In today’s fast-paced digital world, data is the lifeblood of organizations. From healthcare to finance, education to entertainment, data drives decision-making, fuels innovation and empowers businesses to thrive in a competitive landscape. However, for years, IT and business leaders have been grappling with a significant challenge – data silos.
What Are Data Silos?
Data silos are barriers that segregate data within an organization, making it inaccessible or difficult to share across departments or teams. These silos often result from various factors like disparate systems, departmental divisions or historical practices. The consequences of data silos are significant. They hinder data-driven decision-making, slow down business processes and limit an organization’s ability to harness the full potential of its data.
Digital Transformation Imperative
In the era of digital transformation, the need for seamless data flow and accessibility has become more critical than ever. As companies undergo digital transformations, the data transformation is often the first step. It begins with breaking down data silos and removing the barriers to data access. The goal is to normalize, aggregate and democratize data across the organization.
Benefits of Democratizing Data
Democratizing data across an organization holds the promise of numerous benefits. It unlocks the potential of data to inform decision-making, drives efficiency in analytics, accelerates responsiveness to client needs and unveils new possibilities for products and services. Breaking down data silos can lead to improved data quality, the establishment of centralized data retention policies and enhanced security.
Real-World Success Stories
Many organizations have embarked on the journey of breaking down data silos and their experiences offer valuable insights into the challenges and rewards of democratizing data.
Centralized Reporting Enhances Data Value
Phoenix Children’s, a pediatric health system, faced the challenge of limited data access due to proprietary reporting tools. Over a decade, they had developed a data warehouse with over 120 separate data systems. The solution was to move away from reporting tools embedded in individualized, siloed systems. Phoenix Children’s shifted to centralized reporting from a central data warehouse.
This transformation encountered initial political challenges as the organization untangled traditional siloed data approaches. However, the turning point came when colleagues realized the power of combining data from different systems. The organization found that the synergy of diversified data significantly increased the usefulness and accuracy of the information. This realization expedited the transition away from siloed approaches.
By democratizing data access, Phoenix Children’s witnessed several benefits, including improved data quality, centralized data retention policy development and enhanced security. The organization transitioned from embedding analysts in siloed departments to a more centralized approach. This approach allowed the organization to remain agile, respond to urgent needs and avoid wasting resources on low-value data projects.
Lakehouse Architecture Supports Data-Driven Decisions
Lexmark, a printing and digital imaging company, walked on a journey to become a data-driven organization. They recognized that data is the new gold and their transformation was aimed at systematically collecting as well as utilizing structured, unstructured and streaming data. To eliminate data silos, Lexmark established a data steering team to align data across business areas and develop data governance functions to ensure trust, privacy and data security.
Lexmark adopted a data lakehouse architecture built on a Microsoft Azure environment, enabling the organization to make data-driven decisions across the business. The architecture enabled every function to embrace data to inform decisions about product manufacturing, pricing, inventory management and predictive maintenance.
Democratizing data at Lexmark resulted in more than 20 machine learning models in production, with thousands of employees using hundreds of dashboards for data-driven decision-making. Lexmark realized that data-led decisions are vital and having access to all available data is essential for making informed decisions.
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By breaking down data silos and democratizing information, Lexmark created a culture of innovation within the organization. Improved coordination and collaboration between different groups resulted in ingenious solutions to complex challenges. Employees felt empowered, as they had equal access to the information required to excel in their roles.
Common Data Platform Drives Data Standardization
ISG, a technology research and advisory firm, embarked on a journey to break down data and political silos by creating a common data platform. This initiative began with building a common data platform and delivering it across the organization.
ISG adopted a systematic approach by inventorying data across the organization and categorizing it by type, owner, platform, data usage, data formats, terminology and more. This knowledge was instrumental in building a data dictionary and common taxonomy that would underpin data access, usage and monetization.
A critical aspect of this journey was gaining the cooperation of data owners, which was facilitated by a detailed understanding of their data and its structure. ISG established cross-functional teams that involved individuals from various business units, fostering trust, transparency and accountability across data owners.
Breaking down data silos allowed ISG to make data more widely available to its teams, resulting in better decision-making, enhanced analytics and a quicker response to client needs. The organization experienced side benefits, including improved data quality, centralized data retention policy development and enhanced security.
Success Strategies for Breaking Down Data Silos
Several best practices have emerged from organizations that successfully broke down data silos:
Secure Executive Support and Vision
Overcoming resistance from departments with embedded resources is a common challenge when breaking down silos. Strong executive support and vision are critical to address this challenge. When executive leaders understand the value and return on investment in breaking down data silos, they can provide clear direction and commitment to data integration efforts.
Build Cross-Functional Teams
Assembling teams that comprise individuals from different business units is essential to build trust, transparency and accountability. Cross-functional teams can share tactics for managing data, overcome challenges and foster a collaborative atmosphere.
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Identify Differentiators and Incorporate Data Discovery
Focus on the possibilities that arise when data silos are dismantled. Seek differentiators that a centralized data approach can offer and combine data from multiple systems to better illustrate problems or opportunities. Incorporate data discovery to align data efforts with real use cases rather than focusing on understanding or reorganizing data before generating value.
Create Digital Threads
Establish digital threads that provide end-to-end visibility of data flow through an organization’s product lifecycle. Digital threads prioritize data sets, automate data processes for cleanliness, accuracy and security.
