“You know a lot about your customers. You have all the data,” a CIO of a major banking organisation told peers at an industry gathering. However, she went on to add that, as the data isn’t joined-up, organisations are unable to utilise the information and draw useful insights.
Underutilised data prevents organisations from being effective, and therefore leaves them unable to innovate. A data engineering approach can transform data into insight and can also transform an organisation’s operations.
The new normal
COVID-19 led to unusually high growth in 2020 but, as is well documented, the technology-led change to ways of working, living and business operations will remain in place beyond the pandemic. This means that the data growth seen in 2020 will become the new normal. “The amount of digital data created over the next five years will be greater than twice the amount of data created since the advent of digital storage,” says Dave Reinsel, Senior VP at technology analysts, IDC, and author of the IDC Global DataSphere report. This report states that data will experience a compound annual growth of 23% for the period 2020 to 2025. Driving this growth is the adoption of the Internet of Things (IoT) and increased use of cloud computing.
Data enables digital resiliency
With data levels increasing, financial services, government and other vertical markets will need to engineer a strong data strategy. The IDC report notes that data is “crucial to any organisation’s efforts to establish digital resiliency – the ability for an organisation to rapidly adapt to business disruptions by leveraging digital capabilities.” This enables them to restore business operations but also to capitalise on the changed conditions. “Data enables digital resiliency because business is dependent on data.”
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The business case for data engineering
Organisations with good data engineering are more confident and report that their businesses are better able to respond to changing events. A European YouGov study found that 68% of data-driven business leaders are now more optimistic about the future of their businesses. These organisations are also investing in their belief, with 76% of respondents reporting that they’ll continue or increase spending on data skills training and development within their organisations in 2021.
The YouGov survey of 3,500 European business and technology leaders in France, Germany, the Netherlands and the UK also reported that organisations with strong data engineering are able to make strategic decisions more rapidly, have improved communications with their teams and experience higher levels of collaboration.
Data as a strategic asset
“You need to look at the data that you have from your supply chain, customers and employees to find the insights that make your business function effectively,” says Ramona Fuchs, Head of Strategic Relations at esynergy.
Data has to be engineered into a strategic business asset because, like revenue, technology or the retention of talent, data represents a constant opportunity and therefore demand on the business. Companies that successfully implement a robust data strategy, and that continually evaluate and evolve their data use can reap the rewards. A data strategy requires a plan for sourcing and storing data, concepts for putting data to work and – perhaps most importantly – a process for evaluating which ideas are most effective.
Responding to the changing demands of customers
Underutilised data prevents organisations from responding to the changing demands of their customers, and nowhere is this seen more clearly than in financial services. Business advisors, Boston Consulting Group (BCG) stated in its report Global Retail Banking 2021: The Front-to-Back Digital Retail Bank, that banks must reimagine the entire end-to-end processes of their operations, improve risk control and integration, and transform the technology offering to the customer. None of these changes will be possible unless financial services providers grapple with their data silos and develop data strategies and engineering that enable large scale change. “It’s about making sure you’re being smart about how you can make a difference to your clients and customers, as well as making sure you’re asking the right questions,” says Fuchs.
Faster decision making
Well utilised data can also be used to understand an organisation’s most important asset – its people. Data allows organisations to put their fingers on the pulse of the business and leads to the development of high levels of trust and empathy that ensures customer satisfaction and loyalty. The YouGov survey found that 42% of data-centric organisations reported during the pandemic that their communications to employees and customers were more effective, while 40% of business leaders reported an increased ability to make decisions faster – a vital component of leadership during unwanted disruption. Collaboration, which improves loyalty, wellbeing and customer satisfaction, also increased in data-centric organisations according to 36% of the survey’s respondents. As a result, 80% of the survey group reported that data has been ‘a critical advantage during the pandemic’.
Data and analytics: a core business function
“The speed at which the COVID-19 pandemic disrupted organisations has forced data and analytics leaders to have tools and processes in place to identify key technology trends and prioritise those with the biggest potential impact on their competitive advantage,” says Rita Sallam, distinguished research vice president at technology analysts, Gartner. Research carried out by Sallam suggests that data and analytics have become a core business function, considered a shared business asset that is clearly aligned to business results.
With the realisation that well-engineered data directly correlates to business results, organisations are focusing on breaking down data silos and increasing levels of data collaboration across their organisations, Gartner reports. Breaking down data silos results in improved productivity, profitability and innovation.
Next-generation business benefits
Organisations that utilise data well will quickly become sector leaders in new markets. For example, in the move towards smart meters (to lower the carbon impact of homes), a leading UK energy provider and esynergy used the Microsoft Azure enterprise cloud computing platform to collect and process the large levels of data that smart meters produce. This data created a portal and mobile application for customers: Together these have enabled customers to optimise their energy usage, while the customer service the energy firm provides has improved. A further business benefit is that the mobile application and portal lowered customer service costs to the energy provider. So, customer and business benefits have both been realised from engineering a strong data strategy.
Developing a data-centric culture
Data engineering uses visualisation to create a representation of the user journey, whether they’re a smart meter user or banking customer. Visualisation ensures bottlenecks and pain points in the customer experience are identified, and customer service improvements are delivered at pace. “We apply data modelling techniques, including machine learning (ML) and artificial intelligence (AI), to this process to really optimise how an organisation’s customers or users interact with a service,” says Patrick Crompton, co-founder and director of esynergy.
Data engineering specialists help organisations research and develop a data utilisation roadmap bespoke to their business and customer requirements. With the roadmap in place, data engineering specialists can develop data thought-leadership, across the organisation, to develop a data-centric culture. The datasets within the organisation are analysed and then modified as part of this process to ensure the roadmap creates an efficient data workflow that will deliver a return on investment (RoI), but that will also be able to respond to new data opportunities that may arise in the business. At the end of the roadmap process, the organisation will have increased visualisation of its data, with improved data integration and an ability to stay ahead of changes to data legislation.
A data engineering approach can transform data into insight and revolutionise the operations and customer service provided by an organisation.