As businesses worldwide continue to embrace new technologies to improve their end-to-end operations and outcomes, many will find they have access to greater volumes of data than ever before.
Today’s top-performing businesses typically look to collect and analyse as much data as possible to facilitate informed decision-making. If businesses can gather better insights on the needs of their customers, they can streamline operations accordingly and provide greater value.
The problem, however, is that collecting, analysing, and safeguarding enormous volumes of data requires a formalised approach to safeguard customer privacy and minimise the impact of potential data breaches. For most organisations, an up-to-date data governance framework is the first step in this process.
In this article, we take a closer look at why having a data governance framework is essential to protecting and improving the operating efficiency of your business.
What is data?
First, let’s get back to basics. Data, in its simplest form, can be described as facts or figures that are stored by a computer. In a business context, data assets can encompass valuable company information such as sales figures, customer contact details, web traffic reports, social media analytics, and much more.
Today’s most successful organisations actively use data assets to inform and support the execution of their end-to-end business strategies, from research and development to product ideation and manufacturing, to marketing and sales, logistics, customer service and everything in between.
When correctly captured, organised and analysed, data can help businesses to predict trends, identify opportunities, solve problems, and gain a range of competitive advantages. It’s not an overstatement to say that leveraging valuable data is now critical for businesses to grow and succeed.
So what is data governance?
In an environment where businesses are generating, storing and relying upon more data than ever before, it becomes extremely important to have a framework for overseeing this volume of information. Data governance can therefore be described as the practices, processes, and policies that formally outline the ways a given organisation will manage its data assets.
Data governance is also closely related to the concept of data stewardship, which can be described as the accountability of nominated business resources to ensuring the quality and completeness of information and data. The outcome is the availability and streamlined access to high quality data insights in a controlled manner.
Why does data governance matter?
The fact is that without a documented and systematic framework, organisations are more liable to treat data haphazardly. Unfortunately, these organisations are also more likely to encounter data breaches, whether malicious or accidental. A data loss occurs when privileged information is accessed, copied, transmitted or outrightly stolen by an unauthorised party.
Malicious data breaches have been on the rise in recent years as cybercriminals attempt to steal or encrypt and hold for ransom valuable company data from a wide range of industries. Data breaches can have serious short and long-term impacts on businesses – as we discussed in our recent article on cybersecurity.
In light of the above, consumers have also become more sensitive about the use of their data. Consumers are not only concerned about their data being collected – they are also worried about their information being compromised, shared, or sold to other parties. This mistrust can lead customers to be cautious of the organisations they deal with, and there are plenty of real-world examples of this relationship being damaged when their data is not handled appropriately.
In fact, individuals’ privacy is protected by the Australian Privacy Act and the Australian Privacy Principles, and Organisations must be aware of their obligations to protect personal information. It’s also worth noting that laws such as Europe’s General Data Protection Regulation (GDPR) or USA’s California Consumer Privacy Act (CCPA) have been developed to regulate how organisations collect, manage and use data, and there are cases where these laws may apply to businesses operating in Australia in addition to the Australian Privacy Act and Principles.
As you can see, data governance has a fundamental role to play in safeguarding and future-proofing your business operations. In many ways, a data governance framework can be thought of as an insurance policy that helps you to identify and manage risks before they materialise.
How to draft a data governance framework
1. Develop a mission statement
To get started, we recommend preparing a statement that describes how a data governance framework will support your business. For example, have you experienced a data leak and want to reduce the likelihood of this happening again? Are alarm bells ringing within your organisation because a competitor has been targeted by cybercriminals? Or are you simply hoping to follow industry best practices? Reflecting on these questions will help ensure the framework you put together meets your organisation’s needs.
2. Make a current assessment
Next, it’s worthwhile considering your current approach to data. Are there any existing policies or procedures in place? What works? What doesn’t? Who is involved in existing data processes or workflows? Answering these questions can help you to successfully determine which individuals or departments should have responsibilities for data – known as data owners and stewards.
3. Assemble an interdisciplinary team
Gathering an interdisciplinary team of professionals is a good way to ensure your data governance framework is well-rounded. We recommend bringing together experts from all areas of your business, including IT professionals, legal advisors, business team leaders and product owners. Including interdepartmental perspectives will ensure your governance framework reflects how each area of the business deals with data day-to-day.
4. Look to the future
It’s also vital to anticipate the ways that data might be produced or used within your organisation in the future. For example, are there any major IT projects or upgrades on the horizon that should be considered? Are new laws or regulations going to impact the way your business deals with data? Having a future state in mind will help your data governance framework stay relevant for longer.
5. Choose a formal framework
There are plenty of resources available to help document and formalise your data governance framework. Whichever framework you choose should provide a comprehensive view of your organisation’s data landscape (we suggest a visual depiction of this, such as a data lineage graph).
A successful framework should further articulate the accountabilities and responsibilities that data owners, stewards and consumers have within your business; should highlight critical processes and policies; and should include any Key Performance Indicators that may be needed to measure overall effectiveness.
In short, data governance is not a destination, but rather a journey. Your business’s data governance framework will need to be revisited and refined over time to meet changing internal and external conditions. The good news is that Business Aspect can help you with each step outlined above to help to keep your data governance framework fit for purpose.
Parting thoughts
Data is one of the most valuable business assets today, so it makes sense to manage it accordingly. Greater data governance can help businesses to improve data quality, to make fully informed data-driven decisions, enhance performance, and support greater productivity and profitability.
If you’re looking to make data work harder for your organisation, contact the experts at Business Aspect today. We can help you to take charge of your data assets and to prepare for the future.