Data Sharing is Crucial for Smart Data-Driven Brands

testv September 17, 2024

0 8 5 minutes read

Businesses are investing more and more money on big data these days. Exploding Topics reports that American companies spent $110 billion on big data in 2021.

The demand for big data technology is going to rise as the amount of available data increases. The volume of data more than doubled between 2020 and 2024 to 147 zettabytes.

Unfortunately, some companies don’t use their data effectively. One of their biggest mistakes is not making sure that business partners and other stakeholders can share it easily with each other. We have already shared some tips on sharing big data safely, but we want to go into more detail on other best practices.

When you first hear the term “data sharing”, especially in the context of sharing valuable business data with others (even competitors!), it’s understandable to feel a bit skeptical. The concept may raise concerns about privacy or competitiveness. However, data sharing, particularly in managing business partner data like addresses, tax numbers, and financial details, is a growing trend among companies looking for smarter, more efficient ways to maintain their customers, vendors and suppliers master data.

In essence, data sharing allows companies to collaborate on maintaining and updating key business partner data. Imagine a network where companies can share updates on important information such as addresses, tax numbers, or even details on social compliance and financial stability. It’s about managing this data collectively, where everyone benefits from the shared efforts – reducing the need for every company to do all the work individually.

CDQ, a pioneer in this field, leads a trusted network of over 30 global companies that actively practice data sharing. These companies, including industry giants like Bayer, Bosch, Siemens, Tetra Pak, or Nestlé, work together to set common quality standards, develop sustainable data quality rules available out-of-the-box, and access trusted data sources. Through collaborative approach to business partner data, they are improving data accuracy and are cutting down the time and cost involved in maintaining high-quality data.

Let’s face it: keeping up with the constant changes in business partner data is tough. Addresses change, tax numbers expire, and companies face financial challenges. Trying to keep up with these changes is a daunting task for any single organization. But when companies collaborate through a data-sharing network, it becomes much easier. This in turn helps create a culture that makes data-driven decision-making easier.

Instead of each company individually verifying the same information, companies in the CDQ Data Sharing Community work together to keep data accurate and up to date. One company might update a vendor’s address, and others in the network will automatically receive that update. The result? Less manual work, better data quality, and faster access to reliable information.

But it’s actually more than just trusted data. Data sharing companies also tap into shared knowledge, best practices, and enriched data from trusted sources. This collective approach helps businesses stay ahead of changes and ensure their data remains fit for purpose – at any time.

Deloitte’s Chief Data Officer Playbook highlights the power of data ecosystems in driving efficiency and innovation across sectors, reinforcing how sharing trusted, high-quality data can boost decision-making and mitigate risks.

Data sharing offers tangible benefits that make the business case for it hard to ignore. Here are some of the key advantages:

1. Improved data quality: By pooling resources, companies in the CDQ network benefit from higher data accuracy. Updates are verified and shared by multiple parties, ensuring that business-critical information remains correct across the board.

2. Cost efficiency: Maintaining high-quality data is costly—whether you’re paying for external validation tools or dedicating staff to handle manual updates. Through data sharing, companies can reduce these expenses, with some businesses saving up to 60% on data maintenance costs.

3. Faster automation: Data sharing helps businesses automate processes that rely on accurate information. Whether it’s procurement, logistics, or sales, having access to timely, validated data leads to fewer errors, smoother workflows, and a significant reduction in time-consuming manual interventions.

4. Risk reduction: With access to high-quality data, companies can better manage risks—such as avoiding supplier fraud or ensuring regulatory compliance. Sharing up-to-date trust scores and financial data allows for early detection of potential risks, helping businesses make more informed decisions.

The concept of data sharing might sound complex, but it operates on a simple principle: trust. Companies collaborate in a secure, governed environment where data is shared in real time, ensuring privacy and control over sensitive information. Here’s how it works in the CDQ Data Sharing Community:

Shared knowledge: Community members collaborate to define best practices and maintain a common “language” for managing data. This includes creating shared data quality rules and ensuring consistency across companies.

Shared data sources: By tapping into shared external data sources—like public corporate registries or commercial databases—companies receive regular updates on business partner data without having to manually connect and manage each source individually.

Shared data: Every time a company in the network updates a data record, that update becomes available to the other members. This real-time sharing ensures that everyone has access to the most accurate data, reducing the time and effort spent on validation and corrections.

The numbers speak for themselves. For instance, companies using CDQ’s cloud-based platform report a reduction of up to 60% in data maintenance costs. A major factor in these savings is the ability to tap into a shared data pool, where an average of 43% of customer records already exist—saving time on manual data entry and validation. Additionally, process efficiencies, like fewer delivery errors and smoother procurement workflows, add even more value.

By using high-quality, shared business partner data, companies also make better decisions. With accurate data, you can conduct more precise customer segmentation, streamline purchasing decisions, and reduce risks like invoice fraud.

Data sharing is more than just a trend. It’s a practical solution to one of the biggest challenges companies face – managing ever-changing business partner data. By working together in a trusted network, companies can share the load, cut costs, and improve data quality across the board.

As the CDQ community continues to grow, more businesses are realizing the advantages of collaborative data management. Whether you’re struggling with data quality, facing increasing data management costs, or simply looking for ways to enhance your operational efficiency, data sharing could be the solution.

The best part? You’re not alone in this journey: you’re part of a network of companies that value trust, quality, and collaboration. As more companies, from industry leaders like Siemens and Nestlé to smaller firms, embrace data sharing, the question isn’t whether you should join—but when. The future of data management lies in collaboration, and by joining this trusted network, you position your business to thrive in a data-driven world.