Could information management have prevented the economic crisis of 2008? Let's put it another way: could the proper application of information management have helped keep certain companies from imploding, which caused the trickle-down effect on the world economy?
The answer is perhaps. Once we get past looking at information management strictly as technology, the answer more clearly becomes yes. The fallout of the financial situation has affected all industries and all companies, resulting in what is now officially a recession. Every company is challenged to dig itself out and work with whatever changes governments make to cope with the problem.
Every crisis eventually uncovers a catalyst for recovery, and it is yet to be seen whether information management will help us get out of our latest jam. The technology necessary to aid the world economy is widely available in the form of analytics and operational BI (including complex event processing, data integration and MDM). Even where creative application is necessary, the technology can scale and handle the velocity of information in the largest organizations. But at a minimum, it can certainly do much more than what it's doing today.
The challenge has been developing the data layer and the architecture, and these equally important elements have not always been available to make the technology effective. In recent years, implementations and best practice programs have evolved, but too often it was assumed that technology alone was the answer. No industry is immune to this mind-set when buying BI tools, ETL tools, MDM software and the like.
We are in a freewheeling industry when it comes to product terms, features and functions. This makes it easy for vendors of information management wares to position their products, but makes it harder for an end consumer to distinguish the work necessary to meet business requirements. Most notably, this is true about the data layer, which is so important to the architecture.
Risk management, as an emerging application area, is gaining attention as a tool for the prevention of future crises, and rightfully so. Simply put, humans are humans, and at a group level, behavior is predictable. Most people did not join the failed companies with the goal of taking extraordinary risks. But where risks are unknown due to a lack of quality information, or in an environment that steadily increases risk-taking, danger is sure to arise.
We must support risk management with a strong data layer in the architecture. With effective, available information, systems can highlight and flag events that take company actions outside the bounds of risk tolerance. It is important to prohibit the creation of products that cannot be described to the systems. Such products are likely to go off-system and outside of risk management with no provision for proper auditing.
A renewed focus on risk management should mean a renewed focus on information management; information defines the risk factors at hand. Information management is what executives are demanding when they talk about lack of access to relevant, timely and consistent data. Once quality data is available, the required transparency can be accomplished with modern application layers that include process flows and dashboards made accessible to internal users and to regulatory bodies.
We should be aware that the new wave of warning signs generated by information management could still be ignored by companies and by government regulators. It is time to make ignorance immensely more difficult for the foreseeable future.
Whether or not it becomes the prime catalyst in our next recovery, information management will play a major role. Operational BI is emerging with room to grow into an operational process flow, providing rich, accurate and automated decision-making. Business rules systems supported by quality information will become more important in managing risk. Finally, MDM can create single master lists to work from so that organizations will be well aware of their exposure to customers and business partners.
The realization is sinking in that no matter what business you are in, you are in the business of information. Modern competitive advantages will accrue from harnessing corporate data into an information infrastructure capable of supporting the volumes of data that the corporation generates alongside relevant third-party data. There may be required redundancy in information within the corporation and scenarios where information is processed without being stored. Such is the nature of the modern information management architecture.
Information management's importance in helping companies recover from the current economic crisis is unmistakable. An efficient supply chain, fast time-to-market, good customer service and low prices are tickets to entry. The differentiator is going to be use of information, which, ironically, will result in more efficient supply chains, faster time to market, better customer service and the ability to be more competitive overall. But practiced wisely, it offers broader hope for economic recovery.
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