No business can operate without people, at least it requires the person that manages and represents the business, the CEO. S/he will need funds (Finance) to run the organization, hire additional people (Human Resources), rent a place for the business etc. The organization will develop products/services, acquire clients and look for suppliers. The business will collect and record Data, i.e. pieces of information about its products / services, clients, addresses, orders etc.. The recording of Data contributes to the organization's long-term memory, to information that can be shared within the organization to function effectively and efficiently, which by definition makes Data a resource.
In fact, Human Resources, Finance and Data are the
three essential business resources that any organization has always
been built on, independent of its size or industry, regardless whether it
operates locally or globally or whether its products / services are tangible or
not. Moreover, in various business branches (e.g. banks,
insurances, public administration) these are the only resources. (Herein, the term Finance is used to summarize all items which traditionally appear on balance sheets as assets or liabilities
and thus describe the financial status of an organization, including e.g. cash,
loans, real estate, machinery.)
The ultimate target of a business is to turn
resources into assets which implies that resources are governed to increase
revenue, to lower costs and to minimize risks, all in alignment with the
organization's mission and goals as well as with the legal and
regulatory requirements for the respective industry.
As the CEO is responsible to the Board to
accomplish the business targets, s/he may want to especially ensure that
managers at the senior level (VPs) contribute their share to the set out goals
and advise their subordinate management levels to govern the resources
accordingly. However, to be successful, such top-down
leadership also requires that the hierarchical structure remains horizontally
cohesive, i.e. departments on the senior management level do not develop as
independent organizational, cultural, informational or technical resource
silos.
While governing Finance and Human Resources as
assets had been established early on, senior-level driven cultivation of
business data resources has been neglected for decades. With the advent of information
technology, Data were considered to be a technical matter, and business
departments passed the responsibility for Data on to the IT department. As a
result, business departments became alienated from the Data that they created themselves.
It's time for business departments to not only closely encounter with
Data, but take ownership and responsibility to govern
Data as assets...
Stay tuned for my next post.
