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Lydia Clougherty Jones
December 9, 2022
5 Min Read
Data sharing is essential for data and analytics (D&A) to generate enterprise value and is a key performance indicator used to measure D&A success against business objectives. According to Gartner’s 2021 Chief Data Officer Agenda Survey, D&A leaders who have successfully met data sharing, data monetization, and customer experience KPIs are also more effective at providing stakeholder engagement. Gartner predicts that by 2026, over 50% of commercial organizations will have established initial efforts for formal data monetization. Deploying a disciplined effort to align collecting, using, and sharing personal data for both commercial and consumer benefit is even more important as business disruption, economic uncertainty and global political unrest demands better organizational resilience.
Yet simultaneously, D&A leaders are facing increased customer and regulatory pressure to prioritize privacy and data protection. Today, nearly 160 countries with data privacy laws are attempting to control personal data collection and use while mitigating the risk of downstream data misuse. Gartner predicts that by the end of 2024, three-quarters of the world’s population will have its personal data covered by modern privacy regulations. The demands for customer data protection are not only regulatory: Privacy-driven trust serves as a key differentiator when customers are looking for a reason to pick one brand over another in a homogeneous market.
D&A leaders must adopt a deliberate and systemic approach to identify, uncover and implement data monetization and personal data sharing opportunities if they are to introduce and maintain the data-driven innovation necessary for their organization’s economic success. Concurrently, D&A leaders must strategize how they can scale such opportunities to meet demand for the personalized data products and services consumers crave, while protecting those very customers from data misuse. The increasing volume and detail of personal data collected by consumer-facing organizations offers huge opportunities for personalization and value creation, but consumer trust is the deciding factor as to the extent to which organizations can leverage this data.
The Value of Data Sharing
Data sharing is an essential business capability, captured specifically to discover, use, and reshare data. It is also a business necessity for digital transformation. It satisfies demand for more robust predictive analytics, aggregating diverse data sources, and driving relevant or otherwise unknowable insights for data-driven innovation.
D&A leaders at high-performing organizations promote data sharing or increase access to the right data aligned to a business case. Gartner research shows that organizations that share data externally with their business partners generate three times more measurable economic benefit than their counterparts that do not. Effective D&A teams are two times more likely to generate measurable benefits from sharing data externally.
Data sharing and monetization strategies are not just to the benefit of the enterprise, they also have value for customers. There has been exponential growth in consumer demand for data products and personalized services that require the collection, use and sharing of personal data, including location data. According to a recent Gartner survey, nearly half of consumers say that they are accepting of online behavior tracking in exchange for better personalization. For example, consumers that share activity and health-related or lifestyle data may be able to receive better nutrition and activities recommendations from wellness applications. Sharing location information with law enforcement could increase the efficacy of victim safety programs.
Organizations should consider the opportunity to leverage data to meet currently under-met demands for personalization. This would generate economic value for the organization and its local economy, while also giving consumers what they crave. But, to achieve this win/win, organizations need to relentlessly prioritize protecting the data that customers are sharing and the individuals named within those datasets from misuse.
The Privacy Balancing Act
When deciding whether to address customer demands that require collection, use and sharing of their personal data, D&A leaders must consider the balance of economic and consumer value. Too often, a focus on regulations and legalese gets in the way of this conversation. Legal discussions about data-driven initiatives are often constrained by risk avoidance mindsets, which limits business impact and value.
To prioritize business outcomes, executive leaders must focus data collection and monetization discussions on revenue generation, cost savings, and balanced risk mitigation. Start data sharing and monetization efforts by identifying known desired business outcomes, as well as unknown opportunities, for quantifiable economic benefit. Organizations can expend sizable investments for personal data rights, including the right to use/reuse and share/reshare data, but not all rights procured will match your business case, be relevant to consumer demand, or even be enforceable, resulting in economic waste. Invest resources to obtain legal rights to locate, use and share the “right” data to match your targeted monetization use case.
Create a culture of responsible data use throughout the information product life cycle. Make it clear to D&A teams and business stakeholders that “just because we can do something doesn’t always mean we should.” Proactively approach customers and partners for their thoughts on data sharing and monetization strategies, considering this from both an ethical and customer value-add standpoint. This question should not be an afterthought as reputational slip-ups can sink a company faster than technological or organizational ones.
Done well, data sharing can maximize benefit across the commercial, regulatory, and consumer demand ecosystems. It is not only worth the hassle, but also a business necessity to survive in these uncertain economic and political environments.
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