New Survey Shows Urgent Need for Data Governance Technology

Information Difference just published a new study based on a survey exploring the links between data governance, master data management (MDM) and data quality. While it’s full of insights, I’m particularly struck by how urgently companies are expressing the need for data governance technology.

Demand for products come from expressed need or latent need. When potential customers can articulate what they want, these are expressed needs. People want a car that sips fuel, so Toyota built the Prius. On the other hand, when a product is embraced by the market without customers asking for it, it’s uncovering a latent need. The best example of this is the Apple iPad. For a product that meets a latent need to quickly reach mainstream adoption, it requires a lot of resources, something Apple had in abundance. Or it requires a lot of time traveling by word-of-mouth. If you’re a parent with young kids, you must know about Sillybandz. What you may not know is that they’ve been around for several years before it became a national craze.

When we set out to build a brand new product specifically for data governance 2 years ago, we projected that early mainstream adoption would begin in 2013. In our early market research, we talked to companies that had data governance programs in place. From our sample, a small number of mature companies expressed the need, while the rest saw the value only after we described what we had in mind. Since then, we’ve seen a regular drumbeat of both hard data and anecdotal evidence that data governance software market is arriving faster than we had anticipated. We now believe the data governance software would enter early mainstream late 2011 or early 2012. Why? Because we see a rapid increase in the number of companies that express the need. They’re in the market looking for a product with a specific set of features.

Let’s dig into the data in this latest data governance survey. Of the companies that have data governance programs in place already, nearly one third have custom built tools to support data governance, while 39% rely on email and spreadsheets. Another 8% use a general purpose workflow tool. While we knew that many companies have cobbled together tools for data governance, it’s startling how prevalent it is. The study correctly concluded that “Clearly this is an area requiring urgent attention from vendors since there is a gap in the market here.”

Of the companies that plan to implement data governance, 8% plan to use a “specialist data governance tool”, as opposed to MDM, DQ, or other tools in adjacent markets. As far as we know, Kalido Data Governance Director is the only specialist data governance tool in the market, and we announced it just 2 months ago.

The survey asked about how data policies are communicated. 45% publish them on an Intranet, while the rest use some form of documents like Word or PDF. On the topic of measurement, for companies that have already implemented data governance, 80% — a surprisingly large number — are measuring and monitoring data quality. Of the companies that plan to implement data governance, a staggering 93% plan to measure data quality. This validates our view that policy management, workflow, and data quality measurement are the core capabilities in a data governance product.

Beside the survey, we have another clear data point: customer response to our product. When we set out to establish a Lighthouse Customer Program for Data Governance Director, we set a target of 12 companies participating in the initial phase. In just two months, with nearly no marketing, we have 15 and it’s growing almost every week.

I can explain it this way. There’s a lot of pain: the pain of bad data and the pain of implementing data governance without built-for-purpose technology. So this is not about a technology looking for a problem to solve. The problem is clear and urgent: the latest evidence is this Information Difference survey.

2 replies
  1. Leonard Anderson
    Leonard Anderson says:

    One of the areas of greatest need for data governance, certainly in the UK, is public sector data sharing. What advice do you offer to that different accountable bodies, eg local authorities, police, health service and government departments?

    None of the individual organisations are yet at the starting blocks – can something be done for data that crosses the boundaries?

    • Winston Chen
      Winston Chen says:

      Yes, the public sector ought to embrace data governance in a big way. I think data governance adoption will happen at organizations that are both data and process intensive. Public sector definitely fits the bill.

      Because data governance rests so much on organizational structure, it’d be hard to get it going in the absence of a responsible person or group. So, if there’s nobody put in charge of inter-agency data sharing, it’ll be very hard to get anything done. So I’d start by finding your champion.

      For organizations that are earlier in maturity, I think MDM is a great way to kick start data governance. In trying to implement MDM, organizations will quickly realize that data governance is needed.

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