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The Data Paradox: why it is both advantage and barrier

A study commissioned by Dell Technologies uncovers what’s preventing businesses from turning data into action

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Image of Doug Woolley, managing director of Dell Technologies SA

More than half of South African businesses believe they are data-driven, but only one in ten are prioritising data’s use across the organisation – and 69% say they have more data than they can handle.

These are key findings of a globally commissioned study released today, conducted for Dell Technologies by Forrester Consulting. The study, Unveiling Data Challenges Afflicting Businesses Around the World, shows that for most businesses, data has become their most valuable business asset, but they are overwhelmed by the sheer volume, velocity and variety of data.

Based on a global survey of 4,036 data decision-makers from 45 locations, including South Africa, the findings build upon the biennial Dell Technologies Digital Transformation Index study, which assesses the digital maturity of businesses around the globe. The 2020 DT Index revealed that “data overload or being unable to extract insights from data” was the prime barrier to transformation, up from 12th place in 2016.

Dell Technologies commissioned the study to understand why and how we can stop data from becoming one of the key barriers to transformation.

These findings were revealed at the Dell Technologies Forum South Africa 2021, the company’s flagship event that brings together senior decision-makers and industry think tanks to discuss emerging trends, challenges and new growth opportunities in South Africa’s dynamic technology sector.

The study identifies several data paradoxes hindering businesses today, including:

  1. The Perception Paradox

58% of South African respondents say their business is data-driven and state ‘data is the lifeblood of their organisation’. However, only 11% treat data as capital and prioritise its use across the business.

To provide some clarity, Forrester Consulting created an objective measure of businesses’ data readiness.

The results show that 89% of South African businesses are yet to progress their data technology and processes and/or their data culture and skills. Only 11% are defined as Data Champions: companies that are actively engaged in both areas (technology/process and culture/skills).

  1. The ‘Want More Than They Can Handle’ Paradox

According to the research, 68% of South African businesses say they are gathering data faster than they can analyse and use it, yet 77% say they constantly need more data than their current capabilities provide. This could be because:

  • 66 percent are guarding a significant amount of their data in data centres they own or manage, despite the known benefits of processing data at the edge – where the data is generated
  • An IT strategy that doesn’t scale: 41 percent are bolting on more data silos, rather than consolidating what they have

Consequently, the explosion in data is making it challenging to meet business requirements, with 64% of respondents stating that their teams are already overwhelmed by the data they currently have.

“In a digital economy, data is one of the most valuable business assets, yet today it stands to be a significant barrier to growth. Navigating this modern-day paradox and turning vast amounts of data into actionable outcomes can seem daunting, especially when on a path to digital transformation. At Dell Technologies, we empower regional organisations to tackle these concerns by offering tailored end-to-end infrastructure solutions that not only support a data-driven work culture that is capable of predicting the future but is also equipped to harness data to achieve better business results, faster,” said Doug Woolley, Managing Director, Dell Technologies South Africa.

  1. The ‘Seeing Without Doing’ Paradox

While economies have suffered during the pandemic, the on-demand sector has expanded, igniting a new wave of data-first, data-anywhere businesses. However, the number of South African businesses that have moved the majority of their applications and infrastructure to an as-a-service model is still small (11%).

The report also states that an on-demand model would help the 83% of South African businesses that are currently struggling with some or all of the following barriers to better capture, analyse and act on data:

  • High storage costs
  • A data warehouse that is not optimised
  • Outdated IT infrastructure
  • Processes that are too manual to meet their needs

Hope on the Horizon

Although businesses are struggling to adopt robust data management strategies, many have plans to create a better tomorrow: 70% of South African businesses intend to deploy machine learning to automate how they detect anomaly data, 52% are looking to move to a data-as-a-service model and 58% are planning to look deeper into the performance stack to rearchitect how they process and use data.

Three ways businesses can turn their data burden into a data advantage:

  • Modernise their IT infrastructure, so it meets data where it lives, at the edge. This incorporates bringing businesses’ infrastructure and applications closer to where data needs to be captured, analysed and acted on – while avoiding data sprawl by maintaining a consistent multi-cloud operating model
  • Optimise data pipelines so data can flow freely and securely while being augmented by AI/ML
  • Develop software to deliver the personalised, integrated experiences customers crave

Data management is central to an organisation and its growth. Therefore, a solution should provide the global scale that businesses need as their application workloads and data volumes increase exponentially in the coming years.


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