How to Get the Data Engine Humming
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Data may be the oil of the new industrial revolution, but there’s clearly a lot of waste and leakage going on. Numerous studies show only a small amount of business data is creating real value, while far more is being drilled, burned and spilled, with little purpose.
So what distinguishes the efficient data users from the deficient? That’s the subject of an IBM study out this week that surveyed more than 13,000 C-suite executives in 20 industries and 98 countries. The conclusion: only about 9% of those surveyed have figured out how to effectively fuse data strategy and business strategy in a way that creates real value. The rest are still in the trial and error stage, spewing petrol in the process.
A few takeaways from the study on how to get the data engine humming:
- Trust is critical. When dealing with customers, the best companies are going to great lengths to protect customer data, and are providing real value in return for data sharing. The study cites South Africa’s Discovery Holdings as an example. The company uses personal data on healthy behaviors to provide insurance discounts in a way that benefits both customers and the company.
- A focus on revenue works best. Most early A.I. users are looking for ways to cut costs. But those that focus on revenue are more likely to achieve breakaway success.
- It pays to share. Success comes from creating new data ecosystems. The study quote a Chinese financial CEO saying: “The winners in the data game will be the ones that open themselves up to partners and collaboration.”
- Change must come from the top. The most successful companies are those that fuse data strategy with their overall enterprise strategy.
You can read the study here. More news below.
Asian markets fell today following President Trump's threat of more tariffs on Chinese imports. Trump said the hikes would come if there were no interim trade agreement between the countries. On the other hand, Trump also claimed that a "Phase 1" deal was imminent. MarketWatch
There's now a federal inquiry into Google's secretive absorption of health care data from 50 million patients of the Ascension hospital chain. Following the deal's exposure this week, the Office for Civil Rights in the Department of Health and Human Services is probing the matter to see if the companies are complying with health data privacy law. Wall Street Journal
The International Energy Agency says greenhouse gas emissions are likely to rise through 2040, in the absence of radical governmental action. That would mean vastly overshooting the limits set under the Paris Agreement, which scientists say would likely mean runaway climate change that can no longer be brought under control. Yahoo Finance
Elon Musk's Tesla is to build its first European "gigafactory" on the outskirts of Berlin, the CEO has announced. The plant, near the (chronically delayed) new Berlin-Brandenburg airport, will create around 10,000 jobs and start pumping out batteries, powertrains and cars in 2021. Why's it not in the U.K.? Brexit. Auto Express
AROUND THE WATER COOLER
Apple is reportedly in the final stages of wooing former HBO CEO Richard Plepler—the guy who greenlit Game of Thrones—to produce content for its new TV+ platform. Plepler has recently been preparing to launch a new production company; exclusivity for Apple TV+ would be quite the coup. New York Times
The A.I. think tank Future Advocacy and artist "Bill Posters" have put out faked videos of U.K. Prime Minister Boris Johnson and opposition leader Jeremy Corbyn endorsing one another for the country's upcoming general election. As the videos make clear, the point is to raise awareness of how "deepfake" technology risks becoming the future of disinformation, unless it is legally reined in. Vice
Hong Kong Violence
Dozens of mainland Chinese students have been fleeing Hong Kong, as violent pro-democracy protests continue. This week's enhanced violence has led the Hang Seng index to slip by almost 4% so far—clashes between protestors and police are taking place in the city's financial district. Financial Times
Silicon Valley Bank, the bankroller of names such as Airbnb and Pinterest, is moving into the Nordic region. As Jennifer Baljko puts it in this piece for Fortune, "the U.S. bank’s entry, which was encouraged by Danish companies and investors, is seen as filling a kind of multifaceted funding-lending-consulting-networking-cheerleading gap that traditional local banks have a hard time closing." Fortune
This edition of CEO Daily was edited by David Meyer.
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