How data deluge disrupts decision-making – and what leaders can do

Today’s businesses face high uncertainty and economic headwinds as 2024 gets under way. New Zealand may be at risk of another ‘technical’ recession in 2024, with growth still below its long-term average until the end of the year. Australia narrowly avoided a recession in 2023, but unemployment may rise and, while interest rates may be stabilising, the Reserve Bank is not ruling out another rate rise if conditions call for it.

To remain resilient no matter the crisis, organisational leaders are challenged to work smarter, improving productivity and efficiency, and enabling innovation. They must optimise scarce resources and make swift, smart, strategic decisions that will steer the company in the right direction.

But data deluge – the generation of more data than we can efficiently manage and leverage for insight or, put simply, ‘drowning in data’ – often stands in the way.

When it inhibits the productivity of governance, risk and compliance (GRC) teams, data deluge may be particularly harmful to organisations because it reduces the likelihood of identifying and managing risks, ensuring regulatory compliance, and making leadership decisions based on clarity of information.

By 2025, the world will generate 175 zettabytes, or 175 trillion gigabytes, of data every year, according to the International Data Corporation. But even today, businesses already struggle to manage their data.

A study by Oracle and data scientist Seth Stephens-Davidowitz reveals the challenges business leaders grapple with because of data deluge:

• 73 per cent report that high volume and lack of trust in data has prevented them from making a decision
• 87 per cent have experienced decision distress, or “regretting, feeling guilty about, or questioning a decision they made in the past year”
• 92 per cent say having an increasing number of data sources has held their organisation back
• 38 per cent believe managing many different data sources has hampered strategic decision-making
• 31 per cent think having many data sources has “introduced more opportunities for error”

The report’s findings have important implications for GRC teams trying to stay ahead of challenges in a fast-changing environment.

GRC is an interconnected ecosystem, but different departments usually work across disconnected systems, spreadsheets, platforms and SharePoint files. The sheer volume of data produced from these disconnected tools, which lack proper data management, prevents business leaders from having good risk oversight and from making quick, effective decisions.

This scenario also makes it difficult for GRC teams to communicate, collaborate and work more productively. They likely are not sharing enough information and are instead managing their own processes separately without a single source of truth, increasing the likelihood of errors and often duplicating workloads.

This data deluge creates significant productivity deficits for GRC teams, organisational leaders and the board.

The same study also found there is substantial faith in the power of data when leveraged correctly. Respondents believe data can help them make better decisions (43 per cent), mitigate risks (37), speed up decision-making (40), improve profitability (37) and prepare for the unexpected (30).

In other words, the gap lies between the mountain of data and the ability to manage, analyse and glean actionable insights from it.

The good news is there are several ways organisations can harness and manage data to prevent data deluge from derailing productivity:

Culture: Foster a culture that values data-sharing and collaboration, and put centralised and connected systems and processes in place to enable different departments to work more seamlessly together. Aside from making processes more efficient, this can also help teams draw from each other’s data to get a big- picture view of GRC concerns. Striving towards Business Integrated GRC – one of the key trends for 2024 identified by GRC 20/20 Research – can also help companies improve productivity by integrating GRC into core business processes and aligning these with strategy, objectives and performance, instead of having “additional layers of compliance band aids disconnected from the business”.

Technology: When bringing in new GRC tools, opt for ones that integrate with existing enterprise resource planning (ERP), customer relationship management (CRM), human resources (HR) or other relevant platforms the company is using. Take advantage of automation, analytics and artificial intelligence (AI) to truly maximise the usefulness of your data and remove human-resource bottlenecks.

Solutions that enable you to have a single source of truth for all GRC matters are also key. Harnessing a centralised solution to manage GRC removes workload duplication, streamlines activity, improves data quality, enhances business clarity and fortifies the strengths across all three lines of defence.

The Diligent One Platform gives organisations a broad range of GRC applications on a single, easy-to-use platform. This can help practitioners understand and manage risks better and share insights with their organisation’s leaders.

Diligent One also securely and seamlessly connects with ERP, CRM, HR and other data sources, ensuring a clear view of the bigger picture, and makes sharing insights – with committees, the board and other groups – safer and easier with customisable templates and dashboards.

The platform has inbuilt AI, automation and analytics capabilities, as well as third-party data feeds, that offer access to independent and comparative benchmark data on areas like environment, social and governance, cyber and investor insights.