6 Reasons You Need Data Governance

We can use data cleansing tools to get the project done, but the bad data makes it more costly. So, we encourage our partners to institute data governance to help them stop creating bad data. When Do You Need Data Governance?

The short answer to whether you need data governance is always. People in your organization need to know and apply the rules to data creation, storage, transmission, and preparation. Bad data can have a huge impact on your business.

Formal data Ggovernance is required when:

• The size of the organization or the complexity of technology outgrows the ability to manage it.
• You need to break down data silos and organizational barriers.
• When privacy, compliance, or security requirements require Data Governance. 

Do You Have Any of These Symptoms?

As data becomes more democratized, the need for governance grows. Enforcing standards was easy when IT owned the data and created the reports. Today, almost everyone in an organization creates and uses data. Without governing principles, data becomes chaos.

Here are the symptoms we have seen in our work.

• You can’t trust your data.
• Poor decisions because you don’t have relevant data.
• Missing opportunities because getting the information you need takes too long.
• Your competitors are beating you because you can’t react fast enough.
• Analysts spend more time preparing and cleaning data than using it.
• Data costs more than it should because you spend so much on correcting. Read our article on the cost of bad data to learn more.

Data Governance Isn’t Data Management

Michelle Goetz at Forrester calls our attention to the conflation of terms between governance and management. She points out that by trying to make it simple, marketers have made it worse.

The trouble starts with the concepts themselves. Here are the definitions from TechTarget:

• “Data management is the process of ingesting, storing, organizing and maintaining the data created and collected by an organization.”
• “Data governance is the process of managing the availability, usability, integrity, and security of the data in enterprise systems, based on internal data standards and policies that control data usage.”

We can understand why the two terms can become conflated. It’s hard to see where one ends and the other begins. Good data management requires data governance, but you could exercise data governance if you were still using the processes of the 17th century.

A Simple Analogy

We can think of it in terms of my cooking hobby:

• Cooking management is the layout and equipment in the kitchen, including the appliances, gadgets, storage, and fuel supply. It includes instructions for the proper use of the tools.
• Cooking governance is the recipes, safety rules, and procedures we follow in using the tools to create food from ingredients.

Here’s another example: ISO 3166 defines two sets of country codes. One set (alpha-2) is two letters, and the other (alpha-3) is three. Data management is making sure that your apps can use the same codes. Governance is deciding which one you will use and ensuring everyone knows what they are and how to use them.

Getting Started

We recommend starting by connecting the Data Governance Institute or your software vendor to learn what it can mean for you. Affordable membership can help put you in the know on how to build your governance framework. Training is free for members.

Conclusion

Data Governance and Management are critical today. With Privacy, Compliance, and Security requirements, anything else is a recipe for disaster.

To avoid those pitfalls, your organization needs to understand the rules governing data creation, storage, transmission, and preparation.

If you don't invest in Data Governance, you may experience any of the symptoms we’ve listed, the most critical being bad data’s impact on business decisions.

We encourage you to read our article on the cost of bad data.

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