You Ask, I Answer: The ROI of Data Quality?

Oz asks, “I have a question about what you mean about data quality can’t be sold and it’s seen as overhead? I suspect we’re talking about 2 different things but I’m curious about what you’re describing.”

In the data analytics and data science process, data quality is absolutely foundational – without it, nothing else matters. Yet companies underinvest in data quality because it’s a cost center. There’s no ROI in data quality that can easily be perceived. To the non-technical user, data is data and it’s often presumed to be correct until proven otherwise or it conflicts with your ideology/pre-determined opinion.

Lots of human prejudices get in the way. Imagine thinking you had cake flour, but you actually have said.
– “Well, we already paid for it so we may as well use it”
– “It can’t be that different, right?”
– “We’re focused on actionable insights anyway”
– “How wrong could it be, it’s from Google?”

How do you get someone to invest when they have such deep-seated flaws? You can’t, until the flawed data leads them to a negative outcome – and even then it’s unlikely they’ll accept responsibility for their decisions.

To prove the ROI of data quality, you have to leverage the scientific method and demonstrate just how different the outcomes are.

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Machine-Generated Transcript

What follows is an AI-generated transcript. The transcript may contain errors and is not a substitute for watching the video.

In today’s episode oz asks, I have a question about what you mean about data quality can’t be sold, and it’s seen as overhead.

I suspect we’re talking about two different things.

But I’m curious about what you’re describing.

So in the data analytics process, yes, data quality is its foundational, right? It’s absolutely essential.

Without it, nothing else matters, right? If you are focusing on using data, and you don’t invest in data quality, and making sure your data is clean, and correct, and comprehensive, all the the six seasons of the Data Quality Framework, you’re going to end up in trouble.

We have seen no shortage of examples of people making decisions on flawed data, especially these days.

And yet, companies and individuals are Under investing in data quality, because it seemed as cost center seen as an expense.

Even if you’re saying to people look without correct data, we can’t make decisions here.

We can’t make decisions that will be good.

They see it as something that is, should be automatic.

Right? It shouldn’t need to happen.

And well, we’ll give you some examples.

Here’s some things that people have actually said, When confronted with poor data quality.

Well, can’t be that different, right? Yeah.

Well, we’re focused on actionable insights anyway, which come from data? Well, how long could it be? It’s from Google said about Google Analytics.

And my favorite, oh, we already paid for it, so we may as well use it.

Now, imagine, when we’re talking about data quality, imagine that We’re talking about baking a cake.

And you think you bought flour.

But you actually got sand.

Right? It sounds so silly.

These excuses sound so silly, don’t they? It’s like, well, it can’t be that different, right? Well, yeah, I mean, they’re both granular, but one is sand, and one is cake flour.

If you’re making a cake, you’re probably not going to be super thrilled with the outcome of a pile of sand.

And that’s where that’s where we run into trouble.

companies make these blanket assumptions.

And I should be clear individuals at companies make these blanket decisions that data is data.

And it’s got to be correct because it’s inside of a machine, right? And I’m constantly surprised at the number of people who have these very naive, really naive perceptions that because it comes out of a machine or it comes out of Google Analytics is something that must be corrected as presumed.

To be correct.

And is also presumed not to need any cleaning because it comes from Google Analytics.

Now, don’t get me wrong, Google Analytics is a terrific tool.

I love it.

But out of the box, it’s not right.

You got to spend some time tuning it.

The same is true of all marketing data, I have yet to see a single marketing data source, that when you export the data, and you load it into the analysis tool, your choice that it’s perfect, never seen one not yet.

A lot of vendors create good data, but it still needs cleaning still needs engineering still needs quality checks.

And data quality is seen as as an added expense to the process.

Well, why do we need it? Why do we need to invest in it? Why do we need a person other than an analyst to look at this? Why does that have to happen? it’s slowing down the process.

And again, all things that I have heard many many times and have gritted my teeth Keith, as, as they’ve been said, What’s more challenging Ben is when something goes wrong.

And it does because if you make a cake with sand, you’re not going to enjoy it.

And the person who made the decisions is shown the negative outcomes.

They generally don’t accept responsibility for their choices.

They will blame something else the system, the animals who did it, phases of the moon, whatever the case may be.

And I’ve also noticed and this is a societal thing is a sign of the times that when shown how the poor quality data has performed a person some people We’ll say, well, it doesn’t matter anyway, because this is what the outcome was I was looking for, right? There is a tremendous amount of behavior in which data that conflicts with someone’s ideology or pre existing opinion is rejected out of hand.

And that makes data quality leads and harder sell.

Because if they don’t care about the outcome, or they’ve got an outcome in mind, they would rather have the data just support whatever it is that they want to believe, rather than what it actually is.

So in a lot of ways, data quality is equivalent to the level of data literacy within an organization.

The more data literate an organization is, the more data literate that the decision makers are, the more likely it is that you’ll get them to invest in data quality and see it as not a cost center, but as an investment center, one that will pay dividends down the road because it will give you correct answers or better answers than poor quality data.

In a an organization where data literacy is low, you’re going to see resistance to data quality efforts, a lack of understanding about why Data Quality Matters, and a raft of excuses about why they’re not investing in it.

They don’t need to invest in it.

And there’s no plan to to make any effort to improve data quality.

So how do we resolve this? How do we prove the ROI of data quality? In the end, it comes down to the scientific method.

Right? It comes down to Let’s run two experiments one where you have a data set, maybe you split the data set in half, you fix one half, you leave the other half alone and you demonstrate clearly here is the role and importance of data quality.

If you do it right.

You get this result if you do it wrong, get this result.

And what a difference.

There is.

Real simple example, when you’re running For example, attribution analysis, in marketing, if you don’t clean out correlates, meaning variables that are highly correlated and, and strongly associated.

It will really throw wrench into a machine learning algorithm that’s attempting to figure out what variables actually matter when it comes to whether somebody converts or not.

So if you have number of characters in a tweet and number of words in a tweet, they’re gonna be highly correlated, because they’re coming from the same data.

That will throw a false signal to an algorithm like extreme gradient boosting and it will assume that those two things are independent when they’re not sometimes and blow up your attribution analysis.

You have to know that you have to know that that’s an issue.

And so you can run an experiment Where you clean one half of the data set, you get rid of things like both karlitz.

And you demonstrate, look, look how different the results are from the same algorithm from the same data set one half clean one half not.

And it will be different.

I have run into this many, many times, it’ll be substantially different.

Another easy one to deal with near zero variables, variables have almost no variants, and are at or near zero in value.

Again, this is something that regularly hoses, machine learning algorithms, trying to do things like attribution analysis.

If you know that’s a problem, you can clean it out.

If you don’t know that’s a problem, you end up with a bad analysis.

So that’s how we prove the ROI of data quality.

We show that just how big of a difference it makes in the eventual output from the system and show just how badly your decisions could go.

If you do not invest in data quality.

Good question.

We could have a long conversation about this.

But if you have follow up questions, leave them down.

box below.

Subscribe to the YouTube channel on the newsletter, I’ll talk to you soon take care.

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