Establishing a data culture in companies

How can companies establish a data culture?

Companies that want to use the complexity of data to their competitive advantage and exploit their full potential in the digital world need a data culture. However, a data-driven company only works if every company member knows their role in relation to data use and actively contributes to data-driven action. In other words, all employees are necessary for a data culture to emerge. In the following article, you can find out how to promote a data-driven mindset in the company and what measures you need to establish a data culture in the company.

First: Understanding and using data

The most important discipline in establishing a data culture is probably the understanding of data and the ability to use digital data.

We know what this often looks like in companies these days. Colleagues usually work in parallel on an Excel file in which they enter their planning data manually. There is usually one person who suffers, often the head of controlling, who then compiles and visualizes all the data in an overview. If you are lucky, you get additional relevant figures from other departments, such as the finance department, which you can incorporate into your overview and whose influence you can take into account for your decisions.

The problem is that significantly more digital data is collected today than 15 years ago. The abundance of data collection tools is increasing rapidly. If all employees now collect their data in their own spreadsheets and send it to each other, it takes far too long to carry out short-term target/actual comparisons and base business decisions on up-to-date data. The digital transformation only works if cross-company and automated planning takes place in the company - in other words, if all the data collected in the company can be evaluated in real time, correlated with each other and processed for forecasts and strategic decisions at any time.

In the long term, we will not be able to establish such a data culture with isolated planning files and irregular exchanges between departments. Instead, we need a clear system that defines how data is collected, merged, exchanged and used. And this requires some fundamental disciplines, which we would like to highlight below.

Data literacy: more than just data entry

The key contact persons for establishing a data culture are data officers or controlling managers who have experience in processing and analyzing data holistically within the company. Due to the ever shorter validity of data, it will be necessary to work with agile and flexible tools that can process large volumes of data at lightning speed.

Internal and external data sources must be connected in order to be able to use all available data. Companies currently have the following options for this:

1) Companies build their own local tool landscapes and ensure that data from different tools is evaluated and transferred with their own IT department and a lot of maintenance work.

2. Data managers bring a high level of expertise and a lot of time to adapt common holistic tools to the circumstances and needs of the company and to be able to use them flexibly.

3) Companies are looking for holistic data collection and planning tools that offer a self-service platform and make it as easy as possible for data managers, but also for management, to plan agilely and independently and to evaluate any amount of data automatically and at lightning speed.

No matter which option companies choose: It is always the task of those responsible for data to assess which tools can be used to master the wealth of digital data and its processing in order to create a solid database. Establishing a data culture that not only implements the company’s needs, but also adheres to data ethics standards and data protection compliance. But more on this later.

Determining data governance

As with all projects, data culture also requires supervision. This means that all sub-disciplines of data management should be coordinated by trained managers in order to establish a data culture within the company. This means that data availability, data consistency and the use of data are regularly checked. Data governance also determines who has access to which data and when. It is therefore responsible for the continuous security and protection of company data, both in terms of storage and hosting as well as internal and external data transfer.

To ensure that all these tasks are carried out, data governance provides a system in which the exact data processes and suitable tools for data collection and processing in the company are specified.

The future of data integration

Smooth and error-free data integration is essential if you want to work in a data-driven way. We understand this to mean the automated storage and consolidation of all data in a central location. As a result, as few tools as possible should be used. Instead, more comprehensive, agile and high-performance tools that are connected to BI tools and offer a high level of user-friendliness with self-service.

All departments use a central company tool for the holistic integration of all data. So there is no separate tool for the HR department, no separate tool for the sales department and no separate tool for the finance department. This does not mean that companies no longer work with specific accounting software or other valuable tools. They just no longer do so exclusively. Additional tools are connected to the central data collection tool in order to integrate the data collected there into a central planning overview.

Data ethics for greater protection and trust

Internal data protection

Everyone knows the term GDPR. Data protection applies not only to contact with customers and suppliers, but also internally. A data culture is based exclusively on data - making it even more important to protect it with strict measures. To this end, data governance creates a user management system that is used to assign roles and rights for data access within the company. This ensures that sensitive data only falls into authorized hands and can still be viewed by everyone who needs it for planning purposes.

Protected data exchange

In a data culture, sensitive data is no longer exchanged via email, but stored in central cloud-based tools where all participants are informed of changes. The data can also be shared with guests in a separate and protected guest account.

Each workspace should be protected by password policies and 2-factor authentication.

