The Hidden Costs of Ineffective Data Management

Data management dashboard

Data drives informed business decisions. And informed business decisions drive the company closer and closer to its strategic goals. At least that is the theory, but in practice, data management has several moving parts – including collecting, organizing, storing, and analyzing vast information from diverse sources.

Unsurprisingly, channeling large amounts of data through your company’s data pipeline has its challenges. “Confusing” data governance policies are one of the biggest challenges cited by 82% of business leaders. In a similar survey, 45% of tech industry leaders see collecting and protecting growing volumes of data as a barrier to their company’s data management goals.

Poor data management can wreak havoc on mission-critical activities, result in costly errors, and lead to time wastage and missed opportunities. In this article, we weigh the impact of ineffective data management and share some expert insights on how to improve your data management practices with the help of a managed IT service provider.

Potential Consequences of Improper Data Management

Automation has certainly given data management a unique spin. When businesses grow, the amount of data they collect and generate grows too, and errors tend to occur when there’s no data management strategy in place. An estimated $15 million in losses occurs as a result of poor data quality.

However, the repercussions spread even further:

1. Ailing Customer Trust

Mishandling customer data jeopardizes the fragile business relationship with your clients. It creates a bad reputation for the organization and erodes customer trust, leading to customer disengagement further along. A tarnished brand image may take months if not years to rebuild.

Unfortunately, these consequences may spiral out of control, and soon, affected businesses find themselves in a financial crisis tied to lost customers and dwindling revenue. Poor data management not only has immediate implications but also cripples your chances of landing greater opportunities in the future.

2. Missed Revenue Opportunities

Missed business opportunities also stem from poor data management. A perfect example can be seen in a seasonal business, where peak sales only hit highs during certain periods of the year. When overwhelmed with too much data (or data deluge), consumer-facing businesses may fail to spot rapid shifts in customer trends and reorganize supply and demand in time.

Similar outcomes can be seen where sales and marketing representatives push less informed marketing campaigns. As it stands, more than half of marketers lack critical information on their customers, leading to generic and misinformed campaigns that lead to missed revenue opportunities. What’s more, failure to keep track of existing customer behavior due to outdated data management processes points to a higher churn rate. 

Using incorrect customer information in decision-making would leave the customer support team in a game of guesswork when it comes to resolving issues concerning a particular customer. The wait times become longer and more frustrating to the customers.

3. Operational Inefficiencies

Poor data management can cause all sorts of problems for various departments across the company. Production and finance departments are hardest hit by poor data management practices, while marketing and human resources may also suffer long-term effects.

Manual data collection, analysis, and sorting often breeds duplicate records and errors that render the data less effective. Revgenius estimates that more than 45% of records from all sources are duplicates. Collecting, analyzing, and merging duplicate records wastes precious time for the professionals involved in the cleanup process.

4. Loss of Employee Productivity

While collecting, sorting, analyzing, and storing data makes up the bulk of the work done by your analytics, cleaning up bad data obtained through inefficient means further strains their productivity. The hours employees could have spent on crucial tasks that have a profound impact on your company’s bottom line instead, go to waste. 

Working with bad data also leads to frustration. If the data management process is too complicated such that new employees take too much time to familiarize themselves with it, their productivity could decline as well.

5. Increased Fraud Risks

On top of financial risks, poor data management can leave gaps for negligent and fraudulent use of the company’s data resources. In particular, a lack of oversight brings about poor accountability. Compromised employees may take the opportunity to exploit poorly stored data, further exposing the company to cybersecurity threats.

How Managed IT Services Can Help with Data Management

Organizations generate vast amounts of data. Amassing huge volumes of data with poor management practices leaves room for costly errors. And since filtering through enormous data is a cumbersome undertaking for the internal IT department, business leaders turn to a managed IT services provider such as BoomTech to simplify the data management process. 

Besides systematic data storage, here is what to expect from your local managed IT services provider:

Proactive Security and Advanced Data Protection 

A professional managed IT service provider ensures that data is secure from unauthorized access. An MSP’s approach to advanced data protection typically starts with a comprehensive assessment of the current (and future) data protection needs.

A mind-boggling 43% of cyber attacks target small businesses with an estimated average cost of $9.44 million per breach in the US. Managed IT providers tap into their vast wealth of data protection and cybersecurity tools, from custom firewalls, 24/7 threat detection and monitoring software, multi-factor authentication, and proactive network monitoring software to name a few. This allows you to focus on running the business with the assurance that your data is well-protected.

Unlimited Access to IT Talent

Outsourcing IT services provides flexible access to top IT talent when needed. It goes without question that your data management efforts can only be good as the IT network responsible for collecting, sorting, analyzing, and storing information. Proactive managed IT services keep your systems running seamlessly by resolving issues as they emerge.

MSPs offer unlimited access to their pool of IT experts to address your needs. With a dedicated IT expert, you can optimize efficiency, sidestep downtime, and harness modern solutions to resolve issues proactively.

Never Worry About Data Loss

Your company’s comprehensive data management strategy sees its greatest test in the event of a disaster or an unforeseen outage. Part of your IT services provider’s role in data management comes in the development of a data backup and disaster recovery plan.

Here, copies of vital data from your on-site, remote assets (CRM, SaaS products, human and finance resources) and cloud resources are made available in remote storage locations and cloud storage. This data backup strategy saves copies of important data and makes swift, easy retrieval when faced with an unexpected disaster. It’s also important not to lose sight of your backups’ security, and MSPs can help keep your data safe and minimize prolonged interruption to normal business operations.

Ensuring Compliance with State and Industry Standards

The laws and regulations protecting sensitive consumer data change rapidly and may pose a challenge with keeping the company’s IT policies at par with the evolving requirements.

IT service providers understand the importance of staying ahead of these industry developments. They identify gaps and draft data management policies to ensure maximum compliance. Key departments are involved in the data policy-making process to ensure company-wide compliance with the new regulations.

Download our eBook, “Defeating the Data Deluge: Effectively Leveraging Data for Business Growth,” to turn your data into a powerful engine for success.


Data is, without doubt, a precious resource – but only if it can be analyzed and interpreted effectively to provide actionable insights. As businesses invest in data management solutions to ensure reliability, visibility, and security, it will become more viable to involve a seasoned managed IT provider to help get the most value from your company’s data resources.

Philipp founded BoomTech after moving to the United States from Switzerland at the age of 24. His clients say he operates his business like a “Swiss Clock!” because he has a very detail-oriented process that allows him to come up with a technology solution to his client’s problems no matter what it takes.

Posted in


Hear from Philipp Baumann, owner and founder of BoomTech:

    Get the latest insights and industry updates directly to your inbox every month!. By clicking "Subscribe" you agree to receive marketing emails from Boomtech. Don't worry you can unsubscribe at any time. We respect your privacy and won't share your information with anyone.
  • This field is for validation purposes and should be left unchanged.