Why Having a Data Strategy is Important for Gaining a Competitive Edge

Posted: 09/06/2022

Most organisations have a business strategy in place (not all), but not a strategy for gaining a competitive edge by extracting value from data…

Most organisations have a business strategy in place (not all), but not a strategy for gaining a competitive edge by extracting value from data. It sounds like a strange strategy to have, but no matter the size of your business or the industry that you are in, data is integral to how your business operates and grows, having a data strategy proactively leverages data toward the long-term business goals.

As the world increasingly becomes connected, vast amounts of data are being generated, this provides businesses with a great opportunity to create new and unique ways to improve products and services and provide new propositions for the business. However, building any type of strategy can be a challenging task, so with Data Science still being a relatively new topic and with limited resources available, it is important to have a clear set of goals from the start.

A data strategy should outline a set of choices and decisions which chart a course of actions to achieve business goals. This approach should include business plans that include data, with the intention to gain a competitive advantage and grow the business. This blueprint, therefore, aligns decision-making with data.

The importance of a good data strategy

When we talk about data strategy, we are referring to the tools, processes, and rules that help us to analyse, manage and gain insights from business data. It also helps to comply with industry regulations and keep our data safe.

Nearly all businesses collect data in various formats, and having a strategy in place helps a business to interpret this data to gain valuable actionable insights, and solve challenges such as:

• Inefficient and slow business processes
• Managing huge amounts of critical business data
• A lack of understanding of current business needs
• Information isolated in different parts of the business
• Lack of visibility of customers, competitors, and the market in general

When a business doesn’t have a data strategy in place, it will be less competitive and poorly positioned to grow successfully.

What are the objectives of a data strategy?

A data strategy should be designed to reinforce and advance your business strategy, which focuses on the business processes, how they are used and how you operate. When crafting an effective data strategy, you need to work toward multiple business goals such as:

• Ensuring that data is managed and utilised effectively across the business
• Empowering and supporting users’ data needs
• Creating new value and efficiency through innovation
• Addressing business data security risks and compliance requirements

Studies show that between 67 and 97 percent (depending on which study you read) of businesses never achieve their business goals, the reasons stated are; poor communication; lack of stakeholder buy-in; and lack of clarity, but they all come down to one thing, a disconnection between business planning and implementation. Having a solid data strategy can be the biggest asset in connecting business strategy and implementation.

How to get started with a Data Strategy

A data strategy is foundational when becoming a more versatile and analytically mature business and should be seen as an ever-growing plan that takes a holistic view of technologies, processes, and people. As the plan develops you should work towards the following 10 stages:

1. Identify all stakeholders and identify a data strategy champion
2. Address specific business needs to achieve business goals
3. Connect business goals with department activities
4. Analyse, identify, gather, and document data sources
5. Build a scalable and flexible data architecture
6. Define a strategy for extracting business-critical insights
7. Look at the skillsets of the people within the organisation, their strengths, and areas for improvement
8. Ensure that the right people have access to the right data, from the right places
9. Create a future timeline of where you would like to go in the future
10. Celebrate wins

Nexus Technology helps businesses with varying levels of analytical maturity and technical requirements, and our consultants are ready to help you build the foundations needed to grow your business.

Are you ready to move data out of silos?

Nexus use a broad set of skills, along with data, digital and technology capabilities to help businesses to create and transform data, delivering value and cost savings, learn more at nexustech.je.

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