Data is the new currency. Armed with it, new companies are disrupting established industries, and traditional businesses are transforming the way they operate. Not all organizations are equally adept at translating data into dollars, but their ability to do so is impacting their ability to compete.
"Where knowledge is power, data is wealth. It's not intrinsic in the data, it's what you do with it," said Bruce Daley, an analyst at market intelligence firm Tractica and author of Where Data Is Wealth: Profiting From Data Storage in a Digital Society. "The companies that are most progressive in thinking about data differently are the companies that are changing the economy, like Google and Uber. Most businesses lag way behind in terms of the idea that data could be their primary reason for being."
Some businesses, such as information service providers, have always been about deriving value from data. However, the ability to use and monetize data is now impacting almost every type of business. As a result, driving value from data must now be contemplated as part an overall business strategy.
"The organizations that are doing this well are trying to address a business problem at hand, not a data problem at hand," said Dan DiFilippo, global & US data and analytics leader at PricewaterhouseCoopers (PwC), in an interview. "You have to look at the problem you're trying to solve, whether that's expanding into a new market, trying to leverage more from existing customers, or acquiring new customers or employees. Then you can start looking at how data plays into to that."
Most organizations realize they have a wealth of data -- but not all of them are able to realize its potential value because technological and cultural challenges often stand in the way. Even though more lines of business are better at leveraging their data for their own purposes than they once were, the value of the data from an enterprise perspective may not yet be fully realized. Data quality issues are common. In addition, compliance, privacy, and security issues may limit the ways in which the data can be used.
"I think the piece a lot of folks miss is: You need to understand the business so you can understand the value of the data and then [you can] monetize it," said Young Bang, VP of the civil health business at Booz Allen Hamilton, in an interview.
Here are some ways to positively impact the bottom line using data.