Data Utilization in Business: Essential Processes and Challenges to Address

Organizing, Distinguishing, and Updating for Corporate Data Utilization

By creating integrated data, companies can not only execute efficient marketing initiatives based on appropriate STP analysis (*1), but also manage information to conduct sales approaches aligned with customer status and implement retention strategies.

However, the challenge is that data cannot always be collected in a "pristine state." Taking corporate data (company names) as an example:

• Names become outdated due to mid-term name changes resulting from business integrations.
• Name changes occur for the purpose of strengthening branding.
• Abbreviations become generalized, leading to discrepancies between official names and input information.

These issues make it difficult to identify where the "latest information source" is located within the company. [As an aside, companies like Dropbox in the U.S. refer to this "latest information source" as a Single Source of Truth (SSOT) (*2).]

The necessary tasks to make data easier to handle are "Organizing," "Distinguishing," and "Updating." In the specific process for the company name example mentioned above, the following tasks occur continuously:

• Organizing
  • Consolidate Duplicate Corporate Information Into the Official Name.
• Distinguishing
  • Delete Outdated Information.
  • Separate the Latest Information.
• Updating
  • Append the Latest Information to the Consolidated Company Names.

By "Organizing," "Distinguishing," and "Updating" data to create "pristine" integrated data, it becomes easier to add not only internal data but also a greater volume of third-party data.
By appending information that the company previously did not possess, it becomes easier to gain deeper insights into customers, which is said to enable the design of more concrete sales strategies and marketing initiatives.

*1: Abbreviation for Segmentation/Targeting/Positioning. One of the representative frameworks in marketing.
*2: Reference URL

Four Challenges for Companies Leveraging Data

Analyzing the results of the 2020 survey by the Ministry of Internal Affairs and Communications on the measurement and current status of the economic value of digital data (Note 3), it can be inferred that many B2B companies are failing to implement integrated data utilization strategies such as "forecasting" or "AI utilization," and are continuing to operate without integrating flawed information.

The causes of this situation are common to many companies and are known as "Data Utilization Challenges."
Specifically, they consist of the following four items:

1. Integration and Correction (Data Quality Management)

If a company assumes that all the data it collects and holds is correct, its data utilization efforts will stall. As noted in the example of company names, it is necessary to adopt the perspective that outdated or inaccurate information is mixed in.
By creating a management system that distinguishes between necessary and unnecessary data from the data held by the company, it is possible to improve data quality and establish a system for faster, more accurate decision-making.
In the United States, it is said that the average annual loss for companies due to poor data quality reaches $10 million (Note 4), which has led to the widespread adoption of data quality management concepts driven by technology.
In Japan, data quality management is also considered an important corporate task, and a guidebook (beta version) has been released by the Government CIO (Note 5). However, because data quality management involves significant changes and resistance, such as the introduction of complex tools and the renewal of workflows, the current situation is that many Japanese companies are not progressing as they would like.

2. Augmentation and Standardization

There are other positive effects of improving data quality. It ensures greater "data integrity." In particular, when performing "data augmentation," such as adding more information using third-party data, being able to prepare high-quality, up-to-date data without notation variations is a major advantage.
Most providers of third-party data excel in data updateability. Conversely, this means that old data and incorrectly formatted data are quickly removed from their databases.
Furthermore, third-party data is not perfect. There are providers that have less comprehensiveness in exchange for strengths in updateability. To maximize the use of data from providers that offer the latest data under specific conditions (e.g., limited to listed companies or industry-specific), it is important for the recipient to also maintain accurate data.
To maintain accurate data, it is necessary to establish standard data formats. This standardizes the rules for how data is collected and held. It is also important to visualize which parts of the format can be collected by the company alone (and which parts will result in missing data) to understand what kind of augmentation data is required.

3. Workflow Organization and Adoption

Even if you prepare an environment for accumulation, it does not mean that you are ready for data utilization.
As mentioned at the beginning, it is necessary to establish an environment where collected data can be easily referenced.
By defining certain reference rules and ensuring that everyone in the company complies with the usage methods according to those rules, you can maximize the resources of the sales and marketing departments to collaborate on lead acquisition and customer satisfaction improvement, thereby maximizing the company's revenue.
Specifically, you can collaborate on activities such as extracting company lists from high-quality data collected inside and outside the company based on conditions like "ideal customer profile," "high-potential customers," or "customers with high similarity in corporate attributes," and further narrowing down the targets to approach by looking at recent behavioral data (interests) and published content (news).

4. Building and Operating a Cloud-Based Data Utilization System

Speed is required in the environment where data is referenced.
If you say, "I was able to extract the data easily, but it was information from two weeks ago," you cannot approach customers in a way that exceeds their expectations.
Although the sales and marketing departments lead the list creation using data, they cannot handle fresh data with analog methods.
This is where cloud-based data utilization solutions become necessary. The cloud's strengths are the speed of reflecting and extracting updated data, and it enables multiple people to work simultaneously. In addition, since settings can be saved for each individual user, it leads to labor-saving and efficiency in routine work.
There is also a secondary benefit in that communication between the IT department and the sales/marketing departments can proceed speedily, as data linkage with tools such as MA and CRM that actually create and manage customer touchpoints can be performed smoothly.

To solve all "Data Utilization Challenges," it is important not only to organize data within the company but also to select third-party data providers based on specific criteria. A cloud service that combines "updateability" and "comprehensiveness" and has a proven track record of integration with MA and CRM is desirable.

Note 3: Reference URL Note 4: Reference URL Note 5: Reference URL

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Summary of Points: Necessary Preparations for Building a Data Utilization System

The following points are considered important for maximizing the use of first-party data and third-party data.

First-Party Data

• Always manage the latest data
• Eliminate notation variations and duplicates
• Manage with a single tool and a single format
• Create an environment accessible to everyone in the company
• Identify content that tends to be missing

Third-Party Data

• Use for augmenting first-party data
• Select providers with high updateability and comprehensiveness
• Providers offering cloud-based services are preferred

By being conscious of the above points, data utilization in companies will become more sophisticated.

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