Paul Sonderegger, Big Data Strategist at Oracle, offered insights into data capital for today’s enterprises during his presentation at the 2018 Leadership in Big Data & Analytics Forum in Chicago on December 4. In his presentation, “Data Capital In The Enterprise: The Hidden Data Economy,” Sonderegger explained data capital and the hidden economies associated with it that are located inside of global enterprises.
Enterprises frequently strive to take a data-driven approach to their everyday operations. However, few enterprises realize the scarcity of available data, along with the immediate and long-term value of this information.
With data, an enterprise can learn about its industry and target audience and find ways to achieve its goals. But data alone won’t necessarily help an enterprise accomplish its desired results. Instead, an enterprise can view data as a form of capital to boost the likelihood that it can maximize the value of all available information.
Data capital is a concept that requires enterprises to look beyond the traditional definition of data. In fact, enterprises that consider data as a form of capital may be better equipped than others to get the most out of data.
According to Sonderegger, data capital involves building up a collection of information and continuing to invest in it. As such, an enterprise that considers data as a form of capital recognizes that there is only a finite amount of information available to obtain at any given time.
“With data capital, data fulfills the literal textbook definition of capital,” Sonderegger pointed out. “Data is not a natural resource, and you have to invest in order to capture it.”
Furthermore, competition for data is ongoing among global enterprises. And if an enterprise fails to prioritize data collection and analysis, it risks missing out on data that otherwise could deliver key industry or consumer insights.
“Data is an input into some other good or service,” Sonderegger noted. “You are in competition for data … because data is not abundant.”
Although there is only a limited amount of data available globally, enterprises that understand how to obtain and analyze this information are well-equipped to thrive. These enterprises can use data to retrieve distinct observations, and as a result, uncover ways to differentiate their respective organizations from the competition.
“Data consists of thousands of unique observations, and because each one of those observations is unique, data, in fact, is scarce,” Sonderegger said.
In order to optimize the value of data, enterprises must leverage this information and share it throughout their respective organizations. Because if data remains solely in the hands of an IT team, an enterprise is unlikely to gain the insights it needs to bolster its productivity and efficiency across all departments.
“IT essentially runs a command [data] economy,” Sonderegger pointed out.
Having processes and systems in place to capture and analyze data is paramount. Thanks to these processes and systems, an enterprise can develop a collection of data that may provide substantial value to the organization both now and in the future.
“You need to think about how to digitize key business processes in order to capture data, especially activities associated with your customers and partners,” Sonderegger stated. “You’re in a race to digitize and datify activities … in order to build up unique stocks of data capital.”
Additionally, enterprises should consider how they can utilize data to enhance customer value.
If an enterprise leverages data to search for ways to support its customers, it could find unique solutions to everyday customer issues. As a result, this enterprise can take a data-driven approach to provide its customers with the products, services and assistance they deserve – something that could help the enterprise stand out to consumers around the globe.
“When you look through the lens of data capital, what you see is that data is not a record,” Sonderegger indicated. “What you see is that it is a necessary input that allow you … to deliver new kinds of value to your customers.”
As enterprises evaluate ways to optimize the data at their disposal, viewing data as capital may have long-lasting ramifications.
If an enterprise views data as capital, it can retrieve information day after day and explore innovative ways to use insights to drive meaningful results. Perhaps most important, this enterprise can establish a consistent flow of insights that spreads throughout all departments and allows the organization to accelerate sales and revenue growth.
“Data capital gives us a new way to look at data usage within a firm,” Sonderegger said. “The data economy within most large firms is hidden … but inside of every company, there is a flow of data and demand for it.”