Data as MUDA

Accounting Truism #2 for Data:  Unmanaged Data Liabilities Erode Data Equity

The accumulation of data assets, coupled with an ignorance of their associated liabilities (such as security vulnerabilities or regulatory exposure), will shrink net data equity. In accounting terms, high liabilities offset the value of assets, reducing their actual value.

 What are some examples of mismanaging data liabilities?

• Failing to keep sensitive & privileged data secure from those w/o business need to know.
• Allowing multiple versions of the truth - not managing lineage.
• Keeping data around for longer than is required by law or policy.
• Continuing to operate data pipelines to feed products that no one uses or trusts.
• Perpetuating knowledge silos, resulting in redundant, misaligned products and/or capabilities.
• Keeping humans with business need to know from accessing all categories of data on demand.
• Failure to meet T&C's of data contracts and service level objectives.
• Failure to detect and manage out-of-range defects in aggregates.
• Not using repeatable tactics and/or a scalable, adaptable architecture.

There are really too many ways to mismanage data assets to count here easily.  Perhaps some of the larger data community could share some of their favorites.  However, the negative consequences to businesses are a bit easier to summarize:

• Data loss and security breaches, resulting in possible civil, criminal, and reputational penalties.
• Loss of trust by clients, customers, internal consumers due to problems with quality, timeliness, conflicting versions of the truth.
• Serious degradation of data assets' value from compounding liabilities to continuously iterate through defect resolution cycles and service objectives failures.

Look at the Liabilities category in the drawing above. These are all areas where mismanagement and neglect will drive down the real and perceived value of your data assets and products.

Let's get serious about managing our data's liabilities for maximum equity.