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Data Analytics: Investment in Better Data == 'Low-Hanging Fruit'
“The cost of increasing effective data is relatively minor compared to the substantial returns doing so can bring.” That’s the result of a study sponsored by Sybase and conducted by the University of Texas at Austin and the Indian School of Business.
Rajiv Mukherjee, member of the research team at the Indian School of Business, said that “Our results suggest that investing in better data is still a relatively low-hanging fruit.”
Anitesh Barua, the William F. Wright Centennial Professor of Information Technology at the University of Texas at Austin (UTA), added that “the benefits of improving data to make it more effective can be staggering.”
The report focused on the following ways in which data can be improved:
- Quality – accuracy, scope, timeliness and recency
- Usability – ease of use, concise presentation
- Accessibility
- Mobility – access to data regardless of location
- Intelligence – trends, recommnedations, profile matching
It then went on to cite the following benefits resulting from improving the quality of data:
Improvements to planning and forecasting. Increasing the quality of data by 10 percent results in a median increase of 118 percent in more accurate predictions.
Improvements to asset utilization. For some industries, improving data effectiveness resulted in as high as a 28 percent increase in asset utilization. Additionally, an increase in 10 percent of data mobility let to a 7 percent increase in asset utilization.
Improvements to return on assets. Increasing intelligence and accessibility by 10 percent resulted in a 42 percent increase in return on assets.
Improvements in innovation, growth and operational excellence, and ultimately, higher revenues. Increasing intelligence and accessibility of data by 10 percent enabled some industries to realize higher revenues from newer products. In the study the new revenues ranged frmo $17 million to as much as $150 million annually.
