Data strategy optimizes middle market success
Any business that fails to develop and continually evolve its data strategy will ultimately suffer a profound truth. It will never realize its full potential. The company will endure the struggles of a constant reactive state to its data issues. A ransomware notice creates an immediate need for better data security. Disparate data sources drive a need for additional headcount to make up for the lack of an integration. Inferior business applications have not captured critical data required for evaluating the profitability of possible future revenue streams. A major storm brings corporate-wide attention to the lack of business continuity preparedness within its overall disaster recovery plan. A good data governance strategy will have considered each of these examples and many more. Unfortunately, most businesses do not treat their data as a strategic asset.
All companies should plan how they protect and use their data. Though in most cases, implementing a formal data governance plan only occurs when a company reaches a size where cross-function procedures are no longer proficient. Although most businesses have some form of data governance for individual applications and departments, it is not typically comprehensive across the entire corporation. Well-developed planning needs to include the people, processes, and technology required to govern and protect the organization’s data assets. This in turn will make data management consistent throughout the business, which supports the overall achievement of the company’s business objectives.
So, the IT department needs to be the driving force behind this strategy, correct? Not exactly. The IT department plays a major role in protecting a company’s data, but it is the corporate leadership team’s responsibility to determine what data is valuable and how to leverage that data for the benefit of the business. As users of the data and leaders of the information worker staff, they are most knowledgeable of what data is key to the company’s operations. Once determined, the IT department can then design and support a proper data management approach by implementing the data management structure necessary to meet the data governance objectives.
Data governance’s essence is about identifying what data is important and establishing clear responsibilities and processes to standardize, integrate, protect, and store this strategic organizational information. The key objectives are to:
- Increase data value
- Diminish risks
- Establish rules for data use
- Implement and enforce the policies necessary for data usage compliance
- Ensure the ongoing existence of the organization through risk management and system optimization
- Improve internal and external communication
- Establish and monitor the mechanisms required to reduce the costs of data management
A proper corporate data governance plan is a comprehensive, formal control mechanism that will allow a business to extract strategic value from an inexhaustible and durable asset, its data. Successful middle market organizations understand their data strategy is a prerequisite to greater profitability and overall business value optimization.