By: Nikola Hopkinson, Content Manager, ADMA
The rapid advancement of technology has had a profound effect on customer expectations. With an abundance of choice, customers are in the driver’s seat forcing businesses to turn to data-driven strategies and customer-centric approaches to meet their expectations.
Data plays a central role in customer experience and driving value to customers – a topic which was explored at ADMA’s Data Day during a keynote presentation by Ram Kumar, Global Head of Data Strategy and Governance and Head of Data and Analytics at QBE Insurance. Internationally recognised, Kumar has over 18 years of data experience, spanning lifecycle management, including privacy and ethics, and advanced analytics for structured and unstructured data. Kumar also has over 28 years of experience in IT.
Kumar realised early on that a lot of organisations were focusing on technology, process and people without a clear focus on data – which lead to poor outcomes.
“It is the data that brings technology, process and people together by serving as the “common denominator” to drive business outcomes. This is why data is called the “lifeblood” of an organisation – it fuels people, processes and technology. Without data, you do not have a business,” says Kumar.
Organisations have since caught on, and the ‘data and analytics revolution’ is taking industries by storm globally. But in order to drive and lead effective data driven initiatives, data governance is crucial, according to Kumar.
“Governance of the lifecycle of data is therefore critical for effective and efficient business operations using data driven insights. Data Governance is about a journey of cultural transformation – changing people’s mindset about data and this excites me,” he adds.
In the lead up to Data Day 2017, we sat down with Kumar to pick his brain on data governance and data’s role in customer experience.
1. Why is data governance important?
Data is the strategic and competitive asset of an organisation. An organisation might have the smartest and most efficient business processes, highly capable and smart staff who can derive the best data driven insights, and best in class technology and operations, but if the underlying data that touches people, process and technology is poor in terms of its quality and integrity, the outcome will be poor. Dirty data will stop digital transformation and most other business transformation efforts from being successful. If you want trustworthy, reliable and quality data along with effective and efficient data risk management practices to maximise the generation of sustainable business value out of data, effective and efficient governance of the lifecycle of data asset is critical. Data governance is a program that brings people, process, and tools together to make the data work for the business. Data governance should not be seen as a project. Data Governance program does not have an end date as it governs the “strategic asset (Data)” that continues to grow in an organisation for effective and efficient use to create value to the business.
2. Data governance is feared to inhibit data analytics – how can we make sure that governance allows data analytics to continue to grow?
The word ‘governance’ is often seen as painful, bureaucratic and boring. The purpose of data governance is to help manage the lifecycle of the critical data asset through a minimum set of standards and policies that would assist in exploiting the data in a manner that would generate appreciable value to the organisation and to its customers, partners, employees and shareholders. This is where it is critical to have metrics in place to measure and demonstrate the value of data (through data governance) to the business. This is a cultural challenge and it can neither be addressed overnight nor can a ‘big bang’ approach work.
To gain momentum behind data governance, organisations should identify critical and visible data analytics business projects that would generate quick wins and support the project by applying the “right” level of data governance on critical data elements to demonstrate benefit and value to the business in a timely manner. “Right” level means allowing data scientists to explore and experiment with data but within the allowable data risk appetite when it comes to deriving value to business, customers and partners. This is critical to help people recognise that data governance is not a barrier to business initiatives, but an enabler that would help make informed decisions by managing key data related risks in a timely manner. The efficiency of the governance process is critical to this.
3. What is the role of data in customer experience?
Organisations/Businesses that want to differentiate themselves from their competitors in terms of customer experience need to first understand their customers deeply using the data asset they have about their customers (e.g. complete and consistent view of customer) before they could provide superior customer experiences that would have a powerful impact on the customers. This is where data plays a critical role in telling a story and the story of the customer if businesses explore the data effectively and efficiently. Acquisition, conversion, retention and experience are critical components of a customer lifecycle and data plays a key role in this. Data allows you to better understand the needs and the actual behaviour of customers throughout their journey with the organisation, but also their feelings for each major step of their journey with the organisation such as research, consideration, preference, purchase, satisfaction, recommendation, etc.
Organisations aiming to be customer centric must focus on building data driven customer experience by placing customer at the “centre” of their business strategy supported by products, processes, data analytics and technologies. But too often the priority for organisations is driving operational efficiencies over customer centricity and as such brands continue to be built upon products rather than the customer
4. What do you think the future holds for data and analytics?
I sincerely believe we are only in the beginning of data revolution era. The real power of data and analytics will be realised when it will change the way we run our lives. Data and analytics will be expected to be a norm in the future to run our day to day lives with data driven intelligence on everyone’s smart devices, homes, vehicles, appliances, etc. with personalised intelligent information tailored to individual’s lifestyle, behaviours, affordability, preferences, habits, health, needs, etc. Organisations will treat data as a capital asset and its business processes, technology and operating model will be centred around data. Organisations will define data monetization (through internal and external means) as a key KPI in their corporate balance sheet where financial and business value that data brings to the organisation will be measured and tracked. Data risk will be a key and critical KPI the enterprise risk profile of an organisation.
While the future of data and analytics looks promising, as data driven intelligence reaches customers, data privacy and ethical use of data will continuously challenge and put pressure on law and regulations to catch up and this will be a subject that will be highly debated and discussed in the future. Finding the right balance between Privacy and ethics ‘vs’ innovation and customer experience will be a hot topic of discussion. Data management and effective and efficient use of data will also determine an organisation’s success in implementing an effective digital transformation particularly when providing digital experiences to customers across multiple channels in a consistent manner.