Data Cleansing Combating the Cost of Bad Data
July 9th, 2019 | Savant Fernandez
Businesses around the world recognize the importance of data when it comes to understanding their customers and taking strategic decisions for enhanced ROIs. However, in the scramble to be personalized, they disregard crucial facts about data quality which lead to incorrect analytical insights and wrong business decisions. According to Gartner, “The average financial impact of poor data quality on organizations is $9.7 million per year.”
The quality of data can be improved by ensuring correct data entry points, effective data consolidation, data standardization and data cleansing solutions. Effective implementation of data cleansing and enrichment techniques can help to create, validate, update, enhance and enrich business-critical data by developing custom tools (spiders, bots, and scripts) and manual processes.
In this article we will take a look at:
- How bad data impacts your organization
- How your organization can deal with bad data
- Specific benefits of deploying data cleansing and standardization processes
Fix your data quality issues now!
How is data quality affecting your organization?
With the onset of big data, every organization has adopted various data collection techniques. They have realized that fact- based strategic decisions based on accurate data yield much better results than decisions based on extrapolations and assumptions.
What marketers don’t realize is that bad data costs a company much more than they can think of.
- Financial costs: Ovum Research reported that poor data quality costs businesses at least 30% of their revenue.
- Productivity costs: Incorrect sales data pushes sales persons to waste their time on dead leads or leads with zero returns. Inaccurate data can lead to skewed business strategies.
- Missed market opportunity: MarketingSherpa found that every year 25-30% data becomes inaccurate. Bad data can give misleading information about customer demographics and spending behaviors, which would lead to missed opportunities for marketers.
- Damaged brand image: Miss-communication is a huge turn-off for customers. Bad data can lead to wrong messages getting communicated to customers, a sense of dissatisfaction among them and even negative branding on social media.
How can your organization deal with bad data?
Improving data quality can be a daunting task but not impossible. It is critical to analyze the lifecycle of data in your company to know where all you need to make changes to improve data quality. This can be done by having correct data entry points, ensuring proper data consolidation and implementing effective data cleansing techniques.
The data cleansing process helps you to de-duplicate, validate or delete incorrect data which has crept inside your organizational database. It would also help in collating information from various platforms of different formats and help in structuring them into a common standardized format.
Data is constantly decaying so it becomes critical to cleanse the data at regular intervals for an accurate database.
Hence, it is smart to automate your data cleansing process through custom made tools which have preset data cleansing and data matching scripts to ensure automated cleansing of your business critical data.
Houston based Hotze Health & Wellness Center achieved a dramatic turnaround in their customer satisfaction levels by deploying a series of data standardization and cleansing processes.
Operations at this health clinic leveraged on a huge and highly dynamic database of patient records and research. The nature of business and the need to migrate this dynamic data to a new CRM platform made it prone to errors.
Effective data cleansing and enrichment techniques helped the company meet the challenges of generating accurate and reliable records and profiles of every client in their database. Effective customer management and a high customer satisfaction index were assured.
There are many data cleansing solutions available today. Tools and software are available to get it done in-house but it would mean hiring new resources, investment of resource time, hardware & software costs etc.
Hence, the prominently used solution is outsourcing to a data cleansing solution provider. There are a range of benefits in outsourcing data cleansing to a solution provider as the company can focus on its core business activity, no need to install a setup or buy software or hire resources for the same.
Moreover, through years of working on similar projects they have the right processes and resources in place to implement data cleansing with speed and accuracy. Scalability is another benefit provided by such solution providers, as they have the ability to increase or decreased the employees working on a particular project based on the client’s requirement. It is important to find the right solution provider who fits your organizational requirements.
A leading specialist advisory firm in economic development needed to verify 28,000 records with more than 80 fields: gathered from various data sources & wanted it to be prepared to be sold to government for FDI (Foreign Direct Investment). There were a range of challenges in the project like various data sources contained different information, information was available at different sources in different formats etc.
Data Cleansing followed by standardization was done for detailed company descriptions which assisted the client in achieving a single customer centric investment portfolio. Macros and bots were created to verify the available information. All this led to the client getting the BID for supplying data to government agencies.
Benefits of data cleansing
Effective data cleansing and standardization provides a range of benefits to an organization ranging from financial savings to increased productivity.
01. Reducing overall cost for the company
As we saw earlier, bad data costs a company about 30% of their revenue. Implementing data cleansing strategy would save much more for the company on the financial front.
Here is a comparison of the cost of bad data v/s cost of implementing data cleansing. It clearly shows how an organization would benefit much more despite of bearing the cost of implementing data cleansing solution.
02. Finding the best customer & capitalizing on market opportunities
One crucial impact that clean data will have on your marketing strategies is that it will give you the perfect customer profile to target your products. Clean data will give you a better insight into who your loyal customers are and what they need. This would help in formulating effective marketing campaigns to target the right customers.
03. Enhanced productivity
The sales teams will not be wasting any more time on dead leads or calling on non-responsive customer contact numbers as all those problems would have already been sorted. With the right information at their disposal, the sales force can focus their efforts on the right customers to attain maximum output. Moreover, the resources who were tied down with collating and cleaning data manually can also utilize their time on business oriented activities. Thus, outsourcing data cleansing can save your resource time & enhance organizational productivity.
04. Un-wrangling data silos
Data silos are a very common problem in organizations because of departmentalization. Departments only collect or clean data which are relevant to them & do not bother about the rest of the information. Data cleansing techniques can understand correlation between the same information provided by different departments, can complete them increasing its accuracy.
05. Improved brand image and competitive advantage
With right data, a company can provide its customers with quick responses to their problems and also a close to perfect after sale service. Such response from the company elevates the image of the brand in the minds of the customer. Moreover, knowing your customer profile to the core will give an added advantage compared to the firms who are still working on outdated data.
To have ideal insights from business-critical data, it is essential to upgrade and maintain the data on a regular basis to keep it up-to-date and relevant. Stale data can end up giving the wrong insights about the market, customer profile and also waste a lot of resource time. Data cleansing will help you keep the data updated and help in forming right business strategies to touch the customers at the right spots generating ideal results.
Outsourcing the data cleansing process to a data outsourcing service provider can solve all your problems efficiently and effectively.
can do for your business.