COVID-19 led to a digital acceleration in the workplace. In Australia, one-third of businesses expanded their online presence in the first three weeks of the pandemic, and 90% adopted new technology to support business continuity.
Data played a critical role in the pandemic response by providing a means for organisations to make informed decisions—from vaccine development, customer sentiment and engagement, inventory and sales management, and employee safety. But despite the growing importance of data, Demystifying Data 2021, a new report commissioned by Amazon Web Services (AWS) and prepared by Deloitte Access Economics, reveals that most organisations in Australia and New Zealand (ANZ) are struggling to improve data maturity. Data maturity refers to the extent to which an organisation uses the data they produce—the more organisations do with their data, the higher they are on the data maturity scale.
The report surveyed 500 ANZ organisations that employ 100 people or more, and measured data-maturity levels using a five-point scale—from basic maturity (no data strategy; not capturing or analysing data) to mastery (firmwide data strategy; analytics embedded frequently into decision making). Despite data’s increasing importance, 62% of organisations in Australia and New Zealand reported that they had only basic or beginner data-maturity levels, and only 16% reported advanced maturity or data mastery.
Measuring the impact of data maturity
While measuring the impact of data maturity on business outcomes can be challenging, small steps along the way can generate large paybacks for organisations and their customers, and create a positive impact on our economy.
Moving up one step on the data maturity ladder could lead to a 6.7% growth in annual business revenue. For the average business with 100 or more employees, this is equivalent to AU$850,000 in additional revenue for Australian businesses and an increase of NZ$870,000 for New Zealand businesses.
For larger organisations, the opportunity significantly increases. For businesses with 200 or more employees, the average revenue in 2020 was AU$401 million and NZ$259 million. A one-point increase in data maturity could contribute to an additional AU$27 million and NZ$17 million respectively each year.
Many organisations are aware of the impact that low data maturity has on their operations. One-third of businesses cited delays in decision making as the biggest impact from not embracing data.
Unlocking the machine learning advantage
Data maturity is one of the core requirements to unlock the benefits of advanced technologies such as artificial intelligence (AI) and machine learning (ML), which can help organisations solve even bigger data challenges and automate decision making.
The report found 97% of businesses that implemented AI and ML gained benefits, despite being in the early stages of their journey. The main benefits identified were cybersecurity, fraud detection, financial services, intelligent document processing, and improved customer experience.
Looking forward, more than 50% of businesses expect to have higher levels of AI and ML maturity in the next five years as they look to unlock productivity benefits, drive innovation for customers, and deliver economic outcomes.
Creating a roadmap to improve data maturity in ANZ
Previous research commissioned by AWS and prepared by AlphaBeta predicted that advanced cloud computing and data skills will see the largest increase across all digital skills in Australia by 2025. The number of workers needing these skills is expected to triple over the next five years.
Organisations have two options to develop their data capabilities—build or buy talent. That is, they can build the skills they need with the team they have, such as through on-the-job training. Or, they can buy skills through recruitment drives, targeting their current skills gaps.
A quarter of organisations in the Demystifying Data 2021 report stated that they plan to upskill their own staff to grow their data capabilities, which is paying off. Over a third of businesses that are already upskilling current employees reported advanced or mastery levels of data maturity on average, compared to just 14% across all surveyed organisations.
However, 54% of businesses still plan to hire or outsource skilled staff to grow their AI, ML, and data analytics capabilities.
Turning to ML to drive a customer-centric culture at Officeworks
According to Australian office supplies company Officeworks, customer personalisation has become even more critical in the past 18 months as a significant share of Australians began working from home due to COVID-19 restrictions.
To understand customers better and provide access to the necessary equipment for a new work environment, Officeworks engaged Deloitte to build a cloud-based product recommendation platform leveraging AWS. The platform provides a 360-degree view of Officeworks customers and draws insights that help to deliver a personalized experience across the online customer journey.
Using Amazon SageMaker (a fully managed service that helps data scientists and developers to prepare, build, train, and deploy high-quality ML models quickly by bringing together a broad set of capabilities purpose-built for ML), Officeworks can analyse data, such as previous purchasing history, product preferences, and product characteristics, and then provide relevant recommendations to customers when they shop online.
“We knew we had to create a companywide mindset shift from being product-centric to customer-centric,” said Revital Rosenberg, Head of Data, Analytics, and Insights at Officeworks. “The ability to understand the shifting needs of our customers and then tailor our offerings builds more trust, particularly during times of uncertainty.”
Personalisation through relevant marketing offers, website recommendations, and strategic decisions that are inclusive of the customer preferences is creating better customer engagement and building long-term brand loyalty with Officeworks customers.
To drive this personalisation journey, Officeworks focused on building the right skills and capabilities in both its technical and nontechnical teams. The organisation also hired new talent and provided existing employees opportunities to develop their data capabilities.
“Our goal is to help technical teams hone their skills, while building cloud capabilities across the business to deliver a better experience for our customers,” said Rosenberg. “Over the last 12 months, we ran a comprehensive formal and informal training program, which included lunch-and-learn sessions and hands-on workshops with AWS for Officeworks employees.”
As flexible working options increase, personalised online customer engagement will continue to be a focus for Officeworks.
“People have repurposed their homes to be their offices and creative spaces. We are focused on generating as many insights as we can and ingesting more data into the platform so that we are ready to respond with the right solution quickly as the needs of our customers change,” said Rosenberg.
Mastering data maturity
Research shows that many organisations consider themselves to be in the early stages of data maturity. Fortunately, improving data and analytic capabilities might not require significant changes to ways of working or extensive funding.
One way to improve data maturity is to engage senior leaders to champion growth in data analytics and invest in upskilling current staff.
In addition, organisations that have a well-defined, firmwide strategy for using data are more likely to invest in their data and analytics capabilities. In fact, these organisations are 20% more likely to invest in data collection or analytics tools, 40% more likely to train existing staff in data and analytics, and 50% more likely to have invested in AI or ML capabilities, compared to organisations that do not have a firmwide data strategy.
Finally, organisations should identify opportunities to improve their data management and data quality. They should consider investing in cloud technology to accelerate growth and unlock emerging technologies, such as AI and ML.
Read the full Demystifying Data 2021 report.
Read more about the launch of AWS Data Labs in Australia and New Zealand.