Are your Data Assets more of a Liability than an asset?

The term “data asset” is thrown around by companies when discussing analytics, digital strategy, MDM, the Internet of Things, and other emerging data topics. For many companies, and individuals, data is becoming more of a liability than an asset.  An asset, in simplest form, is something that is useful or has value. When we look at data as an asset, we consider the value it brings in terms of understanding our current situation, historic trends and ideally predicting the future. This is true whether you are looking at your step tracker data, weather app, or you are running predictive models to assess the success of your marketing strategy. The key point is that you are using the data to extract value. If you are not getting value from your data, it becomes a liability. 

How data becomes a liability?

Something becomes a liability when you become responsible for it. This applies whether we are talking about dept, or the cost of ownership. Data becomes a liability due to the cost of managing it and the potential risk the data represents. Data risk is an increasingly important issue for both individuals and organizations as the volume, diversity, and usage of data increases. The more data that an individual allows to be generated about them, the higher the likelihood that it will be used to against them. Likewise, the more data an organization collects, the more diligent they need to be in how they are managing the risk to themselves and the individuals to whom the data may pertain. 

An example 

I have a device in my house that is connected to the internet and an online service. This device manages some aspect of my house; it is not important what it manages. The important part is that this device tracks when I am home and uses the information to improve how it manages my house. The data related to me coming and going are uploaded to the online service. The online service has thousands of customers like me and provides guarantees in their privacy policy that they are taking steps to protect my information.  The issue is that no matter how diligent a company is in protecting my data, they can not guarantee that my data will be safe. Many companies are struggling to even comprehend the complexities of managing the data they collect and these complexities are evolving very quickly. All it takes is one disgruntled employee to download some basic personal information along with some additional details to allow fraudsters the ability to create a convincing scam. 

What do we do? 

As individuals and organizations, we need to be smart. We need to increase our awareness of what risks are hidden in the data and how best to reduce the probability and potential impact of the risk. There are two options; either we accept the risk and move on, or we take steps to manage it.  Organizations that understand this fact are building data governance capabilities to ensure they have people responsible for building awareness and that risks are appropriately managed. Achieving the right balance of rigor and agility is not as difficult as most organization think. The first step is to assign responsibility and make it a priority. Like many things in life, data management results take effort; so the key is understanding where to apply the effort to get the biggest value. Engage the right people to ensure you get the best results. Set them up for success by providing training and support to ease them into data governance and build maturity. Need Help with your data governance program? Send us a  message and we would be happy to schedule a consultation.