Becoming data champions: New research reveals five keys to data maturity and AI innovation
Senior Customer Intelligence Manager
Interviews with hundreds of global execs demonstrate why data maturity is the foundation of enterprise-wide artificial intelligence and revenue growth.
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A lot of companies are facing a lot of concerns these days. Are they actually innovating, are they investing wisely, are they keeping up, are they missing something?
The answer increasingly lies with their data, though that data can raise just as many questions as the ones it’s meant to answer. New research from the Boston Consulting Group supported by Google Cloud finds that it is the companies that can truly harness their vast stores of internal and external data, and act on that information, are becoming the most successful in the digital age. Data maturity is proving essential to boosting revenue, mastering AI, and creating a resilient organization.
Yet this is not strictly the domain of a few hyper-scaling startups or globe-spanning corporations. As the title of BCG’s new report suggests, “Any company can become a resilient data champion.” Among data-driven organizations, this survey of more than 700 business leaders finds that the most mature companies consistently use meaningful data to generate business value, invest mindfully, and build a data-driven culture that permeates the entire organization.
“Companies that truly grasp and leverage data create more value for customers, employees, and shareholders — and build stronger resilience,” concludes the report. The findings echo the results of last year’s report, “The keys to scaling digital value,” in which data maturity first surfaced as a key growth driver.
According to the hundreds of business leaders interviewed, coming from 21 countries and all major industries, organizations are increasingly relying on data to drive financial performance and financial resilience — not to mention AI capabilities. Indeed, the report breaks organizations out into “data champions” and “data laggards” and finds that data champions report twice as much revenue growth as data laggards. Data champions are also more likely to have put AI at the core of business transformation efforts.
“This performance gap will continue to widen,” the report’s authors note. “About 30% of champions expect to increase performance in revenue growth by more than 10% by the end 2024, compared to 13% of laggards.”
So if any company can become a data champion, what does it take? There are at least five areas in which these organizations excel: leadership buy-in, strategic investments, quality data, training, and partnerships. But before we explore those, a note on one of the top priorities driving the widespread adoption of data — implementing AI.
Data maturity and AI
The higher an organization’s data maturity, the stronger its AI capabilities and offerings tend to be, the survey found.
This is true across industries, but is especially notable in sectors that have been early adopters of digital transformation, such as media and entertainment, financial services, and technology, all of which report above-average maturity in AI capabilities.
In these and other sectors, data maturity yields the high-quality data that’s needed to fuel the powerful models at the core of successful AI initiatives.
To buoy its own AI efforts, your organization should consider the following best practices that BCG observed among data champions:
Promote executive sponsorship of structured data quality programs that are run by dedicated data offices.
Pursue analytics capabilities that allow processing of large volumes of data in real time.
Encourage employees to embrace emerging technologies like generative AI.
The higher an organization’s data maturity, the stronger its AI capabilities and offerings tend to be.
Data champions: 5 shared traits for success
AI capabilities are far from the only thing that separate data champions from data laggards. This research also attributes the performance gap between the two groups to five traits that data champions consistently possess and data laggards consistently lack. For executives pursuing digital transformation initiatives, these revenue-boosting traits can be a roadmap to success.
1. Champion a data-driven culture with intentional leadership
The most important prerequisite for success is intentional, aligned leadership from the C-suite, according to BCG, with an emphasis on collaboration across executive leadership and in concert with the board to build a data-driven culture. CEOs at data champions take responsibility for the results of their data-driven goals, setting key performance goals and metrics for their teams, and helping team members remain focused on the ultimate objectives.
BCG also found that CEOs at data champions are much more optimistic about their organization’s future success. Over twice as many data champions as data laggards expect to increase data-driven performance by the end of 2024.
Key finding: Seek executive buy-in and sponsorship at the highest levels — and don’t move forward without it.
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2. Invest based on data
Although data champions invest twice as much in IT transformation compared to data laggards, large-scale spending on data collection is not enough. Along with spending, success demands strategy, suggests BCG, which says 76% of data champions have a strategy in place for creating value from the data they collect, compared to just 46% of laggards.
To create positive business outcomes, data champions consistently use their analyses to strategically determine when and where to invest. That’s why champions are 15% more likely than laggards to say they plan to reduce IT and tech costs by leveraging data to make wise investments.
Key finding: Focus on quality of data spending, not quantity of data spending.
3. Use high-quality data
One of the most overlooked considerations for creating a data-driven culture is high-quality data. While most companies that are building a strong data culture have lofty goals and a focus on the future, many fail to make sure the information they collect is trustworthy, relevant, useful, and usable.
Although they’re not immune from data-quality challenges, data champions have IT architecture and policies in place that help them mitigate risks, according to BCG, which says champions’ best practices include: reducing data silos and consolidating data storage; appointing senior executives to enforce policies for data accuracy, consistency, and timeliness; and creating a dedicated data management and governance team to ensure compliance with data quality standards by internal employees and external vendors alike.
Key finding: Remember the old IT axiom, “Garbage in, garbage out.”
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4. Empower employees
Companies of all sizes and in all stages of data maturity are struggling to hire and retain data specialists. But data champions are winning the war for talent, according to the survey, which found roughly 2.2% of full-time employees at data champions are working in roles related to data and AI, compared to only 0.8% of full-time employees at data laggards.
The talent edge that champions see is also evident in executives’ priorities: When asked to rank the 10 challenges that are top of mind for leadership, laggards ranked “talent and employee value proposition” as their No. 3 challenge to overcome; for, champions, attracting talent was less of an issue, landing near the bottom of the list of challenges at No. 9.
The talent gap between champions and laggards suggests not only that champions value data specialists more than laggards, but also that data specialists are more attracted to champions than laggards. BCG’s experts believe that’s because champions encourage their teams to experiment with modern technologies. In fact, the research suggests that champions are three times more likely than laggards to have leaders that support innovation and disruption.
Key finding: Give employees the freedom to be creative and a license to break things.
The most digitally mature companies consistently use meaningful data to generate business value, invest mindfully, and build a data-driven culture that permeates the entire organization.
5. Create a robust partner ecosystem
Succeeding with digital transformation requires a large network of third-party vendors who are capable of supporting and supplementing internal data efforts.
In addition to working with a larger number of vendors, data champions expect their suppliers to be full partners in the digital transformation process. This means offering ideas, taking ownership of success, and focusing on cloud-based partnerships that allow for greater data collection.
The business value associated with digital transformation partners is why data champions are twice as likely to align procurement and incentive plans among third parties.
Key finding: Don’t treat suppliers as vendors, treat them as team members.
When it comes to digital transformation, the research is clear: Organizations can improve their performance by embracing meaningful data and using it as a tool for growth. When they lead from the front, rally their leadership team, ensure investments are based on sound data, and build a robust partner ecosystem, business leaders are laying a foundation on which to build future success.