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#DATAVERSITY
You
r Sp
eak
ers
John LadleyPresident
IMCue Solutions@jladley
Tony ShawCEO & FounderDATAVERSITY@tonyshaw
#DATAVERSITY
• A new webinar series on the first Tuesday of each month (mostly)• Upcoming Topics:
- Data Governance- Advanced Analytics- Roles, Function and Hiring of CDOs- Risk Management- Data Business Models- New Technologies you cannot ignore
…and much more!
#DATAVERSITY
• Metrics and Measurement• John Ladley, President of IMCue
- 30 years experience. Former Meta Group Analyst- Author of two major books on EIM and Data Governance- Data Strategy, Information Risk, Organizational Structure, Analytics- Practical reputation
All content copyright 2013 IMCue Solutions LLC 0
Metrics for Information
Management
Discussion
Can data or information cost your company
or organization $$$$$?
Is there a broad economic impact of data and
information?
If you answered “yes”, show me how much?
1
Accounting reasons:
• Information is an asset
• It has a probability of generating future value
• It is distinct from financial and material
assets
• Compliance with Financial Accounting
Standards Board Statement No. 142 —
measuring intangible assets
Practical reasons:
• Information affects the organization in visible
and most likely measurable ways
• Information assets are rapidly becoming a
significant business element
Why worry about information metrics?
Objective
Leave with some new views
about measuring tools
to sell and sustain
information asset
management (IAM)
3
Presenter / co-author
John Ladley
– 35 years EIM experience in various capacities
– @jladley
Doug Laney
– Currently heads thought leadership, and
advisory services with Gartner Analytics
– Authored 100+ articles and
research pieces, and
speaks now-and-again.
– Initiated Infonomics as a
formal approach to information
management in the 1990’s
4
Agenda Terminology
Measuring Information – Information as an asset
– What is an asset
– What do you need to measure?
Measuring assets
– Metric taxonomy
– What types of metrics are there? There is a lot more to measuring than common ROI
Value, effectiveness, income statement and balance sheet
Samples
5
Terminology
Information – ALL enterprise content that can
be used to further the survival and
achievement of business goals– Data = information = content (for this discussion)
Information Asset Management
– The treatment of data, information and content as
an asset in the true, business sense
Enterprise Information Management (EIM)
– The program that executes IAM
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Terminology
Infonomics
– The economics of information and principles of
information asset management
Doug Laney of Gartner Group
– The accounting and measuring aspect of
information asset management
John Ladley
Data Governance
– The oversight of IAM; sets rules of engagement ,
i.e. policy, roles, accountability, responsibilities for
EIM and IAM
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What does Information Asset really mean?
Metaphor
– Example from Thomas C. Redman, Ph. D.
8
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Real asset Goodwill is intangible, appears on the balance sheet,
and can certainly be ‘used up’
Electricity is “used,” but there is always more in the wire. We buy and sell kilowatts
Ideas can be copyrighted, bought and sold
We trade information every day for something. Do you have a Twitter™ or Facebook™ account?You are worth $101.70!
10
What to measure - The information supply chain
Ap
plic
atio
nA
dm
inis
tra
tio
nA
cq
uis
itio
n
How is information
providing business
value?
What are we
doing to add
value to the
information?
Where are we
getting
information
from?
Generate
Purchase
Trade
Capture
Observe
Search
Rent
StoreSecure
Assess
IndexTag
Inventory
Integrate
Organize
Encrypt
Backup
Transform
Delete
UpdateCleanse
ProfileReplicate
Describe
RefreshTranslate
Deduplicate
Package
Access
Alert
Transmit
Sell
TradeReport
Visualize
Analyze
Deliver
Lend
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How to measure – core concept
The “algebra” of R
Where C= Create, U= Update, D = Delete, R = Read
If Value = Usage , and Usage = R, then Value = R
Therefore Information Value = R
– Then Information Costs = C + U + D
Unless information is used (read) it has no value other than the sunk cost to produce the data (transactions)
The IAM business case happens where data is used – just like “normal” assets
IAM business case: Rbenefit > Ccost + Ucost + Dcost + Rcost
How to look at information value measures
Financial performance Balance sheet
– Information asset valuations
$101.70???
– Capitalized information-based revenue streams
– Shareholder trust
Reputation (Social media, regular media)
Compliance risk assess (identifier quality, contingent fines)
Protect privacy
Accuracy
Complete
Income statement– Incident costs
– IT costs
– Project initiation costs
– Error* handling costs
– Data risk assessment
– Insurance premium
– “Line of sight” metrics
1414
Measuring program effectiveness
Efficiency
– Measure how well
governance applies its
resources
Risk
– Delta of risk
Improvement
– Amount of improvement /
delta from a “state”
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Efficiency
Total cost of IT / Party (Customer, Member, etc.)
End User Labor / Number Users
Total BI/DW Budget / Total Users, and / or Support
Number of interfaces, File feeds
Cost per Interface
DG / Compliance cost divided by Total Income
DG / Compliance cost vs. risk reserves / premiums
Budget / TB (GB)
Benchmarks – Number IT tools
– Maintenance budgets
– License costs
– Training costs
16
Risk
Threat metrics
– Cost per downtime event
– Loss of customer confidence
Financial Risk
– Liquidity
– Operational costs
– Equity / market value reduction
Data Governance Compliance
– “Hits” on web-based tools
– Access counts on repositories
Legal Compliance
– Potential penalties per subject area
– Litigation fees over time
Improvement
Operating Income by Knowledge Worker
– Operating Income for year divided by number of
Knowledge Workers
– Knowledge worker is defined as someone who uses
information to make decisions and take actions that cause
the fulfillment of objectives, reads information
IM Project NPV
– The net present value of the cash flow expected from IM
projects over 5 year planning horizon
IM Portfolio NPV
– Net present value of the current information assets
expressed as pro-rated portion of free cash flow
17
Summary
Measurements of
information value and
effectiveness are
viable
There are many many
options to present the
value of an
information program
Saying it cannot be
measured is not an
option
18
All content copyright 2013 IMCue Solutions LLC 19
Building Value Through Information Asset Management™
314-422-9076
19
