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Better Data Quality Means Higher Sales and ROE

Quality over quantity. It’s true of time, food and friends (except on Facebook). It’s also true of data.

Do you need another reason to improve your data quality? I didn’t think so, but here’s one anyway.

Better Data QualityThe growing flood of Big Data — ever-expanding data sets whose volume overwhelms regular software tools — offers quantity to every firm, but not all firms sift out the good quality data for making decisions. And that can be a very big deal, according to more than 150 Fortune 1000 firms in a Sybase-sponsored study conducted by the University of Texas at Austin and the Indian School of Business.

Increasing data accessibility and intelligence can yield compelling dividends, the study shows. Firms with a 10 percent improvement in data attributes over their competition realized a 16 percent higher return on equity. Though results varied between verticals, better data quality helped the median company in the study increase its ROE from 21 percent to 24.4 percent. For a Fortune 1000 firm with 36,000 employees, that could translate into a sales increase of $55,900 per employee, or $2.01 billion.

An article in Forbes co-authored by study leader Dr. Anitesh Barua, an information technology professor at the University of Texas at Austin, explores a few more examples of how improvements in data quality can increase returns. Barua’s co-author, Sybase CTO Irfan Khan frequently discusses the growing importance and rising prominence of data within the enterprise.

The companies that succeed going forward will be those actively managing both data and its integrity. They will control the quantity and master the quality.

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