The Essence of DX Vol. 3: Organizing Dark Data Promotes DX

On average, 57% of data held by companies is "Dark Data" that remains unused.

Data built by companies can be broadly categorized into the following three types.

• Clean Data: Data that is determined to be valid and can be utilized for business.

• Dark Data: Data that was temporarily useful but is now stored without its value being recognized.

• ROT Data: Redundant, Obsolete, and Trivial data.

According to an article in the Nikkei on July 4, 2020, an average of 57% of data held by companies is considered "dark data." In addition, a significant amount of ROT data exists within organizations. Leaving these unaddressed leads to various negative factors, such as increased storage costs and the risk of brand damage due to data breaches.

As a precursor to achieving DX, digitalization is accelerating, and companies are creating and storing data at a rapid pace. In B2B sectors particularly, data accuracy and freshness are easily lost due to factors such as company name changes, relocations, bankruptcies, and mergers, leading to an increase in dark data and ROT data, which results in unnecessary costs.

Building a data infrastructure for ROD offers greater cost benefits.

Many companies assume that building an infrastructure to perform ROD to prevent the creation of dark data is prohibitively expensive. While it is true that labor and processing costs for data maintenance are increasing, the evolution of IT technology has simultaneously reduced the actual cost of data retention.

uSonar performs daily data maintenance. In 2019 alone, there were 91,104 company name changes (including business locations) and 159,581 address changes. Since company name changes, relocations, and bankruptcies occur daily, handling these manually is impractical. While irregular, spot-based data maintenance is effective, data is constantly changing; therefore, building an infrastructure that performs automatic, real-time maintenance is more cost-efficient in the long term.

To achieve DX, it is essential to utilize organized data in real time. Building an infrastructure for ROD to prevent the creation of dark data not only improves operational efficiency but also serves as a means to enhance the overall competitiveness of the company.

Case Study 1: Major System Integrator

A major system integrator, which is part of a large corporate group, provides services ranging from consulting to operations on a one-stop basis. The company focuses on inside sales to create business opportunities that lead to negotiations and needed to utilize precise data to analyze the number of prospective customers and generated projects. However, because registration and change requests from sales representatives were processed manually, time lags occurred.

Therefore, the company introduced a data integration tool and linked it with e-Sales Manager (SFA) to achieve automatic maintenance for company name changes, address relocations, and more. As a result, the company reduced the costs and man-hours previously spent on maintaining data freshness, creating an environment where they could focus on inside sales. Furthermore, it became possible to calculate metrics based on accurate, real-time data, leading to the optimization of process management.

Case Study 2: Contract Software Development Company

At a major contract software development company, data was scattered across various departments and campaigns, hindering effective sales coordination. Because data maintenance was performed manually, the operational burden was significant, creating an environment prone to the accumulation of dark data. Consequently, this slowed the pace of business development.

By implementing a data integration tool, the company automatically consolidated data scattered across departments to build a master database. Furthermore, they achieved the automation of data maintenance. As a result, the 26,200 annual hours previously spent on data entry and maintenance were reduced by 51%, leading to a total reduction of 13,300 operational hours. The time gained has been utilized for the development of new business models and services, enabling both operational efficiency and innovation.

Integrating and Utilizing Online Data for a Data Infrastructure Focused on ROD

Automating data maintenance to convert dark data and ROT data into ROD is crucial for driving digital transformation (DX) smoothly. However, to truly realize DX, it is necessary not only to organize data but also to actively utilize that data to extract value.

In B2B digital marketing, research by Gartner has revealed that the majority of the purchasing process is completed before a sales representative even makes contact. By capturing potential needs through corporate websites and online channels, and by analyzing the behavior of prospective customers, companies can implement more precise marketing initiatives. This requires an environment where online data can be integrated and analyzed in real time.

By strengthening the ROD infrastructure, it becomes possible to utilize online data for targeting and predicting customer purchase intent, thereby providing a consistent customer experience from marketing through to sales. Furthermore, by linking data acquired online with offline customer data, complex analysis and the acquisition of more sophisticated customer insights become possible. This allows companies to design optimal approaches for each customer and execute efficient sales strategies.

By leveraging a robust data infrastructure, companies can move beyond mere information retention, enhance their competitiveness through real-time data utilization, and achieve sustainable growth in their DX initiatives.

Summary

It is critical for corporate DX initiatives not to neglect dark data or ROT data, but rather to maintain them appropriately and practice Return On Data (ROD). By establishing a solid data infrastructure and automating daily data maintenance, companies can simultaneously achieve cost reductions and improvements in operational efficiency.

Furthermore, refined data generates new value in marketing and sales activities, serving as a key factor in enhancing competitive advantage. By strategically leveraging data, you can achieve true success in digital transformation.

Next Article

The Essence of DX is a four-part series.
You can view the next article here.

The Essence of DX Vol. 4: What Are the Data Utilization Methods to Accelerate DX? ▶