to making decisions, improving customer experience or accelerating innovation, but also when it comes to complying with data protection regulations and legal obligations. It is therefore worrying that on average, the companies surveyed by Experian between 2017 and 2020 indicated that around 30 percent of their customer and prospects data are inaccurate.
The issue of bad data has become so prevalent that in 2019 and 2020, only half of the survey respondents considered their current CRM and ERP data to be clean. Companies lack confidence in their data. In fact, a third of the companies surveyed believe that one of the biggest challenges of using data for business initiatives is lack of confidence in them.
The main cause of inaccurate data is clear: half of the companies surveyed in 2018 and 2019 stated that human error was the main reason behind data inaccuracy. Despite the increasing pressure to be able to collect useful information and reliable knowledge from data to make informed business decisions, Experian has not observed any improvement in the maturity level of companies’ data management in recent years. To combat the high levels of inaccurate information and to build trust and confidence in data, it is critical for organizations to have the right people, processes and technology to manage data and ensure that they are thorough, complete, valid, accurate and reliable – which leaves us with nothing more to add to Experian’s recommendation.