Quick Question: Does your organisation list business data as an asset on its balance sheet? What about its asset register?
The answer is probably not.
Valuing intangible assets is always rife with determining which methods will accurately reflect the assets true market value. We see this with understanding the value of intellectual property; but if Gartner are to believed a global change in thinking is imminent which will create opportunities for organisations prepared to take a long view:
"Those in the business of valuing corporate investments, including equity analysts, will be compelled to consider a company’s wealth of information in properly valuing the company itself.” - Douglas Laney, VP, Gartner
So with change on the horizon why do organisations need to care about their data?
Good question and best answered by a diagram. Below is my version of a BI / Data maturity model. Organisations need to start at the Q; which equals data quality, which consists of many different dimensions (e.g. accessibility, accuracy etc). From here most businesses can determine reporting based on what has happened (i.e. a past orientation.) This usually looks like normal board or business reports and dashboards or variations on that theme - stuff we see daily within our businesses.
The future orientation is where most businesses want to be and need to be.
This is where they are prepared for future changes by working through scenarios using machine learning, predictive analytics and AI. But barriers lay in the way as symbolised by the gulf of disruption. Organisations are hamstrung by lack of clearly outlined business strategy, misalignment of internal people capability or capacity, messy or poorly documented processes and reduced ability to leverage technology let alone the data it produces to benefit decision making.
So why develop your data asset?
1. To innovate, wins
If you are on the left of the above diagram while your competitor has put effort in and moved to the right; they are better positioned to beat you through innovation; insight is the currency of innovation. Moving away from low value repetitive reporting to developing 'what if' scenarios will reduce risk, allow for creativity in thinking and help businesses put effort into what drives value.
2. From data to insight, fast counts
Organisations transform data. The process of transforming raw data into insight as basis for making decisions will become a key differentiator between your business and your close competitor. How fast an organisation executes this trans-formative process will be a measurable and demonstrable component of how agile, adaptive and responsive your company is to external pressures and internal changes.
This process should be key to all stakeholders - owners, investors and board members. Getting to grips with the transformation process can help identify opportunities, predict threats and patch weaknesses, while building on an organisations strengths. Organisation leaders need to be conversant in asking the right questions and getting the right metrics in place to understand progress.
Notebook - if you want to check out the actual size of what we are talking about; check out this info-graphic from DOMO - Data Never Sleeps 5.0 or Forbes sum up of there being 2.5 quintillion bytes of data. This is the just the data we create on our biggest platforms; so it's not a leap to suggest that our organisational data creation is following in social's footprint. As the data grows, so does the headache of having to manage it.
3. Data starts with people
Although our processes and technology produce the data both with and without human intervention; treating data as an asset (DaaA) starts with people being invested into the outcomes of what data can provide them. Senior leaders need to invest in their own education to shape what good looks like across:
People capability (e.g. data stewards, architects, visualisation experts),
Process / governance (e.g. steering committees as part of master data governance) and,
Technological delivery (e.g. selecting the best data analytics tool(s) etc).
Organisations need senior evangelists (e.g Chief Data Officer CDO) who are going to develop the data vision and bring everyone - from boardroom to basement - on the journey.
As traditional businesses environments play catch up with the changes in the market, data - and everything that pertains to - will become vital. Ensuring that your organisation is equipped to make the change from data to insight in a fast and useful way will not only separate your business from the average players out there, it will become a mechanism for understanding how agile, adaptive and responsive your organisation can be.
This will more and more become a key factor in understanding the value your organisation can provide and should be key to board members, owners and investors. But data starts with people - raise the game by getting your data champions to bring the business on the journey and develop a resilience across your people, process and technology. There is nothing to lose and everything to gain.
Tania Armstrong is the co-founder and CEO of STATE3 New Zealand. She is a dedicated business developer and strong relationship builder. Her focus is always on ensuring organisations get what they require from technology solutions, operationally and strategically. She has successfully co-founded and exited a Business Intelligence Organisation prior to co-founding STATE3. Tania is a Chartered Director with a strong affinity with data and governance and is currently completing a Masters in Information Governance.