Why Data Governance?

Enterprise assets must be managed, and as I’ve discussed, this includes data. We don’t think twice about spending a considerable amount of money and resources managing every category of asset. Each asset type has an organization dedicated to managing the asset. Each type of asset has a body of knowledge devoted to management of the asset, and often its own academic field of study. University degrees are given in accounting, marketing, IP law, and real estate, each of which is focused on managing a particular class of asset. As shown below, each class of asset also has an executive accountable for acquiring, protecting, maintaining, utilizing, and disposing of the asset. The executive is responsible for assembling a team of people with the right skills and for putting in place business processes to protect and leverage the value of the asset.

If data is also an asset, it also requires an executive to be held accountable for protecting the asset, and for ensuring that its value to the organization is maximized. Leveraging the value of data while ensuring it is protected requires a dedicated staff with a very specialized set of skills and expertise. It requires a set of business processes with clear roles and responsibilities. In short, it requires the same level of attention and focus that every other asset receives.

This is the justification for allocating the resources necessary to develop a Data Governance organization and capability under the leadership of a Chief Data Officer. Data Governance is somewhat immature, and to many CEOs the need for Data Governance is not clear. But if data is an asset, and it is, then a Data Governance organization with an accountable executive is as much a necessity as an Accounting department.

But why a CDO? Isn’t Data Governance the CIO’s responsibility? In my posts so far, I have deliberately avoided the discussion of software, which after all is a capitalized asset. In my next post I will discuss the overlap, and the differences, between IT and Data Governance.