PRESS RELEASE – WÜRZBURG, June 22nd, 2021
BARC (Business Application Research Center) today published the results of its topical survey “Data Black Holes – Are Data Silos Undermining Digital Transformation?”. In the study, BARC analysts Jacqueline Bloemen and Timm Grosser take a close look at the implications of data silos for the data-driven enterprise and offer insights into the main challenges companies are currently facing due to data silos. The study is available for download free of charge thanks to sponsorship by Ab Initio, Collibra, Dataiku and Denodo.
- #1: Central data provisioning is not the one and only key to success when it comes to dissolving data silos
- #2: Having uniform business terminology helps companies to step up their game when it comes to coping with data silos
- #3: Organizational silos have to be taken as seriously as data silos and need to be addressed by management
Raising awareness of existing data silos and their consequences
According to a new BARC survey, many companies are struggling with the consequences of their current data landscape. When asked about the biggest challenge in the use of data, there is a clear message from participants. 41 percent agree that having key personas tied up with elementary data problems instead of working on the digital future of the company is the most pressing issue. This leads companies to the conclusion that action is required: 27 percent are already working on raising awareness of existing data silos and their consequences. A further 33 percent are planning to take this measure.
Centralized provisioning of data does not necessarily ensure simple and efficient data use
The study results show that investments in defining uniform business terminology pay off. Companies that have not implemented such terminology have significantly more problems in using their data to address new questions. This includes companies with a central data warehouse that is undermined by individually created data sets. But even a common data language is not the sole remedy. Companies that have implemented uniform terminology in a decentralized data landscape clearly have fewer problems using their data than those without common terminology, but not as few as companies with a centralized data landscape.
“In the future, it will become even more difficult to manage data in a centralized manner. The data landscape of the digital enterprise is highly distributed. In other words, we must live with data silos. Solution concepts must integrate data silos instead of fighting them,” said Jacqueline Bloemen, Senior Analyst Data & Analytics at BARC and co-author of this study.
This is reflected in the approaches that companies are taking to deal with their challenges (see Figure 1).
Figure 1: Top 5 selection from “Which of these approaches is your company taking to deal with the challenges caused by data silos?”
(n=318) © BARC
Knowledge about data, but not the data itself, should be provided centrally. The most frequently chosen approach to this is to create transparency about existing knowledge of data and foster collaboration (49 percent). This goes hand in hand with establishing a platform for collaboration and knowledge exchange, which 34 percent have chosen to do. Another 30 percent state that they are creating a central directory for finding and understanding data sources. These approaches are mostly implemented with the help of data catalog technologies. 31 percent of companies are working to liberalize access to data and improve self-service support. This is in line with other measures to facilitate ad hoc access to data. For example, 36 percent plan to create a central platform for data shopping. Among best-in-class companies, this approach is even more common (45 percent). One building block for this is to make physically distributed data accessible without having to copy it. This plays a greater role especially for companies with distributed data provisioning (27 percent compared to 23 percent on average). However, with the named approaches taken to deal with the challenges caused by data silos, a new set of challenges arises.
Business and cultural challenges are obstructing efforts to address data silos
In principle, all companies strive for digital transformation. However, they face several business and cultural challenges in this process (see Figure 2).
Figure 2: Top 8 selection from “What business and culture-related challenges have you experienced in implementing approaches to deal with the issues caused by data silos?”
(n=312) © BARC
The highest rated concern, lack of communication (56 percent), is in stark contrast to another study finding with companies reporting that data and information is shared extensively between departments. The fact that this apparently does not really work in practice is also underpinned by the second-highest rated problem: a lack of motivation to share knowledge with others (42 percent). Further challenges include a lack of clear strategic goals and a lack of understanding of what these mean in practice.
“Some learning processes can be supported bottom-up. However, when it comes to strategy and goals as well as the behavior of people in the company, it is clearly the managers who are called upon,” said Timm Grosser, Senior Analyst Data & Analytics at BARC and co-author of this study.
A lack of management support was ranked as the third most important challenge in the implementation of strategic measures at 38 percent. For companies with decentralized (42 percent) and hybrid (43 percent) data landscapes, as well as for laggards (58 percent), this applies even more frequently.
About the survey
Data Black Holes – Are Data Silos Undermining Digital Transformation? is a topical BARC survey assessing the challenges companies currently face due to data silos and how to overcome them. The study is based on a worldwide survey of 318 companies of various sizes and industry sectors. The focus of the study is to assess the implications of data silos for the data-driven enterprise. It also examines approaches taken by companies to break down the barriers of these data and knowledge silos. The authors of the study are Jacqueline Bloemen and Timm Grosser, Senior Analysts for Data & Analytics at BARC.
BARC (Business Application Research Center) is one of Europe’s leading analyst firms for business software, focusing on the areas of data, business intelligence (BI) and analytics, enterprise content management (ECM) and customer relationship management (CRM). The company was founded in 1999 as a spin-off of the Chair of Business Administration and Information Systems at the Julius-Maximilians-University in Würzburg. Today, BARC combines empirical and theoretical research, technical expertise and practical experience, including a constant exchange with all market participants.
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