What Is Data Governance and Stewardship?
Data governance and stewardship is an ethic or discipline that adheres to the organization’s policy of how data—such as user data or web data—is being collected, stored, and distributed to different systems of the organization and their third-party providers. It requires the organization to have full knowledge of all the technologies that are being used on every digital property that they own and operate. This is a critical component to determine if an organization is in compliance with the privacy laws that are applicable to their operations.
Why Is Data Governance Important?
In the age of privacy laws and regulations, every organization should implement ways to govern their data. Gone are the days where organizations can simply collect all the data that they want without ever considering privacy implications. In this world, privacy laws like General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA), among others, are designed to protect the privacy of the users and it’s critical for organizations to know if they are in compliance with the laws that are applicable to their operations.
What Is a Data Governance Strategy?
Data governance strategy is a policy that will be enforced within the organization to understand how data is being collected from digital properties like websites or mobile apps. It’s critical to have processes that regularly review if every technology that is deployed by the organization is in compliance with different privacy laws that are applicable to the organization. This means that the organization’s legal and privacy team are heavily involved with this conversation across the organization. Every organization should also have the capability to retrieve, analyze, and delete user data if they requested it.
Who Is Responsible for Data Quality within an Enterprise?
Every organization should have a data governance team. So what is their responsibility?
The data governance team is the dedicated resource within an organization that oversees the implementation and adherence of processes around:
- Vendor contracts review with either the procurement team, legal team, or both
- Collaboration with organization’s security team in vetting the new technology the business team is planning to use
- Reviewing and optimizing the deployment of new technologies that will be used within the organization’s digital properties such as websites or mobile apps
- Ongoing monitoring of how different data, such as user data, is being collected, stored, and distributed into various systems deployed on the organization’s technology infrastructure
- Working with multiple teams within the organization to design and implement a data extraction and data deletion solution
- Working with the database team on retrieving, analyzing, and deleting user data if the user requests it
What Kind of Impact Can Poor Data Governance Make?
An organization has the ability not to act on or adapt to the world of data policies and legislation. However, it’s important to understand that there will be implications associated with it.
Here are a few risks and implications of not having a data governance strategy:
Poor Consumer Experiences
- Lost revenue – Revenue is one of the most important KPIs for any company. If a consumer has a poor experience due to your company’s inability to take the data you have of them and present them with a wonderful experience, they will be frustrated … and frustrated consumers are much less likely to be sold, up-sold, or cross-sold. In other words, poor consumer experiences driven by poor data governance is bad financially for business.
- Frustrated members – Ever made a call or reached out to a company and they do not seem to know they should already have data on you that you expect them to have? You inevitably then spend time supplying the same data over and over. Frustrating, right? Well, frustrated customers buy less and provide less data leading to lost revenue and sub-optimal learning opportunities for all current and potential customers.
- Poor learning – If your consumers are frustrated, they will not be as engaged as they could have been. They feel you, as a brand, are not worth the time you are requiring for them. This could be in terms of reentering or providing data for the second, third, and additional times. This could be in terms of your algorithms not providing them with what they are looking for. How could this be? Lack of data to feed algorithms results in poor learnings for your company—and poor learnings can make consumers frustrated. This also leads to lost revenue. Learning is a primary goal of any data collection and not having control of your consumer data is not good business.
Lack of Consistent Data
- Not knowing what is working and what is not working – Poor data governance can lead to a lack of consistent data collection of your consumers. This in turn leads to holes or blind spots in your data. With incomplete data, how do you know what is working or not working? How do you know if something meant to drive revenue is getting the consumer’s attention as expected? How do you know if a marketing campaign is as successful as it could be? You don’t.
- Marketing dollars wasted – Lack of consistent data collection leads to wasted money on multiple fronts but a particularly painful one is wasted precious marketing dollars. Without complete data sets to say what campaigns are working or not, you are by definition wasting your money or at least not making it work as productively as it could be working for you.
- Missing consumer expectations – Consumers expect you to “remember” everything you have collected about them across all of your consumer-facing touchpoints. However, if you are not collecting this consistently and, as an example, ask for data you have already provided on the web but ask for it yet again on a mobile device, your consumers will not have the brand experience they expect of you.
Lack of Regulatory Compliant Data
- Publicly documented fines – California has put the legal foundation in place to administer fines for lack of compliance with CCPA. These fines can be painful. However, California is now staffing an agency to proactively work on collecting money for said fines. This work is publicly documented and no business desires to be on such a public list.
- Damage to reputation – Noteworthy and publicly shared fines can lead to a negative perception of any company which in turn is basically an assault on a company’s brand equity. Your reputation is literally at stake in today’s privacy world where governments are getting more aggressive on behalf of consumers and consumers can begin to bring their lawsuits. If you are the center of any of this activity, your company will take a hit to its reputation.
- Loss of consumer trust – At the end of the day, poor data governance is bad for business as all of the downsides that come with it can and do erode consumer trust. This is true for your current consumers as well as possible future consumers. If you lose the trust of your consumers, it is time to look at a new business or business model.