Technology vendors are evangelising the notion that data is so valuable it should have a place on a company’s balance sheet.
The idea is an extension of the conventional wisdom that the data can be used to generate powerful insights which will make businesses more competitive.
Gartner analyst Doug Laney literally wrote the book on the concept, which he refers to as infonomics. In his view, businesses should consider information an asset on the company balance sheet in order to exploit its unique economic characteristics.
“Infonomics is about internally recognising information as an asset, finding ways to manage it, measure it and monetise it — to generate economic benefits from it,” Laney says.
In a similar vein, Mike Palmer, EVP & Chief Product Officer of cloud data management company Veritas Technologies, argues classifying information using accounting terms will change the way organisations treat their data.
“We need to make sure all data is defined for active use – or removal – so that it sits as a positive item on the balance sheet,” Palmer told Which-50.
“We can also say that under-utilised data is essentially a negative item on the balance sheet because not only do you have to pay to store it, it also represents a risk to the business.”
Palmer identified three ways to ensure data is a marked as a positive item on the balance sheet.
1. Firstly, different types of information need to be defined.
“Knowing where your data is, how to manage it, who owns it, who has privileges to see and use it and what resources to feed it with (backup, deduplication, data quality tools and so on) is instrumental to harnessing the power of your information,” Palmer said.
2. Businesses also need to have a clear idea of what they are using their data for, and if they are getting more than one benefit from the copying that data.
“One of the obvious benefits is the ability to restore the primary copy, but secondary copies should also be used for analytics purposes,” Palmer said.
3. Data should also be made accessible to developers so that they’re able to build platforms that will optimise and improve the way we do business, Palmer said. However businesses need to strike a balance between innovation and risk.
“Companies should encourage developers to fully leverage available data sources when developing new applications, platforms and systems, to ensure that they create the most optimal build with the view of benefitting the wider business.
“At the same time, companies need to maintain control over the data without stifling innovation. It is imperative that organisations find a way to encourage that innovation, but also have an eye on the risks associated with that – finding that balance can be tricky.”
In the end it comes down to that value you can derive from the data in terms of new business opportunities, Palmer says.