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Stop Trying to Put a Monetary Value on Data – It’s the Wrong Path

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I recently received a client inquiry that I see flavors of a few times per quarter. The client said they are trying to explore ways to establish information value within their enterprise. Because people often frame data and information as an asset, then shouldn’t we be able to establish its value?  

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Comments (26)
I am in complete agreement with you. The value of data lies completely within the context of the business value it supports. I fell into the camp of "data is the most valuable asset" because it gave me a sense of prestige as a database designer and developer. I couldn't remain in that camp, however. It soon became clear to me that it's the business that always matters and the data matters only as much as it can support the business.

Great article!

Posted by Julius C | Thursday, March 31 2011 at 10:17AM ET
Rob, it is a nice inflammatory title and opening statement, but your think is sloppy!

Your example starts with CUSTOMER. What data supports your concept of CUSTOMER? AS you point out there is a hierarchy of data, information and knowledge. You are starting at the information level and ignoring the foundation you think you are standing on (I see you talking about your view from the fifth floor assuming that the first four floors have been planned, built, inspected,as well as, the rest of them building).

Your process approach works well if you do not have to integrate any data. That is, your sales, marketing and service either one monolithic system or in a modern well defined SOA set of services. The rest of us who have deal with required data integration start to rack up COSTS! Where is the data definitions? How is the data definitions reconciled between the system? How are the business definitions about the data reconciled between the business units? Who knows about the data and are they still around?

The operational costs are only some of the easy present day costs that are associated with data. What is the marginal cost of having 30 years of quality data on a customer?

Your process data management will fail since it does not have a data custodianship (look up the definition) component. A data custodian has an role of accountability and responsible for the data. What you need is to identify that business owner that is accountable for the data, so that can put any process or process discussion into play so you can maximize the monetary value of the information coming from that data.

Posted by Ronald w | Thursday, March 31 2011 at 12:47PM ET
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