Our friends over at SnapLogic, a leader in self-service application and data integration, released “The 2018 Data Value Report,” a new study that reveals enterprises expect to generate a 547% return on their data investments, increasing revenue by an average $5.2 million as a result of using data more effectively. However, businesses have only scratched the surface in realizing data’s potential: On average, organizations are using only half (51%) the data they collect or generate, and data drives less than half (48%) of decisions.
The new study polled 500 enterprise IT decision-makers (ITDMs) to examine their data priorities, investment plans, and what’s holding them back from maximizing value. Conducted by independent research firm Vanson Bourne, the survey reveals that enterprises plan to invest an average $1.7 million in operationalizing data over the next five years – more than double what they are spending today. Yet enterprises are far from achieving their data-driven ambitions. Despite the clear business case for data investments, enterprises struggle to reap the rewards, held back by manual work, outdated technology, and lack of trust in data quality.
The new report provides a benchmark as enterprises develop strategies for bringing data-driven decision-making to all parts of their organizations. Key findings include:
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Enterprises are drowning in data, resulting in missed opportunities: Nearly all (98%) of respondents’ organizations are planning or in the process of digital transformation, but only 4% are ahead of schedule. Nearly three-quarters (74%) say they face unprecedented volumes of data but struggle to generate useful insights from it. ITDMs estimate that their organization uses only about half (51%) of the data they collect or generate, and less than half (48%) of all business decisions are based on data.
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Data represents a massive opportunity: The average business plans to allocate more than $1.7 million to preparing, analyzing, and operationalizing data in five years’ time – more than double the nearly $800,000 they are spending today. With ITDMs estimating an annual revenue increase of $5.2 million as a result of more effective data use, organizations stand to benefit from a potential 547% return on their initial investment.
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Customer data tops the list as the most valuable: 69% of surveyed ITDMs highlight customer data as among the most valuable in their organization, followed by IT (50%) and internal financial (40%) data.
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Manual data work wastes time and resources: ITDMs report spending 20% of their time simply working on data and preparing data for use. This includes low-level tasks such as manually integrating datasets, applications, and systems, as well as building and maintaining custom APIs.
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Legacy technology impedes data efficacy: 80% of surveyed ITDMs report that outdated technology holds their organization back from taking advantage of new data-driven opportunities.
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Trust and quality issues slow progress: Only 29% of respondents have complete trust in the quality of their organizations’ data due to inconsistencies in data formats, inadequate tools, challenges with interdepartmental sharing, and the sheer volume of data.
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Artificial intelligence is poised to tackle data challenges: 83% of respondents see potential in AI to help tackle their data challenges: 27% of respondents’ enterprises are already investing in AI and machine learning technologies, and 56% plan to invest in this area. The majority of respondents say AI and machine learning will help their organization to automate data analysis (82%), data preparation (73%), software development (66%), and application integration (63%).
There’s a saying that every business must be a software business, but what they should really focus on is becoming a data company,” said Gaurav Dhillon, CEO at SnapLogic. “Businesses understand that dedicating time, money, and talent to data will lead to long-term revenue gains, yet in reality most enterprises are still far from generating significant value and ROI. Legacy systems, tedious manual labor, and the sheer volume of information are preventing organizations from maximizing their data-driven potential. The enterprises that act now to spread data literacy throughout their business will be the ones to thrive.”
You may download the complete “2018 Data Value Report” report HERE.
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