Small businesses are growing commercial entities. This growth depends on many factors. The most common factor is a decision or strategy. If it’s realistically progressive, a small company will shortly transform into a large business entity. If thoroughly examined, you will find that decisions are driven by facts and statistics. Simply put, data guides decisions these days because they can prove game-changers. So, the moral of the story is that data is precious, and its handling is more significant. If it’s incomplete or obsolete, the driven decisions won’t provide realistic results.

The global data management market is going to scale up to $136.4 billion by 2026. It shows the growth rate of CAGR, which is 10.5% from 2019 to 2026, according to Fortune Business Insights. This growth indicates that more and more businesses are recognizing how vital data management is.

Let’s share the vitality of data management services for small businesses.

The Importance of Data Management

Typically, data management involves not only handling data but also collecting, storing, and then using it securely for a purpose. Small businesses primarily collect data from customers and also from sales or financial transactions. These details help in discovering insights into the target market or customers. These insights help in making guided decisions and business strategies.

Why Data Management Services for Small Businesses?

Now that you know what data handling involves, let’s understand why data management services are must-haves for small businesses.

Improved Decision-Making

Did you know that companies driving decisions through data are three times more likely to make significantly improved decisions, according to a study by PwC? This fact proves that data-driven decisions are crucial, especially for small businesses. Outsourcing data handling services can also be thought of as an alternative to hiring experts for deep data analysis and insights.

Cost Efficiency

Since data handling involves many sub-processes, it can be costly. And small entities have to maximise profit with limited resources. In this case, hiring a third-party specialist also allows businesses to access and leverage advanced technologies and expertise-driven insights. So, the cost associated with hiring and training specialised staff can never be the same as outsourcing. Deloitte found that 59% of businesses found cost-cutting to be the main reason for outsourcing. With outsourcing support, it would certainly be an affordable choice to increase profit margins.

Enhanced Security

Data security is a significant concern, and it should be because 43% of cyberattacks target small enterprises, according to Verizon’s Data Breach Investigations report. Some leading outsourcing data management service providers consider it a priority. Companies like IBM deploy the latest security measures and systems to manage data effectively. These outsourcers put all their effort into minimising the risk of breaches and managing compliance with data protection regulations like HIPAA and GDPR.

Scalability

Small enterprises continue to evolve, which also evolves the needs or requirements for professionally managed datasets. Outsourcing data management service providers are mostly preferred for being able to handle demand to scale up or down data according to requirements. Technically, this is related to scalability. Businesses may have to handle increasing data volumes, which these outsourcing partners assist with. This alternative does not require small companies to invest a considerable amount in data-compatible, secure infrastructure.

Focus on core competencies

Because of a lack of resources and inadequate capital, small business owners and their staff have to wear multiple hats. So, they remain overburdened, mostly. Outsourcing enables them to offload non-core tasks and focus on core objectives and strategic initiatives. These practices bring a boom in productivity and innovation, which eventually drive these companies to growth.

Now that you know why to hire a specialist for handling data, let’s come across common outsourcing data management services that are widespread.

Outsourcing Data Management Services

Here are some effective outsourcing services for handling sensitive corporate records:

Access to Expertise

The very first service is associated with expertise. Outsourcing units specialise in specific domains. Let’s consider the case of data management. Outsourcing companies hire specialised and trained in-house data specialists. So, it is effortless to access specialised data management skills, which always ensure high-quality data with completeness and 99.99% accuracy to be delivered.

Advanced Technology

Those who specialise in data management as an outsourcing company invests in the latest technologies. Considering the latest ones, machine learning and artificial intelligence are the most sought-after technologies that outsourcing companies use. By incorporating one of them, small businesses don’t need to spend on them. They can leverage their advancements. This certainly impacts the quality of the quality of data processing and analysis. Gartner reported in this regard. It found that cloud-based data management solutions can cut the cost of ownership by up to 30%.

Compliance and risk management

A business owner should comply with data regulations responsibly. Non-compliance can result in unbearable penalties. Also, it can degrade your reputation. Outsourcing companies never skip following relevant regulations, which eventually helps in mitigating the risk of penalties.

Potential Challenges and Solutions

With benefits come potential challenges. Here, you can find potential challenges and how to deal with them when hiring a third-party data management expert.

Data Privacy Concerns

For sure, data management involves the exchange of sensitive information with a third-party provider. You cannot skip this practice, as your core objective is to manage data itself. So here, addressing this challenge is the concern. Businesses should prefer reputed companies to incorporate for secure data management. In this regard, the seeker should establish clear guidelines in the SLA to mitigate this risk.

Integration Issues

The next risk is integration. With incompatible systems, you cannot integrate an outsourced data management service provider’s system. So, you should consider it a priority to check the compatibility of data systems for seamless integration and data flow. Apart from this, frequent communication is also required to overcome technical barriers during data integration.

Dependence on Third Parties

The third challenge is developing dependence. If you’re fully dependent on a third party for handling small to large data management issues, it can be risky. So, always choose the one who has an excellent track record and is ready with a recovery plan for business continuity.

Conclusion

Small businesses should invest in data management services. The reasons are obvious. These can be easy access to expertise, advanced technologies, and robust security measures without bearing significant costs. There are more benefits and potential concerns that you can read about and discover above.