Our data is valuable. We need to keep it secure, not only to comply with data protection legislation, but also due to the risk to the business if we lose it. Modern accounting principles classify data as an intangible asset, just like software, intellectual property and the expert knowledge held within an organisation. Putting a value on your data is important, as it shows not only its worth to the bottom line of the business, but also highlights the costs involved if something goes wrong. It should be part of every higher education provider’s risk management and data governance plans. Doing a valuation exercise for your data can also change the perception of it from an IT expense to an asset that is worth investing in – hopefully ensuring its ongoing security and further boosting its value to the business.
There are a number of ways to put a value on your data assets, and the method chosen may depend on the nature of the data in question. The first method is to work out the cost to the business if the data were lost – how much would it cost to replace it, how would your income change without it? What financial penalties would there be, for example from the Information Commissioner’s Office, if the data was erased or stolen? In the case of student records, this could potentially be partially reconstructed from external data returns, but what about your day to day operational or financial data. The impacts of these losses are complicated, and often hard to determine, especially as this might be a new area for many IT and data managers. It can be a useful exercise to do, especially as it can feed into any cost-benefit analysis of new developments such as cloud-based backup systems.
A second method for assessing value is to determine how much your data is worth to a competitor, how much would they pay to get it. This is obviously a tricky area in the new era of GDPR, but there are probably data assets around your organisation that could potentially be sold, even if you decide you don’t want to do so. Your alumni data would almost certainly be of value to recruiters and others interested in marketing to recent graduates.
One final method, and one that’s almost certainly of relevance to higher education providers, is to assess how much the business is affected by having incomplete data. For example, not having accurate contact details for your former students means they won’t be contactable for the Graduate Outcomes survey. Not having accurate payment details means delays and staff time used in chasing up this information. Not knowing what schools are in your area will hamper your widening participation activities. These costs are often hidden – we may not know what we don’t know. By building up your data governance capabilities, some of these gaps should become obvious and you can start to plan how to fill them in.
Once your data has been evaluated, the asset value can then be used as one of your institutional metrics. It should be on any asset lists and balance sheets. Once there, it can be assigned some key performance indicators, which then allow managers to be rewarded for raising the value of the data, either by increasing its quantity or improving its quality. Having a clear value for your data also means there is an incentive for senior management to track it, monitor its usage, and invest in improvements, rather than just seeing is as a cost to be reduced.
Martha Horler is a Data & Compliance Manager and a member of the SROC Steering Committee. She has spent over 10 years working in higher education, much of that with data and information systems. She has a particular interest in raising data literacy across higher education, with the aim of making data more accessible to both users and senior managers. Follow her on Twitter @thedatagoddess