Data-economy

Why a specialist partner is critical to your data strategy

Governments’ management of the COVID 19 pandemic has shown the value of a strong data strategy. The use of continuous, real-time data flows to detect trends in infection rates that have steered actions and policies. Unfortunately, it has also demonstrated how misinterpretation, inappropriate or incomplete data can lead to poor decisions. There are lessons for both Governments and also for companies.

Shell Denmark developed a system in the early 1990s to measure the flow of customer heating oil consumption from the pump impeller via the telephone to a central system which managed automatic replenishment. The result was that no customer run out of oil and Shell could optimise its transport fleet rather than organise transport for peak demands when the weather became cold. Great idea, poor timing! The right technology was not then available. The idea is still good but today the technology has moved on rapidly.

Customer behaviour data is increasingly important to companies allowing them to provide outstanding service. But it raises many questions about data privacy and security. Using specialist data companies to manage data can alleviate customers concerns around security and proper process.

Operational performance data has less privacy and security concerns, although confidentiality remains essential. The value of the right data being collected and analysed properly can be significant. Avoiding mechanical problems through early warnings of equipment failure can save substantial sums by preventing unplanned shutdowns.

Regulators and the public now require more information about how companies’ operations impact the environment are emerging at a rapid pace.

The value of a well-developed data strategy

A well-developed digital data strategy can therefore enable companies to deliver more value to customers and at the same time enhance their reputation.

GPDR may appear to be onerous for companies but regulations relating to personal data could increase further. This is not the case for operational data where both customer and society benefit are clearer.

The key challenge for data companies is to demonstrate meaningful benefits to customers. If not, they will be reluctant to share data. Doing this well, results in greater customer retention and brand loyalty.

Data is sometimes called the new ‘oil’. Oil was seen as a welcome and convenient development when it overtook coal as the largest source of energy. Oil companies became the most valued corporations on stock markets. Today, oil is seen as a dirty fuel and data companies have larger market capitalisations than oil companies. But data must avoid becoming today’s ‘oil’.

Companies need to ensure:

  • Clear communications of customer benefits
  • The technology needed is available
  • The data company has adequate analytical capabilities
  • The data provider agrees not to sell customer data to brokers