Effective Data Drives Innovation and Efficiency

The University of Texas at Austin, in conjunction with the Indian School of Business, conducted a three-part study on the organizational impacts of data, which included the publication, Impacts of Effective Data on Business Innovation and Growth. This intensive study examined over 150 organizations within every major industry.

The study aimed to investigate, among other performance indicators, direct relationships between effective data and business innovation and operational efficiency. This investigation was undertaken to provide insight into quantifying the benefits of the vast resources that are applied to Information Technology initiatives.

The study looked at “effective data” in terms of five attributes: quality, usability, intelligence, remote accessibility and sales mobility. Specifically, the attributes were described as:

Quality – Data quality depends upon error-free data which is recent, received on time, and provides sufficient coverage of the areas of interest.

Usability – Data usability improves with ease of manipulation, presentation of data and consistency across multiple sources.

Intelligence – Data intelligence includes trends, demand patterns, recommendations and matches to relevant profiles.

Remote Accessibility – Data accessibility includes the extent to which data and applications can be accessed and run by users.

Sales Mobility – The sales mobility of data includes the ability of sales persons to provide price quotes, order information and delivery information to customers.

The study focused on three areas of performance:

Financial impacts – measured in terms of employee productivity, return on invested capital, equity, and assets

Customer-focused impacts – focused on the ability to derive revenue from new products, as well as the ability to grow the current customer base

Operational impacts – measured accuracy of planning and forecasting, as well as on-time deliverables

Effective Data: The Impact on Business Innovation

Data that provides insight into customer preferences and allows employees to see trends and patterns improves a company’s ability to create new and products and services that directly impact its revenue.

“An increase of 10% in both the accessibility and intelligence of data within a business will lead to .81% increase in revenue due to new products.”

With the median revenue of organizations in the study being $16.82 Billion, a .81% increase corresponds to $17 Million annually.

Effective Data: The Impact on Customer Growth and Operational Efficiency

The 3rd section of the study, Impacts of Effective Data on Operational Efficiency, found that the on-time delivery of products or services to customers hinges on data quality.

“An increase of 10% in the quality of data will lead to 2.8% increase in the timeliness of delivery of products and services.”

With the median on-time delivery of organizations in the study being 71.4%, a 10% increase in data quality would improve on-time delivery to 85%.

The increase in on-time delivery directly impacts customer loyalty. By growing the number of loyal customers, businesses can achieve growth, both financially and in the mission goals that they strive to achieve.

Conclusion

Improving the attributes that contribute to “effective data” can have a positive impact on business innovation and operational efficiencies. Prior to investing in IT solutions, evaluate the benefits in terms of impact to effective data for your organization.

facebooktwittergoogle_plusredditpinterestlinkedinmailfacebooktwittergoogle_plusredditpinterestlinkedinmailby feather