What is data literacy and why is it important?
There is a lot of noise about data literacy at the moment, but do you really know what it is?
Let’s start with the most well-known and repeated definition from Gartner.
According to Gartner, data literacy is…
“Having the ability to read, write and communicate data in context, including an understanding of data sources and constructs, analytical methods and techniques applied, and the ability to describe the use case, application and resulting value.”
This is quite a complex definition that really lends itself to data professionals who already know they are data literate. However, data literacy should be something that transcends all job roles so let’s break it down.
The core of data literacy is the ability to read, work with, analyse and argue with data.
All roles in your organisation should be confident in receiving and interpreting data outputs, such as reports, to make better decisions and defend these decisions. This may be as simple as identifying the winner of a marketing test through to more complex applications such as optimising customer services support hours to reduce wastage.
Gartner then talks about understanding the data sources and constructs. More simply, this is about understanding what data you actually have available in your business. If you don’t really know what data you have available, you cannot use it. A basic understanding of your ecosystem can help business users go a long way to improving conversations and ideas around using data.
Onto understanding analytical models and techniques. Again, a business person is not going to be expected to start building analytical outputs, but understanding different types of analytical techniques can aid in improved briefing, interpretation and application of analytical outputs. For instance, if I ask a data scientist for an analytical model without understanding the different approaches, I won’t know if the solution is fit for purpose or how it may unleash the opportunities I want to solve.
The final stage of the Gartner definition is to all intents and purposes, the ability to describe the application of any data outputs, and the subsequent value the application has generated. So being confident at interpreting data models and metrics is really key.
What skills does “being data literate” require for a business professional?
Here, we are looking at the fundamental skills of a business professional. Many sources will tell you that to be fully data literate you need to be an expert in every aspect of data from database design to statistics and coding in Python but we would advocate leaving that to the data professionals and focusing instead on the broader business use of data which comes down to these core areas:
Critical Thinking: Develop the ability to ask the right questions about data, evaluate its quality and reliability, and identify any biases or limitations. Critical thinking helps in drawing accurate conclusions and avoiding misinterpretation.
Data Interpretation: Acquire the skills to extract insights from data, identify patterns and trends, and make data-driven decisions. This includes understanding statistical significance, causation vs. correlation, and different types of data distributions.
Communication Skills: Learn how to effectively communicate data-related information to different audiences. This includes storytelling with data, using clear and concise language, and presenting findings in a compelling manner.
Why is it important?
Data literacy is increasingly important in today's data-driven world. It empowers individuals to make informed decisions, identify patterns and trends, solve problems, and communicate insights to others.
As said so well by author and data science expert Piyanka Jain:
“Everybody needs data literacy because data is everywhere. It’s the new currency, it's the language of the business. We need to be able to speak that.”
The global data landscape is not getting any smaller. More and more businesses are reliant on data to drive their business, and individuals with confident data literacy skills will be the ones to win in this data-populated world.
If you need support with improving data literacy in your business, please get in touch with us at email@example.com.