Assets – so the received wisdom went – resided in the physical realm, often with a clear, insurable value attached. Data, on the other hand, was simply a waste product of transaction processing, its strategic value unheard of and unexploited.
The rise of the knowledge economy has changed all that. The latent power of data is well understood, with technologies such as data warehousing and business intelligence enabling organisations not only to understand but to maximise the potential value of their corporate and commercial data.
Aspects of business that were once driven by experience and gut feeling – demand forecasting, performance analysis and market positioning, to name a few – are now enabled by crunching the data.
Data now governs both the quality of products and services on offer, and the efficiency of internal business functions. But if fortunes can be won on the strength of commercial and corporate data, they can also be lost. The old adage still stands: ‘garbage in; garbage out’. Quality business processes, products and services can only be achieved through quality data. It is not enough that this data should be both trusted and, more importantly, trustworthy: it must also be accessible to those who legitimately require its use and secure from those who do not.
The need for a strategy
As such, businesses wishing to maximise the promise that their corporate and commercial data undoubtedly holds must develop the processes necessary to efficiently, accurately and safely capture, store and maintain data across the organisation: in short, they require some kind of data governance strategy.
Never before has this issue been more pressing. Regulatory and commercial pressures, coupled with technological innovations, are driving up the volume of data both generated and retained by businesses of all sizes. Among others, the renowned Sarbanes-Oxley
Act, the Payment Card Industry Data Security Standard and the financial services directive MiFID require global organisations to handle enormous volumes of data in a prescribed way.
Meanwhile, Europe-wide data retention legislation – plus laws such as the Freedom of Information Act and Data Protection Act – require organisations to protect, purge or make publicly available other kinds of data on an ongoing basis. In this saturated legislative environment, organisations must have an intimate understanding of the location and profile of their key data, at all times.
As this Information Age Research Report on data governance – undertaken in conjunction with data quality software provider DataFlux – reflects, these issues are not lost on IT directors and corporate executives. Among the research’s most heartening findings, for example, is that a significant majority (68%) of the 279 organisations surveyed already invest in their data as a strategic asset. But the recognition that this strategy should be taken one step further, forming part of an overall enterprise-wide programme by which data is securely managed, was less widely recognised.
Indeed, the relative immaturity of data governance as a concept – let alone a technology-enabled strategy – was evinced by what was an extreme range of responses. While 42% of organisations could proudly claim to operate a formal data governance approach, nearly 10% of respondents had either not encountered or had demonstrated no understanding of the term.
That highlights a surprisingly wide spectrum, with data-driven organisations blazing a trail at one end and cynicism and a lack of knowledge at the other. The dismissive suggestion by one respondent, for example, that data governance is merely a “buzzword that marketing people use to scare management” indicates that, despite progress in many areas, data governance still has some way to go before it assumes widespread acceptance.