When companies talk about becoming data-driven, they’re really talking about having a single source of truth (SSOT). It’s the holy grail of today’s insight-driven businesses, and it promises to transform how every decision is made to give companies complete control over their competitive advantage. Here’s the only problem: Very few companies actually have an SSOT to rely on.
How few? It’s impossible to say for certain, but a recent survey helps shine some light on this problem. When 64 C-level professionals at leading multinational corporations were asked about their successes utilizing data, most offered a pessimistic portrait:
- 72 percent have not created a data culture
- 69 percent believe they are not data-driven
- 53 percent fail to treat data as an asset
- 52 percent are uncompetitive on data analytics
The reasons why companies fail to optimize data are complex, but most have a common source: disconnected data. In other words, many of the data problems companies contend with can be blamed on not having an SSOT to work with.
There was once a time when having an all-encompassing information resource was thought of as an exciting but impossible hypothetical scenario. Now that it’s reality, however, having an SSOT isn’t just advantageous, it’s becoming mandatory. To understand why, it helps to consider the link between expansive information access and effective business intelligence.
How Less Data Leads to Riskier Decisions
The term “data-driven decision making” is something of a misnomer. It implies that any decision informed by data is the correct one. Though it’s true that data improves decision making, it’s false to assume that actions based on empirical information always go as planned. In fact, some data-driven decisions are complete disasters.
Valuable as data may be, having an incomplete understanding of something is almost as bad as knowing nothing at all. For example, companies need to track their performance metrics closely. However, if all they have is the end metric and not the data behind it, they can’t explore what’s driving that metric in positive or negative directions. As a result, they might jump to inaccurate or ill-advised conclusions with unintended consequences.
Companies without an SSOT are often forced to make decisions based on incomplete, incorrect, or outdated information. They don’t mean to base their choices on a shallow pool of information. Rather, they are forced into this position because their data is scattered across files, departments, applications, and silos, even at companies with an ERP in place.
Most ERP products claim to create an SSOT by bringing all enterprise data under one umbrella. In practice, though, ERPs tend to be better at collecting data than they are at extending access to it. Users can find everything they need, but only after a lengthy effort to identify, locate, and integrate that information. In that way, ERPs offer sources of truth but fail to deliver it through a single access point.
Anyone involved with business intelligence forecasting, for example, understands the struggle of insufficient data. Predicting the future requires a lot of information, yet collecting it all takes more time, effort, and resources than companies may be able to invest. Since the future waits for no one, most companies can’t afford to delay producing forecasts, which is why many sprint through the process while incorporating the minimum amount of information possible.
No one believes this situation is ideal, and the data backs up that opinion. According to a recent Gartner assessment, 87 percent of organizations have low business intelligence and analytics maturity. Analysts point to a number of culprits, but topping the list is lack of visibility into trustworthy enterprise-wide data, meaning the absence of an SSOT.
Acknowledging the risk of continuing without a centralized data resource is important, but so is recognizing the benefits of seamlessly integrated information. Business intelligence forecasting improves with an SSOT, and does so more broadly, deeply, and dynamically than many expect.
Imagining an SSOT in Action
A single source of truth has two key features. First, it integrates data from as many sources as possible, automatically collecting updates and incorporating new information streams. Second, it makes data accessible to users through smart tools and intuitive features. For the purposes of business intelligence forecasting, think of an SSOT as a kind of oracle, delivering the best answer to any question.
No prognostication is perfect, however, and it would be a mistake to suggest that having an SSOT makes the perfect course of action obvious. What it does do is eliminate the issues that render decision-making uncertain and ill-informed, such as:
- Manual Inputs – Users don’t have to manually move data from one place to another when everything is automatically collected in one place. That saves a lot of time that the finance team or anyone else can apply to other aspects of business intelligence forecasting. It also minimizes the risk of human errors compromising data quality.
- Data Errors – Humans aren’t well suited to large-scale data management. That’s why manually manipulating data leads inevitably to errors and omissions. An SSOT is largely autonomous. Administrators define the outlines, but it’s otherwise self-sufficient. With time, that leads to improved data quality and eliminates the kinds of consequences that come from acting on faulty information.
- Incomplete Ideas – When it’s a huge effort to track down every piece of salient information for business intelligence, most people will be tempted to replace facts with guesses. Relying on an SSOT for reference does the opposite. When it’s quick and easy to access or explore information in-depth, users are encouraged to utilize as much data as possible.
- Miscommunications – Business intelligence is a collaborative effort. When stakeholders are relying on different sources for information, they may develop a widely different understanding of the facts. Since the SSOT serves as the one and only place people go for information, everyone utilizes the same data and miscommunications and misunderstandings become rarer.
Turning What You Have into an SSOT
More companies don’t already have a comprehensive database because historically, it’s been a huge technical challenge to build one. Fortunately, that’s changing rapidly with the advent of next-generation data tools like insightsoftware’s Jet reporting tools.
Built to integrate with Microsoft Dynamics and designed to run inside of Excel, the suite of Jet products offers a comprehensive data management solution for companies of all sizes across all industries. It incorporates numerous features, but all of them rely on the product’s unique ability to synthesize and streamline data. After implementation, users have immediate access to SSOT reporting capabilities as well as industry-leading tools for business intelligence forecasting.
If your data feels inaccessible and underwhelming as a result, the solution is simple. Contact us for more information about SSOT decision-making.