In an information-driven society and increasingly digitalised world sentiments are shifting from the economics of tangible assets to the economics of information, analysis reveals.
According to a new Gartner study, ‘Infonomics’ is the theory, study and discipline of asserting economic significance to information.
It strives to apply both economic and asset management principles and practices to the valuation, handling and deployment of data assets.
Douglas Laney, Gartner’s vice president, explains in his analysis ‘Infonomics, How to Monetize, Manage and Measure Information as an Asset for Competitive Advantage’, how chief data officers (CDOs) and other data and analytics leaders can help their organisations become more info savvy.
Laney explained: “Traditionally, information managers have had a limited view of how they can help business leaders generate value from information, mainly focusing on operational and analytical benefits.
“Businesses that measure information’s productive utility can make more intelligent investments in information-related initiatives, among other benefits. Infonomics provides the framework business needs to value information, manage it and measure it as a real asset.”
The study outlines that ‘Monetise’ is trend to recognise and take advantage of data’s unique economic characteristics is still in the early adoption phase, and is therefore a competitive differentiator.
Laney points out that organisations broadly monetising their data assets by using them to reinvent, digitalise or eliminate existing business processes, products and services can readily outstrip their rivals.
Yet many data and business leaders lack the experience and methods to monetise data in a wide variety of ways, thereby leaving much of it underutilised.
The second pillar ‘Manage’, underlines that to date, no widely accepted set of principles and practices exists for managing data as an actual asset.
Yet, domains outside of enterprise data management and even outside of IT have long benefited from sets of detailed, well-honed asset management methods and standards.
Rather than creating data asset management procedures from scratch, data and analytics leaders, including CDOs, should adopt and adapt practicable concepts from these other domains for improved data asset governance, availability and utility.
The third pillar, ‘Measure’ refers to the fact that most organisations lack any reliable way to determine the potential and realised value of their data assets — merely because data is not a recognised balance sheet asset.
Even so, CIOs, CDOs and even CFOs should adopt data asset valuation methods to justify and prove data-related investments, spur information-based innovation, and foster an data-driven culture.
Valuation approaches can include gauging information’s quality characteristics, business relevancy and impact on business functions, along with its cost, market value or impact on expense savings or revenue streams.
“CIOs, CDOs and business executives need to ask themselves how their organisation expects to survive, let alone thrive, in the Information Age without treating data as an actual asset,” said Mr Laney.