In July 2018, McKinsey shared a few big examples of the value created by companies with well-defined data strategies. A bank is on track for $2B in benefits from a multi-year strategy, an oil and gas company is enjoying a 12-15% lift in profit margins, and over the next decade, McKinsey Global Research pegs the economic impact of data growth at $11 trillion per year.
The benefits of data growth are not reserved for behemoths. Taking advantage of the opportunity does require a different approach to data. A modern data governance – the orchestrated management of data assets to drive value for an organization – must envision data embedded in decision-making.
Consider two drivers of data governance: marketing and customer experience (“CX”) management, and the rise of data privacy protection. At first, these two forces seem to be directly opposed to each other: doesn’t better customer experience require more customer data, not less?
When viewed through the prism of trust, the paradox makes sense: customers want great service from a trustworthy organization. A data governance strategy is required to meet these customer expectations.
Marketers and accidental data governance
The pace of digital change has thrust marketers into data governance. Customers are getting used to being treated well, and they don’t tolerate excuses. Your website doesn’t talk to your order fulfillment systems? Too bad. A customer will move on.
To keep pace, marketers have adopted new technology with breathtaking speed, and in the process, became stewards of data. The harbingers of data governance frameworks appeared in marketing in the form of enterprise-wide calendars that governed emails to the customer list. As digital channels proliferated, data governance became a strategic concern for the CMO.
Risk management and the rise of data privacy
Financial services and healthcare companies have managed risk for decades. Why not just adopt what these companies are doing for your data governance framework? As Michele Goetz of Forrester Research states, “Data is too dynamic, federated, and ownership-complex to apply the same practices” as those applied by financial services firms. Instead, she implores us to “push data governance and policy execution into all the processes and automation that exist in your ecosystem.”
With the regulatory environment shifting, Goetz’s term “ambient data governance” is fitting. If you do business in Europe (GDPR) or California (CCPA) or Brazil (LGPD) – and soon, anywhere in the world – you are dealing with a new surroundings. Data governance must be built-in, ubiquitous, and reflexive. A data governance framework sets up the regimen for your practice. With enough practice, the hard work of data governance becomes automatic over time. But not unless you start.
Take more than your fair share
Ultimately, data governance is about competitiveness. Some of your competitors and peers will not start, and those companies will be the ones who don’t earn the trust of their customers and don’t get a slice of the $11 trillion. If you need help, Syntelli Solutions offers comprehensive services to help you put the fundamentals in place for the next decade of growth.