SnapLogic has released ‘The 2018 Data Value Report,’ a new study that reveals enterprises expect to increase annual revenue by an average of $5.2 million by using data more effectively in their organisations. However, businesses have only scratched the surface in realising data’s potential: On average, organisations are using only half (51%) of 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 maximising value. Conducted by independent research firm Vanson Bourne, the survey reveals that enterprises plan to invest an average of $1.7 million in operationalising data over the next five years – more than double what they are spending today. They anticipate generating an impressive 547% return on their data investments. Yet enterprises are far from achieving their data-driven ambitions, held back by manual work, outdated technology, and lack of trust in data quality.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 organisations. Key findings include:
Data represents a massive opportunity
The average business plans to allocate more than $1.7 million to preparing, analysing, and operationalising 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, organisations stand to benefit from a potential 547% return on their initial investment.
Customer data tops the list as the most valuable
69% of surveyed ITDMs highlight customer data as among the most valuable in their organisation, followed by IT (50%) and internal financial (40%) data.
Enterprises are drowning in data, resulting in missed opportunities
Despite the clear business case for data investments, enterprises struggle to reap the rewards. Nearly all (98%) of respondents’ organisations 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 organisation 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.
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.
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.
Trust and quality issues slow progress
Only 29% of respondents have complete trust in the quality of their organisations’ data due to inconsistencies in data formats, inadequate tools, challenges with interdepartmental sharing, and the sheer volume of data.
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 organisation 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 labour, and the sheer volume of information are preventing organisations from maximising their data-driven potential. The enterprises that act now to spread data literacy throughout their business will be the ones to thrive.”