“Digital Transformation” is a popular catch phrase in many technology articles lately. But why is it so important? What makes a digital transformation imperative in today’s environment is preparing organizations to support their vision of the future, transform business outcomes in an agile and efficient way, and respond quickly to new digital disruptions.
One key component of the digital transformation imperative is data. Data is increasing at an unprecedented pace. Approximately 175 Zettabytes (one ZB is equal to a billion Terabytes) will be created by the year 2025, according to a recent IDC study, compared to 41ZB of data generated in 2019. Technologies such as The Internet of Things, artificial intelligence, and 5G have been catalysts for the growth of not only data, but also the growth of opportunities to derive new data-driven business value.
The starting point in using this plethora of data is creating a strategy for determining how the business model relates to its data. How can business outcomes be improved? What are the insights that that support better decisions? What business problems must be solved?
For companies that want to take advantage of artificial intelligence, data is the foundation of AI algorithms which unlock the hidden information and knowledge. The accuracy and usefulness of AI algorithms continues to improve as the amount of data increases. Search engines, such as Google and Microsoft, have generated an extraordinarily abundant set of image and text data which they have used to train AI models.
Inherent with the data strategy are several challenges. Often, organizations are not clear on what data it is storing currently and what, of that data, is actually valuable. In addition to data analysis, decisions must be made regarding cleaning, formatting, translating, storing, and security, each of which adds to the value in supporting the organization’s desired end results.
Ultimately, a comprehensive focus on data as the foundation of its digital transformation enables organizations to take advantage of new business opportunities and deliver faster and more informed decisions, improved customer service, and increased productivity.