Data is like oil: Useless until you refine it
Organizations of all sizes overestimate the value of their data given the state it’s in. In other words, there is a lot of potential value in their data assets but realizing that value requires setting some strategic priorities. One of the most overwritten sentences in tech circles these days is that data is the new oil. A number of times the potential value of data has been estimated to exceed that of oil. While many organizations actively capture and store data not many can find a good use for it.
What does it mean to refine your data assets?
One way to look at data refinement is three broad activities which include:
- Inventory: In order to understand what is possible, it’s vital to account for all the data assets in the organization. This helps determine which strategic initiatives are more achievable first given the state of the data.
- Categorization: Beyond understanding which data assets are structured and unstructured it’s important to determine the quality in terms of completeness. Often Analytics projects grind to a halt when there is no data quality. This categorization also helps enterprises determine where to invest to close the gaps.
- Aggregation: One of the more valuable activities to unlock value from your data is to understand which datasets can be combined to add more value. This includes collaboration across your company and even outside such as the example of a data co-op.
- Integration: Integration has two aspects. One is the need to change the organization’s perspective on data and establish the processes or use technology that helps produce quality data as it’s generated. This integration is also vital to incorporate into existing business practices to make better data-driven decisions.
What about privacy and security?
I didn’t make explicit mention of security as one of the activities below because it’s perhaps the most critical. In order for organizations to continue to collect data from customers and partners, they need to gain their trust by giving strong assurances that it’s being well kept. In fact, each of the activities above also indirectly helps achieve better data privacy and security. By knowing what is available, what the quality of the data is, and being able to trace the states of the data throughout the analytics pipeline, the process of securing it can be simplified.
Data translates into fuel for your company’s growth but just like you cannot pump crude oil into your car, refining data is key to speed into the future of analytics.