Business chiefs 'must deploy data to fight disruption'

Data insight may have expanded from the marketing department to drive nearly all business operations, but bosses are being urged to go further and use data to better understand disruption and boost their resilience to instability.

That is one of the key recommendations of a new Dun & Bradstreet report, which reveals the top challenges facing businesses this year – in the UK and globally – and where firms may be falling short when it comes to finding the insights that help protect themselves.

With business collapses and layoffs becoming commonplace across once flourishing industries, the report says it is evident the world is currently facing hyper-disruption: a series of crises happening in tandem, ranging from soaring energy costs to economic instability, all impacting businesses and leaving them at a loss for which disaster to prioritise first.

It cites the recent collapse of Silicon Valley Bank, which, it claims, clearly demonstrates the impact that one link in the crises supply chain can have on a whole host of industries and individuals. However, the report maintains that businesses can spot and evaluate risk through the use of high-quality data and learn to become resilient in the face of volatility.

Key findings of the Business Resilience report – which surveyed over 3,396 business across the 18 countries – show that almost half (43%) of global business leaders see energy price increases as their biggest challenge for this year, despite Western efforts to impose energy spend caps over the winter months.

They also cite weakening customer demand (25%), cyber security (24%), increased taxation (24%), and access to talent (20%) as other major challenges for this year.

In addition, the overall increase to the cost of doing business is expected to have an acute impact on more than a third (37%) of firms.

Yet it seems many businesses are unaware of how to actively minimise risk and boost resiliency. In fact, only a quarter (27%) of leaders rate their business’ resilience during turbulent times as “extremely resilient”.

Even so, nearly eight in ten (79%) business chiefs see data as being vital to help identify new customers, while a similar proportion (78%) say it helps them assess risk and is essential for financial planning (79%). A further 72% feel data is critical when trying to understand supply chain changes and more than a third (37%) already use data to increase revenue.

However, despite the UK narrowly dodging a recession, three-quarters (75%) of businesses are in the dark when it comes to using data to understand the disruptive forces in their ecosystem.

The report maintains that if businesses are going to stay protected against disruption, their approach and understanding towards data must change, with 30% currently struggling to source the right quality of data, 27% finding it difficult to democratise data for better decision-making and 30% feeling like they are constantly playing ‘catch-up’ with their processes and systems.

D&B vice-president of data science Rikard Candell said: “With so many market issues weighing on their minds, business leaders find it exceedingly difficult to predict what comes next, and decision-making has become correspondingly more challenging.

“Having ready access to data insights is crucial to help businesses navigate the uncertain landscape. It is concerning to note, however, that a significant percentage of businesses are not currently harnessing data in this way. While business leaders recognise the pivotal role of data and the insights it provides for their organisations’ future success, many struggle to unlock its full potential.

“As businesses aim to increase their resilience, data and analytics will be the cornerstone of critical decision-making. It can help you understand how your business is being impacted and identify risks and opportunities alike.

“Leveraging data and analytics can also enable companies to be proactive, agile and plan ahead using scenarios, such as the impact of further increased interest rates or energy prices on their fiscal planning, or potential disruptions to their supply chain.

“Data insights can help companies better prepare to overcome the next potential disruption, as well as any future disruptions that may occur, and better position themselves to grow and thrive.”