Report: Data blindspots leading to digital and customer transformation failure
- 21 February, 2019 09:45
A new report has found an inability to share data across organisations is styming Australian organisations and leading to digital transformation failure.
The new research commissioned by Microsoft Australia found while 69 per cent of local enterprises say they have an integrated digital transformation strategy, only 28 per cent have a company-wide strategy for sharing data, meaning projects are failing.
In addition, the research revealed over a third (37 per cent) of Australian organisations claimed more than one in five of their customer experience (CX) projects had failed, costing them hundreds of thousands of dollars. Again, data was found to lie at the heart of these failures.
The study of 505 medium to large organisations was conducted by business-to-business research agency, Colmar Brunton, found data is too often locked away in silos, where it is not easily surfaced or accessible, acting as a brake on transformation.
As a result, the biggest challenges respondents faced include being able to customise offers and bundle products and services with personal pricing; modify go-to-market strategies in real time; gain a 360-degree view of the customer; and validate and test new ideas. All of these require access to the right data at the right time to gain intelligence and insights.
Without access to a comprehensive array of data, organisations are limited in their ability to intelligently use data to engage customers, empower people, optimise and automate processes, and transform products and services.
However, this also means there is significant transformation opportunities for Australian enterprises moving forward.
Asked about the importance of data in terms of automating business processes, 83 per cent of respondents said it was ‘somewhat to extremely’ important; 82 per cent said the same about access to data to gain a 360-degree view of the customer; and 79 per cent said it was somewhat to extremely important for generating a real time insight into the pipeline of opportunities.
However, the research also reveals that in spite of the critical role data plays to CX transformation, almost a third say there is little to no data sharing across the organisation.
Microsoft said crafting corporate-wide data sharing policies and implementing technology that allows all of an enterprise’s data to be accessed when and where it is required is critical to optimise decision making and take informed action across an organisation, and reduce the risk of failed and costly CX projects.
Respondents also said two major barriers to successful transformation were a lack of senior management support (64 per cent) and a lack of company strategy from the board down (61 per cent). This suggests that there needs to be a much clearer narrative from the top about the importance of transformation to the organisation, and the benefits it will deliver.
Michael O’Keefe, business applications director at Microsoft, said transformation requires an integrated digital strategy with comprehensive access to company-wide data at its heart. This encourages informed insights and better decision-making, which in turn, delivers dramatically enhanced outcomes.
“It’s really important that organisations identify and tackle their digital blindspots – and introduce policies, processes and technology that lets data help draft the organisational transformation blueprint,” he said.
“We wanted to understand where customers and Australian businesses are at in terms of driving business transformation.
“What we found is only 28 per cent had a company-wide data strategy, which is pretty low.
“So there is not a lot of data sharing across organisations. I think this is because over the last five to seven years businesses have been accelerating IT modernisation to be able get a better handle and drive value around data. Now they are starting to concentrate on CX and drive this.
“There is potentially a lack of maturity in terms of the ability to take data from the silos and drive value from it. There is also a data governance problem.
“We recommend four areas to focus on to improve, including customer engagement and connecting to those customers with the right data, empowering employees, operational efficiencies, and transforming services and products for the market,” O’Keefe told CMO.
He also recommended businesses understand how their customers engage with their products and services, and then starting small and scaling as they deploy data platforms.
He said while a lack of skills might currently be occurring around this in the workforce, we will see more people with digital native skills starting to appear.
“Organisations do need to think about how to best use the data to drive value. Of course, they also must consider privacy and factor in relevant legislation, and looks to scale CX and have the scope to look at the next gen of CX. CX is layered through the whole business as customer demand grows.
“Australian organisations are in a great spot to continue to keep innovating and to keep an eye on innovation going on globally, we just need to ensure we focus on the fundamentals of getting that data strategy right,” he said.
The research, which focussed on the finance, retail and government sectors, asked organisations to rank the prioritisation of four key areas aligned to their transformation efforts: Customer engagement, employee empowerment, operational optimisation, and product/service transformation.
Respondents were asked to rate successful delivery on a scale of zero to ten, with a ‘net success score’ produced. Again, engaging customers was the only outcome to achieve a positive ‘net success score’.