In the information age, statistics and reports are now so fundamental to decision making that only a truly brave leader would trust their instinct ahead of data that contradicts it.
The trouble is, the data that underpins the fancy charts and infographics we see nowadays is not always correct. In fact, a recent survey by Experian suggests that, on average, businesses believe almost a third of their own data is inaccurate.
Considering the importance placed on the numbers you see, that’s a scary thought. The trends, statistics, and analysis you’ve relied on for so long might just be leading you down the wrong path. So ask yourself: how confident are you in the integrity of the data you’re looking at?
Better manage your energy portfolio
When it comes to information on energy spend, the numbers are important. Depending on your industry, it can constitute as much as 30% of operating costs. Making the right decisions about your energy portfolio can therefore make a significant difference to your bottom line.
But like any other data, your energy bills are by no means immune to error. At Bill Identity, we process hundreds of thousands of energy bills every year for our clients and, in our experience, the error rates are significant. What’s more, whenever there’s a manual process involved, those data issues are compounded.
To put it simply, the more times information is keyed into any system and the more human involvement there is, the greater the chance the numbers are incorrect. Despite this, it is estimated that 75% of businesses still rely on manual or semi-manual processes for their energy procurement.
Energy audits without surprises
A good way to get some certainty over the information you’re seeing is to conduct an audit. Now you know there’s a chance the data you’ve relied on in the past may not actually be correct, a periodic energy audit can tell you what to trust and, more importantly, what not to. Make sure your focus is on the accuracy, breadth and consistency of your data, and pay special attention to where it came from. It may surprise you to learn that even sources you thought were reputable—like government departments and ministries—can post data that are out of date.
Meeting your energy goals and maintaining compliance
Many businesses these days have set public energy goals. Microsoft, for example, has committed to using 100% renewable energy by 2025, and BP aims to be net-zero by 2050. With such high-profile targets at stake, confidence in the underpinning data is imperative. Setting and achieving energy goals based on incorrect data could have serious repercussions—to both share price and overall profitability.
Sustainability reporting is also becoming a mainstream business practice. Producing these reports enables your business to focus on the reliability of the data being disclosed, and the process for obtaining it. Taking messages out to market that may not be accurate, of course, could have disastrous consequences.
Think about how much work your organization puts into price negotiations. It can take months of planning and research to prepare your position and develop scenarios. But when it comes to data on energy spend, all of those lengthy calculations could be based on incorrect information. Aside from the time wasted, consider the opportunity you might have missed: the chance to point out overcharging and negotiate a different level of supply—one that matches what your business actually needs, rather than what you believed it did.
In short, without accurate data to base your assumptions on, there is a very definite risk that you won’t secure the best possible outcome for your business.
Achieving accuracy: a few best practice tips
There really is no need to have the wool pulled over your eyes by inaccurate data. Knowing it’s highly likely your data contains errors means there are actions you can take to give you real peace of mind when you’re making decisions.
Here are a few best-practice tips to help you make your data the best it can be:
- Using robotic process automation (RPA) to process your data is a surefire way to eliminate human error and improve your data quality.
- If you’re auditing your data, don’t just focus on the facts; focus on the opportunity to improve processes.
- Don’t allow simple misunderstandings to cost you millions. Confusing something as small as imperial and metric measurements led to the costly burn-up of NASA’s Mars Climate Orbiter.
- If you can find ways to reduce the need for duplicate data entry and reconciliation, you reduce the risk of making errors.
- Keep a central log of all your data issues. Having them all in one place makes it easier to see any recurring themes and maintain a company-wide focus on data integrity.
The next time you look at a report or consider taking action based on data your business has produced, ask yourself how confident you are about those numbers. If the answer is not ‘absolutely’, then there’s a chance you might be about to make a costly mistake.