In January 2022, McKinsey and Company released a forward-looking report that boldly predicted the landscape of data-driven enterprises in 2025. The report, aptly titled “The Data-Driven Enterprise of 2025,” laid out a vision that could revolutionize the way businesses operate.

By 2025, technology advances, the recognized value of data, and increasing data literacy will transform what it means to be “data driven.”

McKinsey

It’s now October 2023, and the question on our minds is: How close are we to realizing this ambitious vision?

Key Takeaways from McKinsey’s Report

To understand the progress we’ve made, let’s first recap the key takeaways from McKinsey’s report:

1. Data Embedded Everywhere: By 2025, every decision and process within an enterprise will be infused with data. It won’t be an option but a natural part of how employees work. This integration of data promises faster, data-driven decision-making and automation of day-to-day tasks.
2. Real-Time Data Processing: A vast network of connected devices will continuously gather and transmit data in real time. This capability will be powered by new technologies that provide quicker and more insightful results.
3. Flexible Data Stores: Data practitioners will utilize various database types to enhance data organization, fostering the rapid development of AI-driven features and new data relationships.
4. Data as a Product: Data assets will be treated like products, managed by dedicated teams. These data products will evolve quickly and in an agile manner, reducing the time and cost of implementing new AI-driven capabilities.
5. Expanded Chief Data Officer Role: Chief Data Officers (CDOs) will morph into full-fledged business units with profit-and-loss responsibilities. They will lead the charge in conceptualizing innovative data uses, developing enterprise data strategies, and monetizing data services.
6. Data Ecosystem Memberships: Large organizations will increasingly turn to data-sharing platforms for collaboration. Data marketplaces will facilitate the exchange and pooling of data, creating added value.
7. Prioritized and Automated Data Management: Data privacy, ethics, and security will take centre stage. Self-service provisioning portals and automated backups will streamline data management, fostering trust and accelerating the adoption of new data-driven services.

Now that we’ve revisited the roadmap, let’s delve into how close we are to achieving these goals in 2023.

Progress Update: Are We on Track?

1. Data Embedded Everywhere: Embedding data in every decision and process is a goal that leading organizations have actively pursued. Investments in data literacy are picking up, and businesses have invested in tools and technologies that promote data integration. While some organizations have made great strides, it’s essential to recognize that achieving full integration across all industries and sectors is a monumental task that will require continued effort.
2. Real-Time Data Processing: The proliferation of the Internet of Things (IoT) and advancements in edge computing have brought us closer to real-time data processing. Industries such as manufacturing, healthcare, and finance have witnessed substantial progress. However, the complete transformation will depend on the readiness of various sectors to adapt to these technologies.
3. Flexible Data Stores: Using diverse database types for the flexible organization of data has gained momentum. NoSQL databases, data lakes, and hybrid data architectures are becoming more prevalent, with the adoption of the Cloud accelerating the use of these technologies. This flexibility is helping organizations respond to changing business needs and leverage data more effectively. However, with this flexibility comes complexity and governance is essential to understand the diverse data landscape.
4. Data as a Product: Treating data as a product is a paradigm shift in how organizations manage their data assets. While many have recognized its value, this transition is still a work in progress for most enterprises, with the adoption of the agile DataOps methodology still in its infancy. Those who have embraced this approach are experiencing faster innovation and better utilization of their data.
5. Expanded Chief Data Officer Role: The role of the Chief Data Officer has indeed evolved. More CDOs are now involved in strategic decision-making, and some have been tasked with revenue generation responsibilities. However, this transformation varies from company to company, and it remains a journey rather than a destination.
6. Data Ecosystem Memberships: Data-sharing platforms and marketplaces have started to emerge, especially in industries where collaboration is critical, such as healthcare and finance. However, widespread adoption is still in the early stages, and regulatory challenges must be addressed.
7. Prioritized and Automated Data Management: Data privacy, ethics, and security have rightfully gained prominence. Organizations are actively investing in data management tools and platforms to ensure compliance and safeguard data. Leading organisations must focus on minimising internal threats to data while making data accessible for analytics. Automation is making data management more efficient and reliable.

The Road Ahead

As we assess our progress in building the data-driven enterprise of 2025, it’s clear that significant strides have been made in various areas. However, there is no one-size-fits-all approach, and each organization’s journey will differ based on its industry, size, and specific challenges.

To continue on this path, organizations are encouraged to:

• Upskill Employees: Investing in data literacy and training programs for employees is crucial to ensure that everyone can effectively leverage data.
• Modernize Data Architecture: Embracing modern data architecture and technologies is essential for flexibility and scalability.
• Align Data Practices with Business Goals: The alignment of data practices with business objectives ensures that data-driven decisions contribute to the bottom line.

In conclusion, the vision of the data-driven enterprise of 2025, as laid out by McKinsey, is an aspirational goal that has set organizations on a transformative journey. While progress has been notable, the journey is ongoing, and the road ahead holds both challenges and opportunities. By staying committed to data-driven principles and adapting to evolving technologies, businesses can come closer to realizing this vision and thrive in the data-driven landscape of the future.