Data-driven business models are the foundation for progress worldwide – and data has become the heartbeat of any business. We can now embed and extract data and intelligence out of every business transaction and physical object, from machines and cars to wearables, and we can harness the power of this connected data to create new value in the form of unprecedented revenue opportunities, efficiency improvements, and better customer experiences.
Sounds great, right? But if data is the answer for businesses to drive competitiveness and improve their bottom line, then the question boils down to this: What is the path I need to take to fully leverage the power in data?
Often, companies already have the key ingredients for using data to their advantage, though they may not be aware of the “how.” Certainly, a set of cutting-edge technologies such as machine learning, Big Data, and analytics methods are key elements on the path to discovering the intelligence within the data – but that is not all.
To build the data business inside your business, there are five imperatives to follow:
- Start with the business outcome, then frame a winning data strategy: The data economy is in full swing, so how will you use the data to improve your business? First, identify and prioritize the range of growth opportunities and how data can play a part. Are you looking to create new revenue streams or improve your current top line, enhance your core business processes or create and deliver new digitally driven experiences for your customer? What might be the most disruptive business scenario you can develop and execute this year? Choose the approach that best fits your company for your desired business outcomes. Data monetization models vary based on your data strategy and goals – whether you are looking to develop new business, enter an adjacent business, or enhance your core business, understanding the various models of indirect and direct data monetization strategies – and how they can work in concert together – can lead to greater efficiencies and success.
- Transform your culture, people, and processes: This is a tough one that takes time, but it is crucial for enabling your company to operate at the disruptive speed of an entrepreneur. Rapidly adopting new data-driven models requires the right culture, mindset, and nimble processes, including a culture that encourages entrepreneurialism and accountability, fostering diverse teams and agile organizations. Data-driven innovation tackles difficult and complex problems; thus, projects deal with a lot of inherent and inescapable uncertainty. Don’t be afraid to fail. Just fail fast, learn from it, and move on. Work from the business problem or opportunity backward to the solution. This will ensure that everything you do has business impact.
- Win as an ecosystem: The data economy fundamentally changes the way companies do business and deliver products. Defining your ecosystem and partnerships can be key as these relationships lead to powerful innovation hubs with the potential to disrupt entire markets. Think strategically about your ecosystem and where you can find the most benefit and with whom you can build the most trust.
- Ensure core technology: For companies to fully tap into the monetary value of data to capture a significant segment of this larger, growing market, you must first ensure the quality of your data. This is where technology starts to become a key differentiator. Working with trusted technology partners to extend your data monetization platform is paramount in the data economy. Look for these partners so that you can successfully design, architect and implement your data monetization strategy.
- Execute fast. The ocean of Big Data itself is not that exciting, but being able to navigate the waters to discover the hidden treasures is. And to do this, you need execution focus and speed. Start small and nimble to deliver tangible business outcomes quickly.
Remember that the value in data decays over time. Keeping your data assets current with real-time updates is as important as maintaining other company assets to successfully compete in a digital economy.
For more on the power of data analytics, see From Business Intelligence To Prescriptive Analytics: What’s Next?