What is Data Quality – Everything Businesses Need to Know

Register Now

By: Sagar Sharma

What is Data Quality – Everything Businesses Need to Know

The modern world is inundated with data, serving as a valuable resource for individuals and organizations to make well-informed decisions, greatly enhancing the chances of success. This suggests that having copious amounts of data is generally beneficial.

Nevertheless, this isn’t an absolute truth, as data can sometimes be flawed, inadequate, repetitive, or irrelevant to the user’s specific requirements. According to a Gartner report, poor data quality costs organizations an average of USD 12.9 million annually.

Fortunately, the concept of data quality comes to our rescue, simplifying the task at hand. Therefore, let’s delve into the definition of data quality, examine its attributes and best approaches, and understand how it can be employed to enhance the overall quality of data.

What is Data Quality?

Data quality evaluates the extent to which a dataset fulfils criteria related to the accuracy, completeness, validity, consistency, uniqueness, timeliness, and suitability for its intended purpose. It holds paramount importance in all data governance initiatives undertaken by an organization.

By adhering to data quality standards, companies can ensure that their decisions are based on reliable data, aligning with their business objectives. Neglecting data issues like duplicate entries, missing values, or outliers poses a significant risk to businesses, potentially leading to unfavourable outcomes.

In simpler words, data quality refers to the overall goodness and usefulness of data for a specific purpose. However, it also encompasses the process of strategizing, executing, and overseeing activities that involve essential quality management practices and techniques.

These measures are put in place to guarantee that the data is not only usable but also valuable and relevant for the data consumers.

Why is Data Quality Important?

Data quality is of paramount importance for several reasons:

Informed Decision Making

High-quality data ensures that decisions made by organizations are based on accurate and reliable information. This leads to better-informed choices and more effective outcomes.

Trust and Credibility

Data of good quality builds trust and credibility among stakeholders. It instills confidence in the data’s accuracy and encourages its use for decision-making purposes.

Avoiding Costly Errors

Poor data quality can lead to erroneous conclusions and decisions, resulting in costly mistakes and missed opportunities. Organizations can mitigate the risks of making incorrect choices by maintaining data quality.

Enhanced Efficiency

Clean and accurate data streamlines processes and operations. It reduces the time wasted on dealing with data errors, inconsistencies, and redundancies, leading to improved overall efficiency.

Data Integration

High-quality data facilitate the smooth integration of information from various sources. It ensures that different data sets can be combined accurately, providing a comprehensive view of the situation.

Regulatory Compliance

Many industries and sectors are subject to regulations that mandate data quality standards. Compliance with these standards is essential to avoid legal and financial repercussions.

Customer Satisfaction

Data quality plays a crucial role in customer-facing applications and services. Accurate customer data leads to personalized and targeted experiences, fostering customer satisfaction and loyalty.

Better Analytics and Insights

Reliable data is the foundation for meaningful analytics and insights. High-quality data allows for accurate trend analysis, pattern recognition, and predictive modeling.

Effective Data Sharing

When data is of good quality, it can be safely shared and utilized across departments or organizations, promoting collaboration and knowledge sharing.

Long-Term Value

Data is an asset that can retain its value over time. By maintaining data quality, organizations can ensure the longevity and usefulness of their data for future decision-making and planning.

Importance of Data Quality
Dimensions of Data Quality

Data quality assessment involves the consideration of various dimensions, which may vary depending on the source of the data. These dimensions serve as criteria to categorize and measure data quality metrics.


Completeness refers to the proportion of missing data within a dataset. In the context of products or services, data completeness plays a vital role in aiding potential customers in making informed comparisons and decisions.

For example, if a product description lacks an estimated delivery date while all other product descriptions include it, then that specific “data” is considered incomplete.


Timeliness evaluates the age of data at a particular moment. For instance, if you possess customer information from 2020, and it is now 2023, both the completeness and timeliness of the data become problematic.

When assessing data quality, the timeliness dimension wields significant influence, either positively or negatively, on the overall accuracy, usefulness, and dependability of the data.


Validity pertains to data that does not conform to the prescribed formats, rules, or procedures set by the company. For instance, when collecting customer data, a system may request the birthdate, but if the customer enters the birthdate in an incorrect format, it adversely affects the data quality.

To address this, many organizations have implemented systems that reject birthdate information unless it adheres to the pre-defined format.


Data integrity concerns the reliability and trustworthiness of information. It questions whether the data is accurate and factual.

For instance, if your database contains an email address assigned to a specific customer, but it turns out that the customer deleted that account years ago, both data integrity and timeliness issues arise.


Uniqueness is a vital data quality aspect, particularly significant in customer profiles. It can be the decisive factor that sets your company apart, leading to eCommerce sales and triumphing over competitors.

Achieving higher accuracy in compiling unique customer information, along with individual performance analytics related to your company’s products and marketing campaigns, serves as the foundation for long-term profitability and success.


Consistency in data is primarily linked to analytics, guaranteeing that the information collected from various sources aligns accurately with the specific objectives of the department or company.

