The skyrocketing value of data has created a global supply and demand for data, data applications, and data services. This new data economy is powered by technologies that enable data access and sharing, including cloud platforms, exchanges, and marketplaces.
Companies that plug into the data economy are discovering a wealth of opportunities, including uncovering new market opportunities, developing new products and services, delivering more personalized customer experiences, and optimizing and streamlining operations. Businesses that don’t participate in the data economy risk becoming obsolete.
In this new data economy, how many companies are best positioned to benefit from it? Very few, according to Snowflake’s new report, How to Win in Today’s Data Economy.
In a global survey of 1,000 senior business and technology executives conducted in November and December 2021, just 6% said their company has the ability to fully leverage data. (Base: 1,000 respondents overall; Data Economy Leaders = 63; Data Economy Laggards = 163) This includes:
- Having unimpeded access to their data, no matter where it resides
- Using data to inform all or most of their business decision making
- Using data to advance strategic goals, such as growing revenue and identifying new business opportunities
- Having the ability to share data securely with external partners
These “Data Economy Leaders” are data-forward companies whose employees can access, share, use, and gain insights from internal and external data. These companies are also achieving significantly better business results than their peers. For example, over the past three years, 77% of Leaders experienced annual revenue growth versus 36% of “Laggards,” the lowest-performing survey group. 60% of Leaders saw their market share grow compared with only 31% of Laggards. And 67% of Leaders claim increased customer satisfaction vs. 50% of Laggards.
Organizations that successfully participate in the data economy deploy technology, execute organization-wide strategies, and use data in ways that were unthinkable just a few years ago. Snowflake’s research shows most surveyed organizations have ambitions to do the same, but struggle to manage and extract value from data effectively. Just 38% of respondents say that data informs most or all decisions their organizations make. Only 45% say they are able to share data with or access it from external partners.
Become a Data Leader
According to Snowflake’s report, there are three major pillars that separate Data Leaders from Data Laggards.
- People: Data Leaders commit to data from the very top levels of leadership down, while Data Laggards coordinate data from the bottom up.
- Process: Data Leaders have IT and business teams that work more closely together and ensure data sharing and collaboration internally and externally; meanwhile, almost half of Data Laggards say they don’t share data.
- Technology: Data Leaders’ IT teams have invested in cloud technologies that enable them to analyze real-time data and deliver data faster; Data Laggards often use a mix of cloud and on-premises technologies, and suffer from IT barriers and legacy systems that are less scalable or elastic.
While they constitute only 6% of all firms, the Data Economy Leaders are present in all the industries represented in the survey. The healthcare and life sciences and technology industries have a slightly higher number of Leaders. Other industries, including financial services, retail, CPG, advertising, and media firms, have slightly fewer high performers.
Snowflake’s findings highlight four ways companies can become Data Economy Leaders:
- Articulate a data strategy: Data Leaders develop and promote a strong data strategy that opens opportunities for generating insights that deliver business value. These strategies are led by end goals, not by the data itself.
- Build a strong, top-down, data-driven culture: For 63% of Data Economy Leaders, there is a C-level mandate to become data-forward, versus just 39% among Laggards. Data Economy Leaders foster a strong, collaborative data culture that includes executive support, data and analytics leadership, and enterprise-wide data literacy and training.
- Ensure your approach is collaborative, closely aligned to the strategy, and tightly governed: 62% of Leaders have a data or analytics center of excellence that coordinates data policies, and 54% enable users to access all available data through a single system or application. But the efficient and effective use of data does not require centralizing data-strategy implementations. Instead, data-strategy objectives must be aligned and coordinated across teams that can easily collaborate on data.
- Build an infrastructure that’s scalable, interoperable, and collaborative: “At the core of every Data Economy Leader’s technology strategy,” according to the report, “is a cutting-edge cloud data platform offering the latest cloud architecture and features.” This includes scalability and elasticity, interoperability, and support for data collaboration and sharing.
To learn more about the data economy, what your organization stands to gain from using data effectively, and how to become a Data Leader, download the report overview, How to Win in Today’s Data Economy.