You know your data is worth something, but how does it affect your company’s intrinsic value?
The remarkable explosion of technology hasn’t just changed the way we do business; it has changed the very nature of business. A century-old insurance company’s consumer data may now be as valuable as its actuarial expertise. In fact, you can find similar changes across every industry.
Adapting to these existential changes can impact a company’s value more significantly than board readjustments or a new product launch. Whether you’re looking to increase valuation in anticipation of a merger and acquisition process, an IPO, another round of funding, or are just focused on increasing your business’s intrinsic value, there is a new fundamental market truth:
How you do things is every bit as important as what things you do.
That depends greatly not just on how many ones and zeroes you’ve piled up, but what you can learn from them. A March 2017 study by McKinsey found that spending on analytics increased operating profits by an average of 6%. But good analytics requires good data—and good data requires good system management.
What Better System Management Really Means
So how do you improve system management? What areas do you need to examine? We can break that into a few main categories.
- Systems Architecture and Integration – Technology requires the ability to communicate and share services and data. Single monolithic systems that cannot be broken down into sharable and reusable services work against your company’s value.
- Information Management – If you were on the phone with customer service at a bank, and they offered you a product you already had—and they weren’t aware of it—how much would you trust them? Effective information management, with integrated systems that share data, gives your company a single version of truth, and lets you know your customer.
- Enterprise Analytics – All the raw data in the world is meaningless if you don’t have the tools in place to turn that data into a coherent picture. Then, you must transform that picture into a plan. Collecting data is easy—learning how to interpret and take advantage of this information can quickly move you ahead of your competition.
- Customer Experience Management – If you’ve been in banking for any amount of time, you know that your customers need different financial products and services at different stages of their lives. If you’re handling customer experience management properly, they’ll come away from each interaction with your organization feeling secure in doing business with you.
So how do you assess and improve the relationship between your data, system management and your company’s intrinsic value?
Viewing the situation through someone else’s eyes is extremely important. Just as it’s hard for a writer to edit his or her own work, it is often very challenging for a business to properly evaluate its own in-house processes. You’re accustomed to those processes, and they’ve become second nature. But a valuation always occurs through an objective third party’s eyes. This is why many businesses need a consultant to examine their processes, identify the areas for improvement and devise organic, mindful ways to evolve.
You’ll want to work with partners who bring experience and insight, so they can identify issues that you might have missed. It’s a partnership that helps make the transformation of your business cohesive, non-disruptive, and productive for everyone involved. Better system management increases valuations, making a business more attractive to buyers, partners or investors, all while setting you down the path toward further growth. If you’d like to learn more about how Primitive Logic can help improve your system management, let us know.
Follow Jill Reber on Twitter at @PrimitiveCEO.