Digitization can derive value from data and solve global problems when done properly.
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- Unprecedented and recent challenges have hindered the world's ongoing fight against long-standing problems, such as climate change.
- Digitization and harnessing data can provide solutions to global problems more quickly and effectively than before.
- Many organizations lack the know-how to create value from disparate pockets of data and a new collaborative and "data first" mentality needs to take hold.
The world is at a critical inflexion point. We are in a time of heightened geopolitical, societal, environmental and economic uncertainty. The war in Ukraine upended the world's fragile economic recovery from the pandemic and has driven up energy prices, which could hinder global efforts to deal with the climate emergency.
But as these forces collide to create unique challenges, we have also seen a fundamental shift in the digital world that offers opportunities to solve societal problems and advance human progress.
We are in the midst of the transition from a centralized to a decentralized age of digitization, where intelligent and networked devices, machines, buildings and infrastructures generate unprecedented amounts of decentralized data rather than in a central data centre. This data holds an enormous potential to advance how we live and work – but we must unlock its value.
Creating value from data
Governments have recognized the transformative potential of data as a key driver of economic and social progress. And to accelerate the transformation, they are investing in the promotion of using data technologies and establishing frameworks and regulations to foster data sharing while protecting data rights.
But to what extent will organizations be able to take advantage of these measures? Do they have the strategic orientation, organizational model, technical capabilities and talent to capitalize on the opportunities presented? Can they thrive in what I call “The Age of Insight,” in which data insights and discoveries benefit all and elevate the greater well-being of every human on this planet?
A recent global Hewlett Packard Enterprise survey of more than 8,600 executives suggests that the answer to those questions is “no.” It found that the average organization’s data maturity score – or ability to create value from data – was only 2.6 on a five-point scale. This scoring means that not only are most organizations far from fully leveraging their data as a strategic asset but they also lack even the most basic capabilities to do so.
The survey reveals that these limitations hinder such organizations' ability to create key outcomes such as growing sales, innovating, advancing customer experience, improving environmental sustainability and improving humanitarian standards across their supply chains.
In other words, we are experiencing a new type of digital divide, where the majority of organizations are disconnected from the sources of future prosperity, while those that have taken a data-first approach continue to expand their lead.
Shifting digitization strategies
There needs to be more than government investment and policies to build organizational data capacity. Solving that challenge requires businesses and public sector institutions to put data at the centre of their digitization strategies. “Data first” must become the North Star of digital transformation – i.e. organizations must align their strategic, organizational and technological choices with the overarching goal of leveraging data as a strategic asset.
Winning organizations need to thus retain a high degree of control over their data and the means to create value from it. As the European Commission states in its Data Strategy, “currently, a small number of Big Tech firms hold a large part of the world’s data. This could reduce the incentives for data-driven businesses to emerge, grow and innovate.”
Achieving a high level of data maturity is the key to strengthening data control. Eventually, this means that organizations will become data platforms in their own right because of their ability to access, control, protect, govern and unlock the value of data, regardless of where it is generated and stored – in remote locations, across distributed devices and in data centres and clouds.
As we consider addressing the immediate risks we face while laying the groundwork for future opportunities, data must be at the centre of our thinking.”
The need for mature data capabilities
Data control does not mean organizations operate in isolation. On the contrary, data control is the prerequisite for collaboration across data ecosystems to achieve network effects while at the same time protecting privacy and sovereignty.
For example, think about hospitals around the world being able to share insights from sensitive patient data with one another to improve medical diagnosis – or government agencies collectively using artificial intelligence to predict and prepare for catastrophic weather events and climate change. That is how, in a fragmented world, we can drive cooperation toward solving problems large and small for the betterment of society.
New, decentralized data architectures that allow us to share data or insights from data are needed at scale across organizational boundaries and country borders without sacrificing data privacy and control.
In the meantime, the technologies and organizational models are available to reach that goal, including federated data spaces, data cooperatives or swarm learning. But, they can only bear fruit if organizations are equipped to take advantage of them. Organizations must control their own data to make it useful for others. And unless data becomes the critical driver of their value chains, organizations will not benefit from the cooperative’s data.
How can digital technologies help deliver the climate goals?
Prioritize ‘data first’
As we consider addressing the immediate risks we face while laying the groundwork for future opportunities, data must be at the centre of our thinking. We can leverage exponential data growth to advance economic and social progress like never before while at the same time promoting sovereignty, openness and equal opportunities.
Unlocking the transformative power of data will require organizations to put data value and control at the centre of their digitization strategies and align their organization, processes, technologies, skills and culture accordingly. It is a journey and there are no shortcuts but there are actions every organization can take to get going:
- Define a data strategy with clear objectives aligned with the organization’s overall goals.
- Assign strategic investments to data initiatives with endorsement from the most senior levels of the organization.
- Appoint a senior-level data officer with accountability for the data strategy.
- Create an effective architecture to manage data end-to-end securely.
- Start establishing the skills to master advanced analytics methodologies.
As leaders from governments, businesses and civil society gather in Davos this week, let’s empower individuals, organizations and nation-states to derive value from data in a responsible, collaborative, inclusive and sustainable way designed to advance human progress.
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The views expressed in this article are those of the author alone and not the World Economic Forum.
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