As we enter the third decade of the 21st-century, more and more companies in India are transforming themselves, creating a business built on data. The smart companies of the future – the ‘Cognitive Enterprises’ – recognise that the data generated from customers, employees and day-to-day operations will fundamentally transform the way business is conducted. Successful companies will become experts at identifying important and potentially transformational data, applying the correct analytics and using the resulting insights to pursue significant growth opportunities in the coming years.
The trust customers once gave, almost blindly, to brands and institutions has been slipping away for some time. They now demand something else: transparency of data associated with products and services and, in the case of personal data, assurances that it’s used in a fair manner and kept safe.
Hence as the most valuable asset for a business, data has become inextricably entwined with trust, changing the value equation. Data breaches, corporate misuse of personal data and more making headlines frequently, data privacy is an important competitive advantage.
Companies that strike the right balance between the use and sharing of data on one hand and proper stewardship and value reciprocity on the other will achieve ‘Torchbearer’ status. Then there are the ‘Aspirationals’ – enterprises who are beginning to integrate organisation-wide business and data strategies but due to the lack of a data-driven culture find limited success in extracting value from the data.
A new study, titled ‘Build Your Trust Advantage’ by the IBM Institute for Business Value, pegs 10 per cent of respondent companies in India as torchbearers. The study is based on interviews with 13,000 C-suite executives worldwide out of which 490 executives are from market-leading companies in India. The study indicates that torchbearers outperform their industry peers in revenue growth and profitability by 122 per cent in the India market.
In India 90 per cent of torchbearers and 43 percent of aspirationals use data to strengthen customer trust. Further, 73 per cent of torchbearers and 26 per cent of aspirationals say their C-suite has access to accurate, reliable and actionable data that enables a 360-degree view of their customers. Significantly, torchbearers in India are 144 per cent more likely than aspirationals to plan a significant investment in artificial intelligence (AI) or machine learning in the next two to three years to harness the power of data.
As the Indian Government gears up to unveil a data protection framework to regulate the gathering of data and to curb its misuse, companies in India need to build a social contract of trust around data gathering and sharing. Experience shows that the best way to build and demonstrate that trust is to make it in all parties’ mutual interest to share data. Companies can profit from the knowledge and insights the data yields, while business partners, clients and customers who share their data, can enjoy the benefits of better products and services tailored to their individual needs. Businesses that adopt data safeguards will have a major competitive advantage in 2020 in the realm of data-driven commerce.
So, how can brands establish and maintain trust? Here is a guide:
• Accountability, accountability, accountability: Brands should identify how their customers want them to use their data so they can ensure that they meet or exceed those expectations.
• What’s in it for the customer? Customers must be able to see significant value in sharing their data. Brands must make that value proposition clear. They need to give customers something they value in return for their data.
• Transparency should be thy name: Companies should put in place a policy of communicating problems promptly and fully.
The advantages of a reciprocal approach to data sharing become even more apparent as newer technologies like AI enable businesses to take a more personal approach to the business-customer relationship. Blockchain, meanwhile, is helping make trust verifiable.
In addition, a company must strive to ensure that its data is accurate, up-to-date and appropriately contextualized. So while businesses liberate their data, allowing it to circulate within the ecosystem they should scrupulously safeguard it by enforcing strict rules on who gets access to which sets of data.
Trusted data is the new gold in the emerging global economy. To be successful in 2020 and beyond, leading brands in India realise the need to turn the corner from amassing data to determining how best to monetize it, including how to build ecosystems to create new exponential value and instilling the proper safeguards to build customer trust.