What is Data Literacy?

Definition

A data literacy skillset is the ability to read, comprehend, create, and communicate data as information.

A data literacy skillset is the ability to read, comprehend, create, and communicate data as information. Similar to literacy as a general concept, it focuses on the skills required for working with data.

By becoming data literate, we can use the massive amounts of information at our disposal to make fact-based decisions. Data literacy is not limited to data scientists or analysts. As a matter of fact, data is a subject that encompasses a wide range of skills, tasks, and responsibilities.

It isn't about coding and complicated tools or programs, but about mastering three important skills:

  1. Data is all about gaining an understanding of its basic concepts, how it is collected, and what is possible with it. Sometimes the limits of what can be done with the data are even more important.
  2. As data comes in many shapes, colors, and sizes, it can be acquired across an array of sources and it can be incomplete or complete. Knowing how to process data and deal with its flaws, you can shape it for your personal use case.
  3. For the analysis of data to be successful, basic statistical knowledge is essential. Knowing the most common statistical methods is vital to understanding what questions to ask and how to interpret the results.
  4. In order to visualize and comprehend all the data and information, as well as convey the results to colleagues, great communicators are needed. Data translators and data visualizers, skilled at conveying data insights, are two popular and increasingly relevant roles held by employees across departments.

Why is Data Literacy important?

Considering how important alphabetical literacy was for society centuries ago, Data literacy has been called the most critical 21 st-century skill. It is the most essential skill for working reliably and critically with analytics and their insights. Within an organization, everyone who make decisions, reports, or recommends policies should be able to use it.

A lack of data literacy costs employers an equivalent of 5 productive days per employee. Translating to billions of dollars in lost productivity per employee each year.

There is no doubt that companies are collecting more data than ever before, and it has been proven that smart data enables companies to make better decisions, gain visibility, streamline processes, increase productivity, and drive higher profits. As a result, data literacy has become a core competency for all employees.

But even if organizations have recognized the benefits and the necessity of a holistic data understanding, upskilling an entire workforce doesn’t come easy.

It can be challenging to upskill an entire workforce even when organizations are aware of the benefits and necessity of a holistic data understanding. Therefore, it's not surprising that most organizations are still struggling to equip their workforces to effectively use all this data.

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