Data Governance: Why You Can’t Afford to Hesitate

Achieving Properly Governed Data Far Outweighs the Reasons One Defers a Program

Nam TranFebruary 13, 2018

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We live in a data-driven world.  Every business, regardless of industry, relies on data for day-to-day operations.  Data creates the levers that organizations pull to optimize the customer experience, to cement customer loyalty, to enable digital initiatives, to make informed business decisions, and ultimately to increase profits.  For these data levers to have impact, it’s critical to understand the sources of your data, how the data has been transcribed or transformed, who has access to that data, and much, much more.  Data-driven strategies and decisions require trust in your data quality, accuracy, completeness, and relevance.  This trust stems from properly governed data.

In my previous blog, we discussed when organizations should initiate a data governance program.  In this post we’ll touch on why organizations cannot afford to postpone implementing a data governance program.  Given the criticality of properly governed data, it may seem hard to understand why any organization would postpone in the first place.

Why Organizations Hesitate to Achieve Properly Governed Data

As with any major initiative, initial questions often focus on cost and time to value.  It might seem like an enormous task to work with stakeholders across an entire organization to get control of the organization’s data.  However, hesitation only defers the value of properly governed data and lets the challenges grow, ultimately costing the organization more time and money.

Budget:  The biggest reason many organizations are hesitant to implement a data governance program is one simple acronym – ROI (Return on Investment). It comes as no surprise when executive management asks “How much will this cost?”, “How long will this take?”, and “How many people do you need?” What is surprising is how many data governance business cases don’t include ROI.  ROI can be difficult to measure, but the lack of this critical piece of information can side track budget approval as other projects with more discrete benefits take priority.

Resources:  As mentioned above, implementing a data governance program requires collaboration by multiple teams across the entire organization.  Having “governed data” means agreement on common definitions of business terms, development of a data glossary, establishment of data lineage, and much more.  Subject matter experts from a variety of business domains must work together, often in addition to their primary duties.  Getting time from these experts can be a daunting task, let alone getting agreement on business term definitions!  Fear not.  If necessary, data governance can take a grass-roots approach and start small.  The vision can be grand, but the implementation of the program can be done in small, prioritized steps.

Securing budget and resources can be challenging in any organization.  Lack of either can cause a data governance initiative to slide down the priority list.  Don’t shy away from the grand vision.  Start small and prove out the value, but most importantly, start!

Why Organizations Can’t Afford to Defer the Data Governance Program

When organizations start collecting data, it may be on a small scale that is manageable.  As decisions are made based on data analysis, organizations begin to see the real value in data collection and, as you guessed it, start collecting even more data.  As the quantity of data grows, organizations often lose control of how the data is defined, stored, transformed, and consumed.  Deferring implementation of a data governance program allows the challenges to grow even larger and make an implementation more difficult.

Data governance itself is an accepted idea.  However, many organizations are still testing the waters and have not taken the plunge.  Deferring a data governance program has three potential consequences:

  1. Loss of Competitive Edge: Trustworthy data is derived from an overarching data governance program. Without properly governed data, organizations unknowingly make business decisions based on stale, inaccurate, or flat out wrong data.  To stay competitive, organizations need to be data proactive, not data reactive.  Data proactivity is about anticipating data needs and staying ahead of those needs. Data reactivity is taking action in response to an event.  Without governance, organizations spend time and energy reacting to emergency data issues rather than focusing resources on proactive measures to do more with trusted data.
  1. Overwhelmed by Data: It’s an undisputed fact that data grows tremendously every day.  Opportunities to leverage new data sources and requirements to capture/report/forget data surface on a regular basis.  The complexity of this data landscape continues to increase.  Without proper data governance, without proper prioritization and control of data, this complexity becomes a convoluted mess.  Data consumers don’t know what data means, where it resides, who owns it, or how to properly consume that data.  The longer organizations delay, the more time and effort will be spent cleaning up the chaos.  Put simply, the longer an organization defers, the harder it is to start. 
  1. Increased Risk for Data Errors: Data quality is a critical component of data governance that helps build trust in an organization’s data landscape and decisions. Data governance helps verify the accuracy and completeness of data.  When users modify data sets for their own needs or create their own “single source of truth,” data becomes inconsistent across the enterprise.  Proper governance can dictate the authorized sources for data sets and help guide users to pull information appropriately.  In industries where data errors can lead to regulatory fines or customer dissatisfaction, those mistakes can cripple an organization.

Eventually the need for data transparency and control will emerge within an organization.  Data governance can help deliver that transparency and control that is crucial to achieve properly governed data.  The data free-for-all, while expedient at the time, has long-term detrimental impacts on an organization’s ability to make informed decisions and provide trustworthy information to interested parties.  The earlier an organization commits to a data governance program, the sooner they realize the benefits.  Once data is governed, everyone sings from the same songbook and the harmonious outcome can be enjoyed for years to come.

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