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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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9/10/2020 Data Governance in Digital Transformation - Strategic Finance

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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

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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 [email protected].

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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