At first glance, it might seem that procurement is an unlikely partner for data governance. Many data governance staff members will likely have less-than-fond memories of past experiences involving procurement. Yet, there are good reasons for data governance professionals to proactively build a partnership with procurement. These chiefly revolve around working with data vendors – something that is becoming ever more common in many enterprises.

Data Purchases

Perhaps the major driver for data governance to work with procurement is to rationalize data purchases.  Today data is increasingly purchased from outside the enterprise for all kinds of reasons. Ultimately, procurement have to execute the contracts with the data vendors. It is natural that procurement will want to rationalize such purchases, to make sure that what is essentially the same data is not being purchased over and over again. Since procurement does not have subject matter expertise about data they need a partner who can help them analyze data purchase requests. That partner should be data governance.

Ideally, data purchases will involve data governance long before procurement gets involved. Unfortunately, very few enterprises are at that level of maturity, but it makes it all the more important that data governance work with procurement on the purchase requests they receive. Trying to rationalize data purchases can be easy if one department is simply requesting the same data as another department has already bought. It is less easy if a request is for a type of data that is supplied by Vendor A when this type of data is already being purchased from Vendor B. Here, data analysis is required. Is there some key business difference between what is supplied by Vendor A and Vendor B, or are they essentially the same? This is difficult but the analysis has to be done.

Contract Management

Procurement usually has a good reputation for getting the best deal possible. However, with data there are more considerations than money. Lack of expertise about what to look for in data contracts can lead to situations where very unfavorable clauses are agreed to by enterprises. For instance, there may be restrictions on the number of records provided by a data vendor that can be published, or the vendor may prohibit their data from being used for derivations. 

If data governance works with procurement, unfavorable and even worse “atypical” clauses in contracts can be identified. Procurement can then negotiate to get these changed or eliminated.

Data Vendor and Contract Metadata

While procurement will very likely have some kind of environment for tracking suppliers, data purchases are different in nature to other purchases and there is justification for tracking them separately.

For instance, as we just noted, once a large number of data purchases have been made it becomes ever more difficult to compare the next purchase request with all the other purchases to see if the new purchase is justified. One way to make this easier is to use a taxonomy of enterprise data such as a Subject Area Model to classify the data in every purchase. This can be done in a repository, which can be examined when a new data purchase request is submitted to determine if the kind of data requested has already been purchased.

A list of data vendors is also useful. Dealing with too many data vendors can be an overhead, and getting down to a number that is easy to deal with can be very helpful. The repository can show which vendors are supplying which data, and can help in this rationalization.

Another area of data contract metadata management is keeping track of the restrictions that are placed on data usage by the vendors. More mature procurement units can be helpful by documenting these restrictions, which are nearly always at the data element level. For this to happen, data elements must have standard names and there should be a data dictionary with definitions that procurement can use to confirm they have identified data elements correctly.  here must also be metadata elements to allow the restrictions to be described. In less mature organizations, data governance may have to get involved to help procurement with these tasks.

Data Vendor Relations

On more way in which the two teams can work together is in formulating a strategy to deal with data vendors.  The enterprise should consider what it wants to get out of its data vendors, e.g. acceptable levels of data quality, service, timeliness of data delivery, and so on. Again, data governance can supply a data requirements perspective, and procurement can add in its expertise in negotiation. It is also important to have a united front that is presented to data vendors. Vendors are adept at “divide and conquer” strategies that play business users off against each department.

A more positive aspect of dealing with data vendors is that many of them genuinely want to help with data management in their customers’ environments, but customers rarely organize themselves to take advantage of this. Monthly or quarterly meetings with data vendors that involve data governance and procurement can help to facilitate useful inputs from data vendors.

Contract Compliance

Contracts with data vendors always include some clauses for the protection of vendor data. Very often this gives vendors the right to come into the enterprise and audit the use of their data – sometimes without notice.  This is not something that any enterprise wants, and it is a good practice for data governance to ensure that all usage of vendor data is compliant. This can be done with policies and procedures, but ultimately involves some form of data profiling. 

If data governance finds that usage is trending in ways that will eventually result in out-of-compliance conditions, then it can alert [rocurement so that the relevant contacts can be renegotiated to allow for broader usage of the vendor data in the enterprise.

If actual out-of-compliance situations are found, then procurement, will have to be informed. Perhaps immediate remediation will fix the problem, or perhaps the relevant contract can be interpreted in a way more favorable to the enterprise that covers the actual usage.

As data governance matures it is going to form special partnerships with different units of the enterprise to address specific challenges of data management. Working with Procurement is just one more of these partnerships.

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