Dimensions of Data Quality

Problems With Poor Quality Data

Data quality poses a significant challenge for many companies, and the extent of the problem is often underestimated. In their eagerness to swiftly collect and utilize data for real-time program optimization, organizations may overlook essential data quality assurance practices, such as setting standards and criteria.

This oversight can lead to reliance on inaccurate, incomplete, or redundant data, triggering a chain reaction of decisions based on unreliable numbers and metrics. Moreover, dealing with massive sets of big data, many organizations lack sufficient in-house data science resources to sort and correlate this information effectively.

As a result, they risk missing out on time-sensitive opportunities for optimization. A study revealed that only a mere 3 percent of executives surveyed had data records falling within an acceptable range.

Furthermore, 65 percent of marketers expressed concerns about the quality of their data, with 6 out of 10 prioritizing the improvement of data quality. The implications of bad data are far-reaching:

High Costs

Bad data quality resulted in organizations losing a staggering $3.1 trillion in 2016, according to IBM. Nearly 50 percent of newly acquired data contained errors that could negatively impact the organization’s performance.

MIT research suggests that bad data can cost organizations up to 25 percent of their total revenue.

Wrong Decisions

Relying on faulty or incomplete data for business decisions can cause teams to overlook critical information. For example, inaccurate attribution models might misallocate funds to fewer effective media vehicles, leading to reduced ROI.

Strained Customer Relationships

Bad data not only affects advertising budgets but also impacts customer relationships. Targeting customers with irrelevant products and messaging due to bad data can alienate them from the brand, resulting in opt-outs or disregard of future communication.

Problems With Poor Quality Data
To mitigate these risks and harness the true potential of data-driven decision-making, organizations must prioritize data quality, invest in proper data management tools, and adhere to best practices in data collection and validation. Only then can they unlock the value of data and gain a competitive edge in the dynamic business landscape.

Impact of Having Poor Data Quality & Importance of Data Quality Management System (DQM)

Data Quality Challenges

Data quality becomes a crucial consideration when dealing with large amounts of data, as the sheer volume of new information can impact its trustworthiness. To address this, forward-thinking companies implement robust processes for data collection, storage, and processing.

In the rapidly advancing technological revolution, the top three data quality challenges are:

Privacy and Protection Laws

Regulations like the General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA) intensify the demand for accurate customer records. Organizations must swiftly access complete individual information without any inaccuracies or inconsistencies.

Artificial Intelligence (AI) and Machine Learning (ML)

The adoption of AI and ML for business intelligence leads to continuous surges of Big Data, making it challenging for data users to keep up. The real-time data streaming platforms introduce more opportunities for mistakes and data quality issues.

Additionally, managing data systems across on-premises and cloud servers poses challenges for larger corporations, necessitating efficient monitoring practices.

Data Governance Practices

Data governance involves internal standards and policies for data collection, storage, and sharing. It ensures data consistency, trustworthiness, and compliance across company departments.

Proper data governance is essential to resolving inconsistencies within different systems, such as variations in customer names, which can lead to customer confusion.

Data Quality Challenges
By tackling these data quality challenges, companies can ensure trustworthy and reliable data, compliance with regulations, and more effective decision-making, ultimately gaining a competitive edge in today’s dynamic business landscape.

How to Improve Data Quality

For businesses seeking ways to enhance data quality, data quality management offers valuable solutions. The objective of data quality management is to implement a balanced set of strategies to prevent future data quality issues and cleanse or remove data that fails to meet data quality Key Performance Indicators (KPIs).

These actions enable businesses to achieve their current and future objectives effectively. Data quality management goes beyond data cleaning, encompassing eight essential disciplines to prevent data quality problems and improve data quality by purging inaccurate data:

Data Governance

Establishing data policies and standards to define required data quality KPIs and prioritize specific data elements. This includes defining business rules to ensure data quality.

Data Profiling

Employing a methodology to understand all data assets involved in data quality management. Data profiling is crucial due to multiple contributors adhering to different standards over the years.

Data Matching

Utilizing data matching technology with match codes to identify if multiple data pieces describe the same real-world entity. For example, recognizing that “Michael Jones,” “Mike Jones,” and “Mickey Jones” all refer to one individual.

Data Quality Reporting

Using information from data profiling and data matching to measure data quality KPIs. Reporting also involves maintaining a quality issue log to document known data issues and track data cleansing and prevention efforts.

Master Data Management (MDM)

Implementing MDM frameworks to prevent data quality issues. MDM deals with various types of master data, such as product, location, and party data.

Customer Data Integration (CDI)

Compiling customer master data from various sources, such as CRM applications and self-service registration sites, into a single source of truth.

Product Information Management (PIM)

Aligning data quality KPIs among manufacturers and sellers to maintain consistency in product data throughout the supply chain. Standardizing the receipt and presentation of product data is a significant part of PIM.

Digital Asset Management (DAM)

Ensuring the quality and relevance of digital assets, such as videos, images, and text documents, used alongside product data.

An Ultimate Guide to Digital Asset Management (DAM)

By adopting these eight disciplines, organizations can proactively address data quality challenges, optimize their data management practices, and pave the way for more reliable and valuable data-driven insights.

