What Is a Single Source of Truth, and Does Your Business Need One?
Ask three people in your business for a customer's phone number. Then compare the answers.
Sometimes they match. Often, however, one comes from the CRM, one from an email and one from a spreadsheet. Each looks right, but only one is.
That is the situation a single source of truth is meant to prevent. The phrase sounds technical, so this article explains it in plain words first. Then it asks whether your business needs one. Finally, it shows how to agree one without a big project.
What a single source of truth means
A single source of truth is one place that everyone agrees is correct for a given kind of information. Other places may show the same detail. However, they are copies, so the agreed record wins if they differ.
Note what it is not. It is not a product you buy. Nor is it one giant database that holds everything. Instead, it is an agreement about which record to trust.
Public sector guidance describes the same idea in its own terms. For example, the Government Data Quality Framework lists dimensions of data quality. Two matter here.
- Uniqueness: each entity should have one record, with each value stored once.
- Consistency: values for the same entity should not contradict each other.
Likewise, the Department for Education's enterprise architecture principles advise using “authoritative data sources without creating copies” to keep data consistent. They add that duplication reduces trust and introduces errors. Both documents were written for the public sector. Even so, the thinking carries over to any business.
Signs your business does not have one
Most businesses will recognise at least some of these.
- Two people give two different answers to the same question.
- Someone says, “Don't trust the CRM, check the spreadsheet.”
- Reports from two tools disagree, and nobody knows which to believe.
- People keep their own private copy because they do not trust the shared one.
- Updating one place means remembering to update three others.
The last two signs feed each other. When people stop trusting the shared record, they keep private copies. As a result, the shared record falls further behind.
We cover how records fall behind in Why Your CRM Data Is Out of Date Before the Week Ends.
Does your business need one?
Usually, yes, but in a smaller form than the phrase suggests. You do not need one record for everything. Instead, you need one agreed record for each kind of information that matters.
Common kinds include the following. This list is an illustration, so adapt it to your business.
- Customers and contacts.
- Work in progress, such as jobs, orders or cases.
- Money, such as quotes, invoices and payments.
- Products, stock or services.
- Staff and their availability.
Next, ask three questions about each kind of information:
- How many places hold the same detail today?
- How often do those places disagree?
- What does it cost when they do?
A one-person business with a single spreadsheet may already have one. In that case, there is nothing to build. On the other hand, a team of five with details in four places probably needs to choose.
A single source of truth is not a single tool
This is the most common confusion. Many assume the answer is one system for everything.
However, different tools can each be the agreed record for a different kind of information. For example, the CRM might be the record for customer details. Meanwhile, the accounts system might be the record for invoices.
The two then need a clear link, such as a shared customer reference. In this way, each tool wins in its own area.
If you are weighing how many tools to keep, How Many Business Tools Does a Small Business Actually Need? offers a way to count jobs instead of tools.
Three steps to agree one without a big project
You do not need new software to begin. Instead, you need three decisions. These steps are our own practical suggestions, not research findings.
1. Name the home for each kind of information
For each kind, choose the one place that wins. Choose the place people already use most, where that is sensible. Otherwise, if nobody uses it, the agreement will not hold.
2. Decide which way the information flows
Enter each detail once, in its home. Then treat every other version as a copy. If the details must appear elsewhere, they should come from the home, not be retyped.
3. Agree what happens when two places disagree
Write one short rule. For example: “If the CRM and the spreadsheet differ, the CRM wins.” Then update the spreadsheet. Also, name one person who owns each record.
Finally, tell the whole team. After all, an agreement nobody has heard of is not an agreement.
Common mistakes
- Choosing a tool before agreeing the rule. As a result, the tool decides what counts as true.
- Trying to cover everything at once. Instead, start with the information that causes the most disagreement.
- Declaring a record the winner, but making it hard to update. Then people will go around it.
- Forgetting the human step. Someone must still update the record close to the moment things change.
- Leaving old copies in circulation. Retire them or mark them clearly as copies.
The fourth point is where many efforts stall. After all, the agreed record is only as good as the habit of keeping it current.
Where technology helps
Once the agreement exists, technology can support it. For example, a connection can copy a changed phone number from the agreed record into other tools. Alternatively, it can flag likely duplicates for a person to check.
However, technology repeats whatever it is given. So if two records disagree and no rule says which wins, a connection simply spreads the confusion faster.
The same is true of AI tools. They work from whatever they can see, so conflicting records can lead to conflicting answers. Therefore, clear records come first.
For more on where AI belongs, see Where AI Should and Should Not Sit in a Small Business Process.
An illustration: choosing the agreed record
This example is invented to show the idea. It is not a client story.
Imagine a small services firm. A customer's phone number sits in the CRM, in the invoicing tool and in an old spreadsheet. However, the three do not match.
First, the firm agrees that the CRM is the home for contact details. The invoicing tool is the home for invoices. Next, it writes one rule: if they differ, the CRM wins. Then it names an owner for each.
Finally, it retires the old spreadsheet. Only after that does it look at connecting the CRM and the invoicing tool.
In that order, the technology supports an agreement that already exists.
Where this fits with the rest
An agreed record is one part of a connected business. First, map the process. Then choose the home for each kind of information. Finally, decide where technology belongs.
Related reading, depending on where you are:
- When Does a Small Business Actually Need a CRM? covers the first-CRM decision.
- Does Your Business Need a New CRM or a Clearer Process? helps you decide whether to replace or reconnect.
- Has One Employee Become Your Business's Unofficial Operating System? explores what happens when the record lives in one person's head.
You can also see a connected process in practice in the Bridging Loans Broker case study.
Frequently asked questions
What does single source of truth mean?
It means one place that everyone agrees is correct for a kind of information. Other places may show it, but they are copies. So if they differ, the agreed record wins.
Is a single source of truth a software product?
No. It is an agreement about which record to trust. Software can support it, but it cannot create the agreement alone.
Does every small business need one?
Most benefit from one agreed record for each important kind of information. However, a very small business with one spreadsheet may already have it.
Can I use a spreadsheet as the agreed record?
Yes, if everyone uses it and one person owns it. However, it becomes risky when copies multiply or only one person understands it.
What if two systems disagree?
Decide in advance which wins. Then update the other and note why they differed. Over time, those notes show where the gap opens.
Start with the business
Before you buy, connect or automate anything, it helps to know which record you trust and why. The Davina Connect Business Review looks at people, information, systems and processes together. The recommendation never starts with a tool.
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