Emerging technologies, from AI and machine learning to edge computing and the metaverse, are fundamentally revolutionising how data is captured and used by businesses in the UK.
The effective application of this data can have a transformational effect on the performance of an organisation. In the UK, we’ve had clear examples of this working to great success. McDonald’s, for instance, used visitor data to assess the effectiveness of its iconic Piccadilly Circus billboards, and redirected marketing spend towards smaller, personalised adverts instead. This increased footfall to desired locations, and ultimately, drove up sales.
But an alarming number of organisations still find embracing data hard, making it difficult to bridge the gap between innovation and execution. Complications like a lack of technical skills, rigid legacy infrastructure and non-uniformity in legislation have prevented firms from harnessing the potential transformation that data can inspire.
In fact, the overabundance of data has been cited as a leading factor preventing organisations from becoming more data driven. Many British C-suite leaders fear having to hold and process huge volumes of data, due to the risk of regulatory breaches and heavy fines. As a result, Deloitte predicts that the proliferation of data will be a significant challenge to business innovation in the next three years.
To overcome this challenge and drive business success, organisations need to be brave and put data first. This means building sufficient infrastructure to capture and process data, having strong security measures to reduce the risk of regulatory breaches, and using these insights to inform business strategy. From there, organisations can begin to reap the financial and strategic benefits presented by data. Failure to do so can have catastrophic effects on a business’s long-term viability.
The UK has had many recent reminders of this, with a plethora of iconic businesses collapsing due to a lack of innovation – from Woolworths and BHS to Debenhams only last year. Each of these organisations lacked differentiation in the market and failed to account for the switch to online shopping. By relying on outdated business models and failing to use data to contextualise how shopping habits had changed, these companies failed to innovate sufficiently.
Compare this with the fortunes of John Lewis, who has embraced data heavily as part of its famed omnichannel strategy – with bricks-and-mortar stores complementing its online offering. Pre-pandemic, the retailer announced profits of £160m, and recently moved into the ‘build-to-rent’ property market, leveraging soaring private rental demand in key UK cities to provide a new stream of income.
The majority of business executives believe organisations that are prioritising data-led decision making are stealing market share, according to new research that I produced in collaboration with VMware. Fifty-eight per cent fear they will fall behind if they don’t make better use of their data.
Businesses are recognising that data is crucial to understanding the needs of their customers, bringing new products to market and ultimately to their own survival. Innovation is no longer a choice. Leaders need to focus on creating environments where data can flourish. This will require continual financial investment, no matter the economic pressures or other perceived priorities, but it will pay off in the long-term.