Data Quality Best Practices

For data analysts aiming to enhance data quality, adhering to best practices is crucial to achieving their goals. To accomplish this, they must adopt a pervasive, proactive, and collaborative approach to data quality within the organization. Here are ten essential best practices to follow:

  • Ensure active involvement of top-level management. Cross-departmental participation by data analysts can effectively resolve numerous data quality issues.
  • Integrate data quality activity management into your data governance framework. This framework establishes data policies, standards, roles, and includes a comprehensive business glossary.
  • Perform root cause analysis for every raised data quality issue. Addressing the underlying cause is essential to prevent the issue from recurring and not just treating its symptoms.
  • Maintain a data quality issue log containing details like assigned data owner, involved data steward, impact, final resolution, and timing of necessary actions.
  • Assign data owner and data steward roles from the business side and data custodian roles from either business or IT, depending on what makes the most sense.
  • Utilize data quality disasters as examples to highlight the significance of data quality. However, rely on fact-based impact and risk analysis to justify solutions and funding.
  • Build metadata management upon your organization’s business glossary, using it as a foundational reference.
  • Minimize manual data entry where possible. Explore cost-effective solutions for data onboarding using third-party data sources that provide publicly available data, such as names, locations, company addresses, and IDs. For product data, consider using second-party data from trading partners.
  • Implement processes and technology close to the data onboarding point to prevent data issues, rather than relying solely on downstream data cleansing.
  • Establish data quality Key Performance Indicators (KPIs) aligned with general KPIs for business performance. Data Quality Indicators (DQIs) can be linked to dimensions like uniqueness, completeness, and consistency to measure and monitor data quality effectively.

Benefits of Data Quality

Organizations that invest in creating high-quality data gain a significant advantage in leveraging data to make informed business decisions.

High-Quality Data Enhances Decision-Making

In today’s consumer-centric market, businesses equipped with high-quality data can make better decisions. For instance, analyzing data showing increased customer activity outside on Thursdays compared to Fridays can lead businesses to extend operating hours or offer unique promotions to attract more customers.

Improved Team Collaboration

When different departments within an organization have access to consistent and high-quality data, communication becomes more effective, leading to better team collaborations. This alignment in priorities, messaging, and branding contributes to achieving superior results.

Enhanced Customer Understanding

Good quality data enables companies to gain a deeper understanding of customer interests and requirements. This valuable insight allows organizations to develop better products tailored to meet customer needs.

Marketing campaigns can then be driven by data-based insights and customer feedback, rather than relying solely on educated guesses.

Benefits of Data Quality
Elevate Your Data Quality Strategy with Credencys

In today’s fast-paced and data-driven business landscape, the importance of high-quality data cannot be overstated. Organizations that harness the power of accurate and reliable data gain a competitive advantage, make better-informed decisions, and deliver superior customer experiences.

At Credencys, we understand the critical role that data quality plays in driving business success, and we offer transformative solutions to help organizations elevate their data quality strategy.

Comprehensive Data Quality Assessment

The first step in transforming your data quality strategy is conducting a comprehensive data quality assessment. Our team of experts collaborates closely with your organization to understand your data infrastructure, data sources, and data management practices.

Through in-depth analysis, we identify data quality issues, inconsistencies, and gaps in data governance.

Tailored Data Quality Solutions

We recognize that every organization has unique data quality challenges. Based on the findings of the data quality assessment, we tailor data quality solutions that align with your specific requirements and business objectives.

Whether it’s improving data accuracy, enhancing data completeness, or ensuring data consistency, our solutions are designed to deliver tangible and sustainable results.

Data Governance and Standards

A robust data governance framework is essential to maintaining data quality over time. We help you establish and implement effective data governance practices, including defining data policies, data standards, and data ownership responsibilities.

This framework ensures that data is managed consistently across your organization, leading to improved data integrity and reliability.

Advanced Data Profiling and Cleaning Techniques

Our data quality transformation involves advanced data profiling techniques to gain deep insights into your data assets. We identify data anomalies, duplicates, and outdated records, which could be affecting the overall data quality.

Using cutting-edge data cleaning tools and methodologies, we then cleanse and enrich the data, ensuring it meets the highest quality standards.

Integration with Existing Systems

We understand the importance of seamless data integration with your existing systems and applications. Our data quality solutions seamlessly integrate with your data infrastructure, allowing a smooth flow of data across different departments.

This integration ensures that high-quality data is readily available to support various business processes and decision-making.

Continuous Monitoring and Reporting

Data quality is an ongoing endeavor, and we implement real-time data monitoring and reporting mechanisms. Our comprehensive reporting provides actionable insights into data quality KPIs, enabling you to proactively address any emerging data quality issues.

With our continuous monitoring approach, you can ensure that data quality remains a top priority for your organization.

Closing Thoughts

In conclusion, data quality is a paramount aspect of modern business success. Organizations that invest in creating and maintaining high-quality data reap numerous benefits, including making better-informed decisions, improving customer understanding, and fostering more effective collaborations among teams.

Say goodbye to data chaos and embrace the power of PIM/MDM to supercharge your business growth!