The COVID-19 pandemic has accelerated organizations’ move from intuition-based to data-powered decision making. Why? Primarily because the sudden impact of the pandemic exposed black spots in global supply chains, shuffled demand patterns, and significantly impacted the travel and entertainment industries. Those organizations that had the capability to harness insights were able to respond with agility and resilience.
Moving from intuition-based to data-driven decision making
Data literacy is a key element of an organization’s ability to be insights driven. Indeed, data literacy is defined as the ability of an organization’s key decision makers to make data-driven decisions by providing them access to the tools/technologies to access/manipulate data and training them in how to know, speak, and argue with data.
Data literacy supports data/technology democratization by decentralizing data-driven decision making, empowering users to drive faster, reliable, and actionable decisions.
Data literacy remains in its infancy
Despite its transformative potential, industry commitment to, and spend on, data literacy remains low.
While the current market spend on data literacy is $530-560 million, only 10-15% goes to standalone data literacy engagements. A large percentage of data literacy initiatives are baked into broader data and analytics transformation programs, as data literacy is considered an adjunct to broader people change management processes.
Why is commitment to data literacy lacking?
While there is surely a lack of enterprise education related to data literacy, the larger challenge is for enterprises to provide the right data assets to the right people.
1. The right data – The right data refers to the relevant, high quality data assets required to perform a specific business task. These assets could be internal/external or first/third. Organizations struggle to build a consolidated view and repository of their data assets through a centralized data management and governance strategy. Moreover, developing the ability to exploit external data for added insights and decision making remains low on most organizations’ radars. As a result, enterprises’ data assets mostly exist in siloes and remain grossly underutilized. Moreover, lack of governance and processes around data quality hinder business users’ trust in insights generated with the existing data assets and technologies.
2. The right people – The right people refers to the business users who need to be empowered to make data-driven decisions. Enterprises generally struggle to find the right people who are trained to work with data and associated technologies such as AI and advanced analytics. The large demand/supply gap for key data and analytics skills further aggravates the problem. This shortage in talent supply is further exacerbated by low project readiness and poor domain understanding of the available talent pool.
Another key challenge is identity and access control to prevent data breaches and civil lawsuits. The prevalence of laws governing data – such as CCPA and GDPR – further impede enterprises from going all-in on insights driven decision making.
For enterprises to make data literacy actionable, they need to connect the right data to the right people supported by strong leadership commitment and a centralized governance structure.
Rewards associated with data literacy
Both IT service providers and technology companies have started to offer credible data literacy services, including both technology solutions for self-service analytics, such as Qlik and Tableau, and targeted training programs to address the demand-supply gap, like Qlik’s. IT service providers, including Accenture and TCS, recognizing the growing need for data literacy, are offering solutions that support data/technology democratization.
Data literacy used across the organization leads to insightful decision making, which helps the organization to become agile, resilient, and sustainable, increasing its competitive advantage in an aggressive and fast-changing global economy. Data literate organizations can also sustain growth during the normal evolving business landscape, as well as during black swan events such as a pandemic.
This blog is the first in a series exploring the core concept of data literacy and its importance for enterprises. If you have any questions about how data literacy can help your organization tackle complex situations, or if you would like to share how insights-driven decision making helped your organization work through a critical period, please write to us at [email protected] and [email protected].