According to Gartner, “by 2017, 33 percent of Fortune 100 organizations will experience an information crisis, due to their inability to effectively value, govern and trust their enterprise information.” These large organizations need to manage extensive amounts of data across numerous business units, often leading to unavoidable data quality issues. How do you get key stakeholders to really understand the impacts data quality has on the business?
The challenge for many organizations is defining the real value of the data, which makes it difficult for IT users to get buy in from business users and their executives or business users to get buy in from IT users. And for many organizations, managing data quality can seem like a daunting task. However, having accurate and business-ready data is a critical component to ensure that your organization does not experience the negative impacts that can accompany “bad” or “dirty” data.
There are several areas across your organization impacted by data quality, but in our recent infographic we looked at three major areas: financial, business and legal impacts.
According to Experian, 77% of companies believe their bottom line is affected by inaccurate and incomplete data and that on average, those respondents believe 12% of revenue is wasted due to poor data quality. That is a staggering statistic when you see such a large percentage of organizations that are negatively impacted by the lack of data quality. However, those organizations that did put a focus on the quality of their data, saw a 15%-20% increase in revenue.
Additionally, according to Gartner, businesses have seen 40% of their initiatives fail to achieve targeted benefits due to poor data quality. For an organization to fail on such a high percentage of programs has significant effects on operational efficiency. A focus needs to be put on developing a strategy and implementing processes to manage and maintain data quality to improve productivity and reduce interruptions to the business.
To that point, Bardess Group found that when a data quality initiative is implemented it can lead to 20%-40% increase in sales for a business. These stats illustrate a clear correlation on how data is an essential part of a company’s operations. The quality of an organization’s data has effects on their sales, productivity and revenue but whether those effects are positive or negative depends heavily on whether a plan exists to improve overall data quality.
Organizations need to be fully educated on the impacts that data quality can have on the business as well as be prepared to implement a data management strategy to avoid suffering from an information crisis. Inaccuracies in data can affect operations across the entire organization, so getting a handle on the data early on is key to avoid project delays, compliance or regulatory issues and/or unnecessary costs.
To see more stats on how data quality can affect your business process, view our complete infographic here.