What’s Data Literacy and Why Is It Important?

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    Data has become a fundamental aspect of business operations in the growing digital-first global economy. As a result, learning how to extract, analyze, store, and use data from different sources has become crucial for driving business value. However, many businesses, especially those digitalizing their operations to make data-driven decisions don’t have the knowledge to tap into their full potential. 

    Hence, data literacy has become one of the biggest trending buzzwords in the business industry in recent years. 

    But what is data literacy? More importantly, why is data literacy important for organizations operating in the modern business landscape?

    Read on to find out!

    What is Data Literacy?

    According to Gartner, data literacy refers to a person’s or organization’s ability to extract, read, analyze, and communicate relevant data for different use cases and applications. In the post-pandemic age, it has become one of the most important professional skills in the market. 

    It empowers workers from every background or level of organization to understand and leverage the data available to them for better decision-making. This includes determining the possibilities and limitations information provides along with its geospatial context for proper utilization. 

    The best way to understand data literacy is by thinking of it as reading literacy. As students transition from lower to higher grades, they’re expected to read at a certain level of proficiency. Data literacy employs the same structure and transition. Learners gradually improve their ability to read, interpret, and analyze data. 

    In many cases, data literacy may also be referred to as the ability to leverage data analysis tools, management platforms, and visualization platforms to generate actionable insights. 

    The Importance of Data Literacy in the Modern Business Landscape

    As mentioned before, the world is gradually transitioning into a digital-first economy. As a result, data is becoming an indispensable aspect of our life since its foundation in our smartphones, appliances, streaming platforms, and every major digital touch point. 

    Similarly, data is a fundamental aspect of business operations. From financial reports to usage trends, product analytics, purchase history, personal information, and other data types, any piece of information can be used to improve your value offering or workflow. 

    Today, data is everywhere, not just in IT departments in organizations. With business intelligence becoming an essential work skill as well, most modern professionals must be able to access decentralized data on reports, dashboards, and other platforms, and interpret it to fulfill their professional obligations.

    In other words, we live in a world where it’s critical to understand how to use data for almost every personal and professional decision. For example, a simple weather report can tell you whether it’s a good idea to go out for dinner or cook at home. Similarly, it can help freight businesses readjust logistics plans and postpone/reschedule shipments to ensure safety. 

    Key Benefits of Data Literacy

    Now that you understand the importance of data literacy, let’s check out some of its most important benefits for professionals and businesses:

    Data-driven decision

    Data-driven decisions are becoming the global standard as businesses look to leverage the information available to them for more reliable and cost-effective operations and workflows. 

    For instance, if you’re looking to create a digital market campaign to reach young adults from low-income households, you can use demographic and behavioral data to extract your target audience instead of wasting your resources and time selling to everyone. 

    Converting raw data into actionable insights is one of the core aspects of data literacy. With data-driven decision-making, you can gain a competitive edge over other businesses that aren’t data-literate in terms of expenditure, reach, and return on investment.

    Improved Target Audience Knowledge

    Every business caters to a specific target audience. Hence, data collection is an essential aspect of operations. With more data-literate personnel onboard your team, you can gain deeper insights into their purchase behaviors, pain points, and journeys. Moreover, you can leverage the right tools to segment your target audience in terms of age, income, location, education, and other factors. 

    Traditionally, this has been an overwhelmingly difficult job, especially for large businesses with a massive customer base. With improved data literacy, you can accelerate and simplify the process by extracting the most relevant information related to potential buyers. 

    More Innovation and Productivity

    Most modern organizations have enabled tech-based operations by adopting different applications and software for different tasks and operations. However, investing further in data literacy improvements via recruitment, training, or technology upgrades can unlock new levels of innovation and performance from your teams. 

    At the very least, data literacy can help accelerate the learning curve and streamline processes – both factors that can improve productivity. 

    Competitive Edge

    Maintaining a competitive edge is essential for modern organizations. However, with technology evenly distributed in the market, especially among the top players in different industries, it often falls to digital literacy to separate businesses. The math is simple – the more data literate you are, the more data you can leverage and use to connect better with your clients or improve business operations. 

    Better Career Growth

    On an individual level, improving digital literacy is an excellent way to increase employability and elevate your career to strategic-level operations. With data-driven operations becoming the global standard, upskilling by becoming more data literate will benefit you in many ways, such as better pay and perks, more responsibilities, and self-fulfillment. 


    Data literacy is one of the most critical skills for modern businesses during their digital transition. As a result, many business leaders and employees are looking to become more data literate to yield actionable, custom insights to improve productivity, performance, and success. 

    So, in case you’re still pondering the question, “why is data literacy important?”, hopefully, you have your answer now. However, learning about the importance of data literacy is the first step. Taking the right measures and employing the right tools to improve it is just as important. 

    ClicData is one of the most powerful and advanced data management platforms you can use to connect, extract, authenticate, analyze, and share data. So, get in touch with our team to learn more about ClicData’s cutting-edge platform right away!

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