People-centric data strategies: five steps to achieve
Organisations have undergone a significant evolution in their use of data this past decade.
Where mitigating risk was the main focus, the C-suite priority has turned to empowering the workforce to extract greater value from data.
New research from Qlik and Accenture looking at the Human Impact of Data Literacy revealed the majority of global employees are now expected to read, communicate with, and use data to inform their decisions on a weekly basis.
However, many companies struggle to close the gap between this vision and the workforce’s ability to deliver on this in practice. An Accenture study from last year found only 32% of business executives were able to realize tangible and measurable value from data.
To harness data’s potential, here are five practical steps any enterprise leader can implement today:
Appoint a data champion responsible for delivering tangible results
To identify opportunities that align and tangibly impact the wider company objectives, the C-suite must appoint a data champion, typically a Chief Data Officer or the Chief Information Officer. They must act as a data ambassador across the organization, working with stakeholders to identify opportunities to maximize data use, along with executing a change management plan to transform processes as needed.
Just as you wouldn’t commit to organizational restructuring without a thorough analysis, you can’t embark upon a data strategy without an accurate understanding of the current state of data-informed decision making across the business.
Work with senior stakeholders of each department and the data champion to understand whether every employee has access to the necessary data and tools, along with assessing current and ideal data-related skill levels for every role.
Give people the right tools for the job
Work with the Chief Information Officer to ensure the data tools serve the needs of each user. Not only will these tools look different across skill levels, but they must be easily integrated into existing working practices to encourage adoption.
Invest in upskilling your workforce
The true benefits of data are realized when everyone in an organization is comfortable and confident using data. Yet, we’re facing a significant data literacy skills deficit: just one-fifth of the global workforce report they are confident in their ability to read, communicate with and make decisions using data.
While data literacy training is a critical investment for enterprises, just one-third of executives of global firms previously reported their company provides it. As such, it presents an opportunity for market differentiation to improve the firm’s competitive edge.
Move with the opportunity
To better inform process and decision making, leaders have two critical responsibilities: first, they must ensure this process becomes ingrained in the organization’s DNA so data is always used effectively to improve competitive advantage. Second, they must ensure employee skill levels, access to data and tools are continuously reassessed to ensure they deliver on new opportunities.
M&A activity key lever for future tech sector growth
Despite the continuing uncertainty of the pandemic, the tech sector has witnessed soaring dealmaking activity over the past year, rocketing in the second half of 2020, with the last quarter of 2020 a record one for M&A activity, and momentum continuing into 2021.
Dealmaking in tech sector soars in past year
And the latest figures bear this out with the number of technology M&A deals totalling US$208.44bn globally in Q1 2021, according to GlobalData. While the US holds top spot both in volume of deals (1034) and total value (US$140.61bn), Europe ranked next with 649 deals (US$44.49bn) with the UK continuing its reign as Europe’s biggest M&A market with 204 deals.
In particular, megadeals – those valued at US$5bn or more – soared in 2020 representing 59% of all global technology sector deal value in 2020, up from 47% in 2019, according to the latest edition of the EY Technology Global Capital Confidence Barometer.
This tech sector trend towards megadeals is backed up by EY’s CCB data, with 16% of tech sector respondents planning to pursue transformative deals valued at US$5bn or more in the near-term.
While technology deal activity “all but stopped at the beginning of 2020 after fluctuating between historic highs and lows, companies pivoted quickly and tech M&A exploded in the second half of the year”, says Barak Ravid, EY Global TMT Leader for Strategy and Transactions.
M&A activity level for tech sector growth
Looking ahead to the future, technology executives are optimistic, with nearly half (47%) expecting profitability to fully rebound this year, according to CCB data, compared to 23% across all sectors, and with more than half (51%) planning to pursue M&A in the next year in order to sustain growth.
According to Ravid, M&A activity is increasingly becoming a key lever for growth as businesses look to recover.
“To position themselves for future revenue growth, tech companies are now adjusting their M&A strategy to focus more on a target’s business resilience, digital technology alignment and to gain market share through consolidation,” says Ravid.
However, with an increasingly competitive deal market and ongoing geopolitical tensions, the majority of tech execs expect to see more competition in the bidding process for assets over the next year, primarily from private capital.