Explain the importance of using data in organisations and why it is necessary to ensure that data is accurate when determining problems and issues. (A.C 1.2)

Explain the importance of using data in organisations and why it is necessary to ensure that data is accurate when determining problems and issues.(3CO02 Ac 1.2)

Data is essential for any organisation because it makes the business strategy run. At the same time, accurate data is one of the prerequisites because this information will allow for making effective decisions. It has an effect on several dimensions of a company, from decision-making and problem-solving through understanding and process enhancement to customer database. Besides, data provides better market understanding and enhances consumer databases, marketing strategies, and more personalized customer communication.

Accurate data is important because it forms the foundation of informed decisions. With relevant and reliable data, companies can feel more confident when making decisions; hence high levels of evidence-based decision-making as opposed to instincts. For example, according to a case study by the Harvard Business Review, Netflix applied accurate data in its decision-making in content creation and recommendation algorithms, improving customer satisfaction and retention drastically.

Organisational culture is usually key in enforcing the importance of accurate data. An accuracy-driven organisational culture values data by creating an environment that helps employees realize that reliable information may indeed drive the performance of a company. For example, companies like Google and Amazon have adopted a data-driven culture whereby their decisions are based on data analysis rather than assumption, bringing a lot of success in their respective industries.

The impact of data on the internal and external context is noteworthy. Internally, accurate data influences knowledge management methods. For instance, an organisation like IBM has utilized knowledge management systems that rely on accurate data to integrate operations and enhance collaboration among workers, resulting in improved productivity and innovation.

Accurate data thus bears externally on relations with customers and marketing strategies. For example, McKinsey & Company provides a study showing how accurate customer data helped firms create more personalized communication as a function of increased customer engagements and satisfaction.

Data accuracy is very impactful since it has a direct influence on the organisational performance. Bad data could lead to poor decisions, inefficiency of operations, and a loss of revenues among others. One famous case is the data analysis failure of Target whereby bad predictions resulted in targeting expectant mothers with ads related to babies. This was met with outrage because of how insensitive the targeting was.

The place of data in organisations and its accuracy cannot be overstated. As such, accurate data proves imperative for problem-solving, informed decisions, customer insight, and process enhancement. It impacts both internal and external considerations with major repercussions on the culture and performance of the organisation. Adopting a data-driven organisational culture coupled with knowledge management perspectives offers ways for an organisation to draw value from accurate data in driving success and increasing innovation.

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