Data sprawl is real. I know from personal experience working with Redstor – a leading specialist in data management (and previous Beech Tree portfolio company). Data has become an unstoppable snowball for most organisations. And in today’s digitally powered economy, it’s impossible not to accumulate more and more of it from the increasing plethora of on-premise or cloud-based systems, applications, platforms and databases.

There’s Office 365. There’s Google Workspace. There are numerous CRM systems, finance platforms, HR platforms, and thousands of operational management platforms. There are intranets and extranets, WhatsApp and Slack, and CCTV and IoT devices… the list goes on and the eye-watering stats go up.

In fact, Statista estimates that by 2025, the volume of captured, copied and consumed data – fuelled by a pandemic-induced increase in remote learning, working, entertainment, and digital transformation – will be over 180 zettabytes (that’s 180 followed by 21 zeros). This figure is a three-fold increase compared to 2020. It’s little wonder McKinsey thinks the SaaS industry alone jumped five years forward in terms of digital transformation in the first eight weeks of the pandemic.

Unstructured = unwieldy

According to the CIO, 80-90% of this data is unstructured and comes in many different forms, sizes, and shapes. This not only makes it harder to manage and analyse, but also more costly, too. So it’s hardly surprising that 95% of businesses cite managing their unstructured data as a problem. And the truth is, it’s only going to get worse as society becomes more digitised.

Of course, created, captured, copied, and consumed data brings with it other challenges. In particular, in highly regulated industries like financial services and healthcare where there are strict rules about how data is stored and managed, and who can and cannot use it. The financial, operational and reputational damage for failing to meet regulatory or compliance obligations can be enormous. A case in point is the £180 million fine (later reduced to £20 million) slapped on British Airways for not adequately protecting its customers’ personal and financial data.  

And the more data you create, the more care required to look after it, including not losing it – by accident or design. Data breaches (again, fuelled by working from home during the pandemic) have become a major concern, with a staggering 39% of UK businesses suffering a cyber security breach in 2021. And we know through our investment in cyber security managed services business, Performanta, that cyber crime is only heading one way….

Data’s immeasurable value

Data is no longer the preserve of big companies with sophisticated systems for capturing, storing, and analysing information. These days, organisations of all shapes and sizes and across every sector and industry vertical, are tapping into data’s untapped potential to help them achieve real business advantage – especially in interrogating and generating value from unstructured data.

In many ways, this new-found appreciation of data’s immeasurable value explains the proliferation and potential growth of data-management companies. According to market research company Reportlinker, the global enterprise data management sector alone is expected to reach USD 189 billion by 2027 (a CAGR of over 14.5%). That’s a sizeable opportunity for the ambitious.

The rise of the machines

But identifying valuable data becomes infinitely harder with data sprawl. I like to think of it in terms of finding a needle in a haystack with a metal detector. If the haystack’s small, it’s easy. But the bigger the haystack becomes, the harder and slower it becomes – especially if there are humans involved in data processes.

This is why AI-driven data management will become increasingly important – not just to keep up with the volume of data being generated and any compliance obligations that come with it, but also to make sure any data considered valuable is accurately classified, tagged, and stored for use when it’s needed.

Start with the end in mind

At the end of the day though, generating a petabyte of data is worthless if you can’t mine it for the gold it contains. So companies need to start with a clear idea of the outcome they want to achieve, then see how data can empower and help them accomplish it. Here are a few first-hand examples of how impactful data management can be.

Recently, a well-known cycling brand came to Ancoris (another of our portfolio companies) with a clear outcome-based objective: create a more personalised experience for our customers and streamline our supply chain in the process. Among other things, Ancoris looked at their data and worked out a way to combine the retailer’s own customer data and behaviour, with other publicly available data sources (like competitor pricing), to build a recommendation engine and end-to-end process. The solution presents personalised upsell opportunities to customers at check-out based on what they’re likely to do next, along with . dynamic pricing based on a range of different factors to optimise warehousing and their buying process down the line. It’s been a huge success and in the retailer’s hyper-competitive market, where margins are relatively thin, the increase in basket size and improved operational efficiencies have been absolutely transformational.

A few more examples: Cloud2, which we invested in through BCN (an IT Managed Services portfolio company) uses data to help A&E departments achieve improved patient outcomes by better managing human, product, and bed resources. And Avid Insurance, which uses multiple data sets to analyse, manage, and price social housing insurance, travel insurance and various other specialist risks.

Plus, there are numerous example of data being used in areas as diverse as crop analysis, pest control, flood-risk assessments, criminal investigation, and identifying abuse on social media. Proof that with the right data, organisations can change fundamentally how they operate or serve their end-users, customers or society. Even to the point of protecting and changing lives for the better.

Last word

While data sprawl is undoubtedly a major obstacle for many companies, in our experience it’s also become an unbridled opportunity for data management companies. Indeed, we see Data-as-a-Service (DaaS) becoming the norm over the next five years. Every organisation generates data, but by layering it with other external data sources we can create meaningful outcomes for businesses. Put another way, the opportunity is immense if businesses harness the value they have in their data.

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