Introduction
A Data Office is not a new concept as I’m sure Wikipedia or google would tell you right away. Over the past few years though there has been an increasing emphasis on understanding and monetizing data as businesses try to optimize their revenue sources. More and more firms are starting to take a hard look at the data they capture and store and gain valuable insights from it. Having an executive accountable for that data is now more common and we have the Chief Data Officer or Chief Data and Analytics Officer being duly defined as a position.
The challenge however lies in defining what that CDO would actually do. That’s where the roles and responsibilities differ based on the nature of the business as well as the people running that business.
Functions of a Data Office
The more common functions of a chief data office include the below:
Data Governance/Stewardship
This typically includes creating and managing data assets and defining the requisite metadata. Most importantly it involves assigning and managing the right roles and responsibilities for the actual usage of data
Data Management and Usage
Usually dealing with large programmes of work to define the holistic data needs of various parts of the organisation and driving the change through while staying in governance
Data Quality
The only reason I put this separately (most organisations would put it into the Governance head) is that this deals with physical data and not just metadata. Often this requires more specific technical skills and has more to do with understanding data at the core of it.
Analytics
The more fancy aspects of the office usually including but not limited to front-end visualisations, insights, data sciences and machine learning
Legal and Regulatory Compliance
This applies to regulated businesses such as Banks where the expectation is set from a regulator. The demand is often to have the data office held accountable for maintaining the quality and accuracy of the data. It also involves Records Management – Maintaining physical or electronic records across the organisation and engaging with various suppliers as well as legal counsel to ensure privacy and other regulatory asks are met.
How will this work for a business?
On the whole, the main role of the data office is to ensure that data is used appropriately within the firm. All activities performed by the data office inadvertently tie up to that mandate and have significant consequences across all aspects of the business. I will try to illustrate with a simple example which may potentially apply to most businesses – Sales.
A sales team typically has a prospecting methodology which is followed to bring in additional revenue to the firm. A list of potential customers can be prepared by numerous data sources – social media, tele-marketing, cross-selling to other customers and so on. Analytics can help identify customers where the probability of success may be higher and therefore the sales resources can be efficiently deployed. However, Analytics is only as good as the data that goes into determining it. A prediction with a low confidence would only waste valuable resources if the underlying data has gaps. Data Management and Data Quality therefore become essential to ensure we look at the right data. If governance was in place, it would make it simpler for an analytics team to search for all possible data points, discuss those with the actual data owners and bottom down on a more confident model for prospects. Bear in mind, this is all customer data and sensitive in nature. We don’t like it when tele-marketers call us without consent or flood our inboxes with products we don’t want. A regulated entity could get into trouble if this data is used wrong even if it is inadvertent.
Where does a Data Office actually sit?
Notice that each of the functions I’ve highlighted tie up into the actual revenue stream. If properly used, they can enhance it significantly. A CDO would therefore be an enabler for any part of the business but would not typically own a business (more on that later). To put things in perspective, every organisation will have data which only a few select people would actually understand. A data office should ensure that this knowledge is appropriately maintained and work hand in hand with businesses to mitigate any risks. Depending on how the firm is structured, CDOs can roll up into Operations or Technology but they need to have strong partnerships across all parts of the organisation. They should therefore not be restricted in scope if an organisation desires true change.
Closing Comments
It’s a difficult role to play considering data permeates every aspect of an organisation. However, no CDO can be successful if the firm itself is not committed to data at the top. A CDO is a not a magic wand to take care of all data problems, nor are they just there to document everything. A great Data Office can build a culture where data driven decision making will thrive but they cannot do much without support across the organisation. Beware that the CDO doesn’t become a uni-dimensional governance setup which would be bureaucratic and ultimately frustrate everyone in the firm. So if you have a data office or are thinking about getting one, my recommendation is to enable and support them to understand data as they set things up. They may not always know the business but once they understand the data, they will be able to add tangible value. That’s what everyone ultimately desires.