Data Governance (Part Two)

This is the second of two articles introducing the concept of data governance.

Now we’re going to introduce a theme that will return over and over again in different contexts throughout this blog: if you’re the boss, you need to be on board for any of this to work well. By “the boss” I mean the owner if it’s a small business, and a non-IT C-level executive (Chief Executive Officer, Chief Operating Officer, Chief Financial Officer in that order of preference) if it’s a larger business.

Why this order of preference? The CEO by definition has the most clout: typically the COO and Chief Information Officer (CIO) both report to her, and she can easily delegate responsibility for the data governance process jointly through them. The COO, having direct responsibility for day-to-day operations, is the next best choice. The CFO is more of a dicey choice because in most mature businesses IT grew up as an arm of finance and accounting and was later split off into a separate unit. Because of this, the relationship between IT and finance and accounting is often either too cozy (if the split was friendly) or too adversarial (if it wasn’t).

And why do we need the boss on board in the first place? Especially in larger companies, politics can play a huge role in the governance process. It’s only natural that stakeholders in the governance process will fight tooth and nail for the definitions, policies, and procedures that are most favorable to their business units. The boss needs to firmly and consistently champion the process as a whole, and to set guidance that places the overall business strategy for data governance above departmental politics.

Data Governance (Part One)

This is the first of two articles introducing the concept of data governance.

Consultants and experts in the BI field use the terms “data governance” and “data integration” to talk about how to approach the kinds of problems we’ve been discussing in this section of the material. These fundamental concepts lie at the heart of the “integrated and coordinated” part of the definition we gave earlier for BI as a whole.

When we defined BI we said that both the data and the definitions of what the data mean need to be shared. “Data Governance” is the term that BI professionals use for the process of making sure that happens. This includes things like setting policies and procedures for how data are to be captured, processed, and stored, defining what terms like “revenue” mean for the purpose of making business decisions, defining what is acceptable for knowledge workers to do with data that are being used for decision purposes, and more. In short, what is being governed is the BI life cycle itself.

How data governance works depends mainly on the number of people with a stake in the process. In a small business, the owner may be the only person with a stake. So that owner will call the shots. In a larger business there may be many people of relatively equal clout with a stake in the governance process, and a significant amount of time and effort may need to be expended to make sure each voice is heard. In many larger companies today you may actually find a data governance board, made up of representatives of the IT and non-IT business units, whose mission it is to set corporate standards, policies and procedures for data governance.

Next time: The importance of top management buy-in for successful data governance.