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How business and IT can overcome the data governance challenge

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(Image credit: Image Credit: Geralt / Pixabay)

The IT department has long been the custodian of data within businesses but, as we enter a new age of data exploitation and governance this needs to change. It is critical that organizations bring IT and business leaders together. Everyone from executives down must re-think their data duties and assume higher levels of data accountability, if organizations hope to meet the growing data governance challenge and unleash the full potential of data. 

Firstly, we need to agree on what we mean by data governance. The value of data hardly comes as a surprise to any mature organization, and data governance put simply, is the process of managing the availability, integrity, security and usability of this. This allows organizations to plan how and when they use data so that it is handled consistently throughout the business. 

It is important because effective data governance ensures that data is trustworthy and consistent and, perhaps more importantly, does not get misused. This is crucial as organizations find themselves facing new data privacy regulations, and they are increasingly relying on data analytics to help drive important business decision-making.

In the past, data governance mainly involved cataloging data elements to support search and discovery without any real grasp of their meaning, relationships or value to the organization. As a result, the costs of controlling risk often became needlessly excessive. Low-value and business-critical data could easily fall under similarly stringent security requirements, and risk could even go unrecognized without proper understanding of the rules that apply to data.

In addition, opportunities to drive business agility were missed too. It is difficult, after all, to make big corporate decisions based on data that cannot be traced back to a reliable source. For many businesses it was also challenging to plan change, because the impact of data on people, processes and systems was not properly understood.

Loss of potential

Data has the potential to offer businesses unrivaled insight and it can be one of the most valuable and important assets within an organization. After all, many organizations would pay hefty amounts to really understand their customers and gain insight into what drives purchase decisions. However, the amount of data requiring analysis and interrogation continues to grow to mind-blowing dimensions – and it can quickly become a nightmare if businesses don’t have a process in place. 

The collective sum of the world’s data is projected to reach 175 zettabytes by 2025 - according to the Data Age 2025 report by IDC. The same research reveals that enterprises around the world will carry the burden of handling more than 97 percent of that big data. But right now, less than 0.5 percent of data is analyzed and used. Continuing at that rate in an increasingly information-rich world would represent a tremendous loss of potential to businesses, even as they devote more time and resources to collecting and storing data.

But businesses are waking up to this huge challenge, and they are finally collaborating with IT to meet this head-on. One of the main obstacles, is that of establishing a formal data governance strategy. A lack of resources, difficulties in proving the business case, and challenges in getting senior management to see the importance of such an effort ranked as the top three hurdles, according to a survey by First San Francisco Partners.

However, the defining principles of modern data governance help address these and other pressing issues. This more mature stage of data governance is marked by the idea that everyone within the organization collaborates in the process, spreading responsibilities across more individuals as well as senior business leaders – to show return on investment, from limiting data exposures, through to driving data opportunities and more revenue.

Strategic initiative

Business heads and their teams, after all, are the ones who have the knowledge about the data – what it is, what it means, who and what processes use it and why. As well as what rules and policies should apply to it. Without their perspective and participation in data governance, the enterprise’s ability to intelligently lockdown risks and enable growth will be seriously compromised. However, with their engagement, sustainable payback will be achieved and the case for continuing commitment by the enterprise to data governance will be easier to justify.

It is vital, however, that modern data governance is a strategic initiative. A data governance strategy is the foundation upon which to build a muscular data-driven organization.

Appropriately implemented – with business data stakeholders driving alignment between data governance and strategic enterprise goals and IT handling the technical mechanics of data management – the door opens to trusting data and using it effectively. Data definitions can be reconciled and understood across business divisions, knowledge base quality can be guaranteed, and security and compliance do not have to be sacrificed even as information accessibility expands. Companies can set themselves up to be agile in supporting change without creating legal, reputational or financial risk. But there is a time-critical urgency to reaching this point as organizations increasingly become the sum of their data.

Incredibly, data has still not generally been accorded the same thorough attention that is given to “live” strategic assets, such as physical plant equipment or tools, which are relentlessly tracked and scrupulously maintained to keep the business running at peak performance and this is something we need to change now. 

Businesses that cannot reliably define, classify, track and audit private data and enforce protections around it will take a hit, as was the case with a well-known financial services provider whose staff appropriated customers’ information to open credit cards in their name without their knowledge. That firm faced more than a dozen investigations, inquiries and lawsuits and saw its credit card applications and checking account openings plummet in the aftermath of the revelations. 

The reality is that data governance is everybody’s business and now is clearly the time for business personnel to take a leadership role, by working with IT to discover, understand, govern and socialize data for the benefit of the entire organization.

Danny Sandwell, data governance strategist, Quest

Danny Sandwell is an IT industry veteran who has been helping organizations create value from their data for more than 30 years.