This vendor-written piece has been edited by Executive Networks Media to eliminate product promotion, but readers should note it will likely favour the submitter's approach.
As organisations race to make sense of the opportunities and problems associated with our increasingly data driven world, businesses are coping with the need to more accurately measure its true value. We talk about 'data as the new currency' and we try to give it a price tag. Typically, data is worth what someone is willing to pay for it, however, that simple transactional view does not tell the whole story.
By 2024, we'll have a fully established Information Economy where data is critical to businesses looking to predictively spot new opportunities to gain a competitive edge. Standards-based information will be sold, donated and traded on open exchanges. Data marketplaces will facilitate the transfer of data in and out of siloes more fluidly and people will start to broker their own data. We're already seeing many signs of this - but it's only the beginning.
In light of the changing landscape, we all know your company's data is important - that's obvious. But just how important is it? How can you measure its value?
Savvy businesses will take note and prepare for the future by 'architecting for value' - understanding and creating business and IT valuation processes within the company that reveal the real value of data. Let's take a look at some examples of new data valuation activities being undertaken by organisations today.
Data Becomes Your New Product
A recent report on Big Data's market disruption by Capgemini and EMC found that 63 percent of respondents consider that the monetisation of data could eventually become as valuable to their organisations as their existing products and services. This speaks volumes about Big Data's potential - companies that have long sold products for revenue may start generating more revenue from data value than product value. French tennis racket manufacturer Babolat makes a 'smart racket,' the Babolat Play, which generates and collects data about a player's performance on the court. By creating a smart product, Babolat took the first step to data value. This data could become an entirely new revenue stream. Babolat might, for instance, sell this data to app developers looking to make new products and user experiences or sell the data to athletic research organisations for data mining. A tennis racket can only be sold once, but the data it produces has endless monetisation potential.
Data Valuation for the Worst Case Scenario
Large-scale cyber-breaches are becoming far too frequent, resulting in great financial loss for multiple companies. As a result, data insurance policies are becoming a necessary part of doing business. Working with the insured, data insurance companies have to place value on a data set that not only looks at the value of the data to the insured's business, but also takes into account the multitude of other factors that happen in the event of a data breach. Customer notifications, reparations and other costs such as PR for damage control all must be factored into the price of insurance. AIG's CyberEdge, ACE's Privacy and Network Security, and Lockton's Cyber & Technology division offer companies coverages in the event of a breach that factor in the nuanced effects of a data breach.
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