Why businesses need to invest in data infrastructure, by Louise Burke, Managing Director, the Open Data Institute
It is easy for us to see how data is almost everything to a company like Meta, Twitter or Amazon, and we all saw how ‘the data’ dictated the government’s response during the pandemic. Yet it can be hard for many smaller or more traditional companies to appreciate its value, not least as data doesn’t appear on the balance sheet in the same way that a piece of machinery or a property might.
This sense of data being something important-yet-intangible can lead to an unwillingness to invest – when it’s not clear how an investment in data infrastructure can be returned both in financial and reputational terms. It’s a bit like recognising the value of the invention of the train and then failing to build any tracks.
Hiring right and skilling up
For me, this problem with recognition of value can often be reflected in staffing policy. Most businesses acknowledge the need for staff responsible for tech and some of the compliance issues that surround the use of data, yet those roles are often wrapped up in other functions, or are recruited at too junior a level.
This is a risk for businesses, as ethical, secure and, above all, serious care for and use of data has the potential to allow businesses to forge a competitive edge. If businesses fail to realise the value and importance of the data they hold then they really do risk wasting an opportunity, as well as risking their reputation. It only takes one serious data breach to damage brand image with shareholders and customers alike.
This is just one of the reasons that I believe recruitment for the role of chief data officer (CDO), especially in larger companies, should be treated every bit as seriously as the C-suite roles occupied by HR, finance or marketing. After all, the staff member in that role has the potential to generate (or cost) the business every bit as much as any other senior staff member in the executive leadership team.
They can keep abreast of legislation, ensure that security is maintained and assist just about any other part of the business, from rationalising accounting to making strategic business decisions or providing evidence for media stories. The next decade may see data regulated and audited in the same way that company finances are today, with individuals accredited for their professional expertise and companies certified for data stewardship, in the same way that financial statements are audited. Only those who plan ahead can avoid the kind of missteps we saw ahead of the implementation of GDPR legislation.
Data ethics – which concerns how data is gathered, stored, used and shared – is also becoming an important issue for those who work with data in their business. It is set to become as significant a consideration as diversity, equality and inclusion in HR practice. The more we understand trust in data and data ethics the more it will inform our decisions about anything from who we work for to where we shop. Moreover, some recent research by Frontier Economics for the ODI showed that increasing trust in data has the potential to raise GDP in the UK by 2.5%.
Data literacy plays a part in this, but as we become a more data-aware society the expectation around these issues will become raised. This knowledge will also allow people to be inquisitive about what your business is doing with data about them and what your company’s data says about you. And this is where being proactive about data and what it reveals comes into its own. After all, it is one thing to publish information about gender pay gaps in your organisation and quite another to show how you have made improvements in business practice to close those gaps the following year.
Data can allow you (perhaps with the help of communications professionals) to weave great narratives around your ethical and business practices, but it also leaves you as a hostage to fortune should you fail to follow through on promises made or truths revealed. Social media thrives on data and you can be sure that there will be someone out there more than willing to point out any errors or omissions on your part.
Looking back over ten years of data, as we are doing at the ODI with our Data Decade campaign, also prompts thoughts about the future and how the next ten years will look. I think that one of the big opportunities – which may also offer PR opportunities – will be in showing how data can actually solve the big future challenges to address our climate crisis, as well as how it could help people with well being and health issues. In our work with Allegory over the last ten years we have learnt a lot about how illustrating the potential of data to improve society is a great means of getting our voice across to new audiences.
I see a lot happening around how data, data practices and organisations who generate, use or handle data are assured (that is – how they inspire trust and build reputations for being trustworthy). For this to happen, we need effective mechanisms that allow data to flow in the right way and to be shared safely.
I think we will also see organisations within sectors getting together to realise the power of data for the greater good. So, you may have businesses combining their health and safety data in the construction sector, for example, in order to highlight common risks or eliminate accidents. It’s a non-competitive use of data, which has benefits across industry and society.
Government has a part to play too, of course, and they may well shape some of the changes around how we use and share data – in the UK, the National Data Strategy is a useful starting point that we should see generating positive effects over the next couple of years. In the meantime, the ODI will continue to progress its mission to work with organisations to build an open and trustworthy data ecosystem, believing as we do that data is for everyone!
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