Data protection compliance

Whether in sales, human resources or marketing - there are clear legal requirements throughout the company that focus particularly on data protection. It is particularly important to give customers complete control over all their data and to strictly protect the data they share. Examples include the accurate control of AI and other tools used to correctly evaluate and interpret customer data. When communicating with customers, comprehensive information must be provided about the use and processing of data. Customers must always know what happens to their data and when and be able to influence this. In this way, your customers can build trust in you and know that their data is in safe hands.

It is a good idea to hold training sessions in which you sensitize all employees to the topic of data protection and provide them with clear guidelines for internal collaboration and contact with customers.

Data security

Building a data culture is based on a solid database that underpins all our decisions in the company. Of course, this is only possible if we protect our data as well as we can. And this is not just about data backup. Small and medium-sized companies in particular are increasingly concerned about the impact of cyber-attacks.

This makes it all the more important to equip your company with effective protection programs and to integrate control and alarm systems. In addition, all data transfer, login attempts and changes to all data should be logged centrally.

All-in-one cloud software solutions hosted in Germany, which are used as integrated data collection and processing tools, offer the highest level of security for companies based in Germany. The data is not stored on different servers, but exclusively in the cloud. With hosting in Germany, you therefore have complete and also receive immediate support in the event of danger. An important prerequisite for guaranteed data security with cloud software is that the software providers apply GDPR-compliant technical and organizational measures (TOM) to protect your data from unauthorized access and total failures. These must also have control been audited by an external and independent auditor (VdS 10000).

Automate data acquisition

When establishing a data culture, data entry tools almost completely replace manual data entry by employees. Data is still entered into separate planning templates. However, the individual templates are stored centrally in the cloud-based planning software and are updated as soon as they are entered and automatically integrated into the central planning system. This means that all partial plans, regardless of the department, can be taken into account in the overall plan. In the overall planning, you have the option of making target/actual comparisons, carrying out forecasts and simulating measures in order to adjust your planning and all associated sub-plans at any time. Planning in real time - a basic requirement for data-driven decisions!

In our blog, we show what automated data collection looks like using the example of personnel cost planning.

First and foremost: empowering employees to act in a data-driven manner

Are your employees ready to work based on data?

The readiness aspect is often forgotten when establishing a data culture, although it contributes significantly to the success of data-driven work. The primary task of companies will be to prepare their employees for the use of digital data and to actively support them in this. This task cannot be accomplished by data officers or controlling alone. It requires a corporate culture in which everyone is equally familiar with the data that is important to them. In which everyone knows how to collect, store, visualize and exchange this data without jeopardizing data or rights.

It also requires the insight and trust that the consistent use of data is an important part of the company’s success and its own effectiveness in the workplace.

We basically recommend two things that will make it easier for you to manifest a data-driven mindset in your company:

1) Use tools with an intuitive user interface

Rely on intuitive, user-friendly data tools that enable your employees to take responsibility for data independently and without prior knowledge or training. Only those who feel safe and comfortable at work are willing to accept changes and actively help to implement them in the company.

2) Communicate goals and benefits transparently

Conduct one-off training sessions on data use and data quality throughout the company. Bring all employees up to the same level of knowledge by illustrating the basics of data use and the goal of data culture in your company.

Contents of one-off training courses to establish a data culture

1. Objectives and functions of data

Explain the objectives and functions of data in the company. Explain how important it is to make data-supported decisions and why it is necessary to network as much data as possible in the company.

2. More transparency in cooperation

Illustrate how data improves collaboration within the company, but also with cooperating companies, investors and customers. You will not only gain more insights, but also more transparency and more trust.

3. Increase productivity

Show your team how data increases the productivity of all employees in the company. That it saves valuable resources, replaces manual tasks, speeds up processes and creates space for employees’ skills and potential.

4. Prerequisite for digital transformation

Explain the term “digital transformation”. Show to what extent your data helps the company to reorganize processes and develop new processes and products.

5. Importance of data quality

Identify the impact of high-quality data on your business goals and decisions and explain how you can work together to improve your data quality.

6. Strengthen security in companies

List the risks associated with the increasing amount of data and explain what measures are necessary to protect the security of the company and all employees.

These articles might help you:

Yes to the cloud: advantages of cloud planning at a glance

Improve your data quality sustainably with automated data collection

Personnel planning software creates unimagined potential

Checklist: What you should look out for when selecting controlling software

Software implementation: your checklist for successful implementation