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9/10/2020 Data Governance in Digital Transformation - Strategic Finance
https://sfmagazine.com/post-entry/september-2020-data-governance-in-digital-transformation/ 1/6
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DATA G OV E R NA N C E I N D I G I TA L T R A N S F O R M AT I O N BY ROD KOCH, CMA, CSCA, PMP, CSM, AND TATYANA CORBAN, CPA
September 1, 2020
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Data policies, corporate culture, organization structure, technology infrastructure, and workforce development are the
foundations of data governance.
What does digital transformation mean to you? For many, it means the rapid
creation of personalized customer experiences. But digital transformation is also
driving a surge in data, requiring careful management and control with
heightened attention to the security and privacy of the customer information
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that enables it. The recent Harvard Business Review (HBR) research “A Blueprint
for Data Governance in the Age of Business Transformation” (bit.ly/346v5uw)
shows that corporate executives, senior and middle managers, and other cross-
functional stakeholders understand these constraints and view investments in
data governance as a way to enable data-driven decision making, enhance their
organization’s reputation, improve competitiveness by protecting intellectual
property (IP), and reduce the costs and fines associated with data breaches.
Creating trust by applying robust data governance also helps organizations retain
and attract customers while increasing revenues. How can organizations meet
the expectations of rolling out digital transformation and responding quickly to
customer needs while protecting corporate IP and customer information?
According to the HBR research, creating effective data governance rests on five
pillars: (1) data policies, (2) corporate culture, (3) organization structure, (4)
technology infrastructure, and (5) workforce development.
DATA POLICIES
Before creating data policy, the first step is to define what data governance is
appropriate for your organization. Data governance is a data management system
that ensures that business objectives are supported by high-quality data and
controls across the complete life cycle of data. It supports data availability,
usability, consistency, integrity, and security by establishing accountability for
data quality and promoting accessibility and proper use of data across the
organization.
Experts agree that effective data governance is one of the first principles of
proper data management. Data governance identifies what data will be collected,
how it will be collected and protected, and how data compliance and
confidentiality requirements will be achieved. Creating effective data policies
9/10/2020 Data Governance in Digital Transformation - Strategic Finance
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and systematically communicating them throughout the organization will ensure
that all employees are consistently aware and follow proper data security and
management protocols.
The next step is to define all valuable or potentially valuable organizational data,
including all customer data, and to perform a data policy gap analysis. The
analysis should include all business units and consider both internal policies and
external regulations. A risk-assessment heat map should be created to identify
and close the gaps.
Now create or update the policies based on the results of the findings, giving top
priority to areas with the highest ROI and potential impact. Finally, set up an
ongoing review process to continue updating the policies as needed, based on
business, legal, and regulatory compliance as well as changes in the economic
environment.
CORPORATE CULTURE
Corporate culture often requires significant changes for an organization to
become a data-driven enterprise. Why is creating a data-driven culture so
important? Gartner advises, “Culture and data literacy are the top two
roadblocks for data and analytics leaders” (gtnr.it/3kSGIv3). Overcoming these
roadblocks by creating a data-driven culture allows organizations to better serve
their customers and accelerate decision making.
Tableau advises that data-driven cultures require five common elements: trust,
commitment, talent, sharing, and mind-set. “Becoming truly data-driven
requires changing mindsets, attitudes, and habits—embedding data into the
identity of the organization. People have to want to use data and encourage
others to do the same. In a Data Culture, people ask the hard questions and
challenge ideas. They come together with a shared mission to improve the
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organization and themselves with data. Leaders inspire through action, basing
decisions on data, not intuition” (tabsoft.co/3iRLs2q). For organizations to
successfully adopt these new cultural norms, leadership must choose and
systematically apply a change management methodology, including a strong
communication plan.
ORGANIZATION STRUCTURE
To bring sustainable change in establishing data-driven culture, the most
successful organizations have added the role of chief data officer (CDO).
NewVantage Partners’ Annual Big Data Executive Survey 2018 found that 62.5%
of senior Fortune 1000 business and technology decision makers said their
organization had appointed a CDO. The CDO’s primary purpose is to provide
leadership in treating data as an organizational asset, with robust and
comprehensive data governance. CDOs work with IT and business-unit leaders
to identify and communicate the business value of the data and then lead all
aspects of data strategy around data management, including governance.
Another prominent C-suite role with the specific focus on driving information
security initiatives and programs pertaining to internal and external threads is
that of chief information security officer (CISO). More than half of regulated
industry organizations surveyed by HBR agreed about the essential role of the
CISO.
Having a CDO and CISO isn’t enough. Good data governance requires cross-
functional cooperation and leadership. Senior executives must understand the
importance and ROI of data as an asset and become its stewards and enthusiastic
supporters of data governance. CFOs can be instrumental in leading the charge,
due to their broad understanding of financial and organizational data. All
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business-unit leaders should align with the data governance strategy and follow
the correct policies and procedures. Good data governance will increase
customer trust and reduce the risk of its loss.
TECHNOLOGY INFRASTRUCTURE
Investing in security infrastructure and data governance monitoring improves
governance maturity. Leading organizations pursue anti-malware, data-flow
tracking, e-discovery, and behavior-monitoring investments.
Understanding what data exists, which data is confidential, and how the data is
being used can be simplified using the correct technology tools. And applying
regular updates to infrastructure reduces the risk of breaches providing customer
reassurance, which is critical in maintaining both B2B and B2C customer
relationships.
WORKFORCE DEVELOPMENT
The weakest security link in most organizations is their workforce. Most
malware breaches occur because of employee mistakes. Organizations need
“soft” training (e.g., how to recognize phishing attacks, comply with
security/privacy policies, etc.) as well as training in any new tools.
Effective data governance rests on the five key pillars of data policies, corporate
culture, organization structure, technology infrastructure, and workforce
development. Although data governance is often behind digital transformation,
by focusing on these pillars, data governance can catch up and support digital
transformation innovations while protecting corporate IP and customer
information.
9/10/2020 Data Governance in Digital Transformation - Strategic Finance
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All views, thoughts, and opinions expressed belong solely to the authors, and not
to the authors’ employers.
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Rod Koch, CMA, CSCA, PMP, CSM, is a member of IMA’s Technology Solutions and Practices Committee and the IMA Global Board of Directors. He can be reached at rwkoch@syr.edu.
Tatyana Corban, CPA, is a member of IMA’s Technology Solutions and Practices Committee, IMA’s Portland Chapter, and the Society for Information Management, Portland Chapter, board of directors. Follow her on LinkedIn at bit.ly/3kCBDH5.
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