Data governance is more than just a trending term. It’s an essential requirement for today’s businesses and organizations.
When harnessed correctly, data can be the secret weapon for enterprises, providing a competitive edge through analytics, machine learning, and AI. But there are several enterprise data governance challenges that haunt IT leaders, day and night.
The key to capitalizing on data lies in its accessibility and comprehensibility, following a correct data governance framework. It needs to serve as a beacon of intelligence that drives strategic decisions.
However, this doesn’t mean free rein. Proper safeguards need to be in place to ensure data usage doesn’t jeopardize the organization.
Remember, data governance isn’t just an IT concern; it’s everyone’s business. And as they say, data is the new oil—it needs to be processed/refined properly, overcoming challenges and avoiding pitfalls.
So, without further delay, let’s move towards the challenges of data governance and solutions.
Top 8 Challenges of Data Governance:
(Click on any challenge of data governance to jump directly to it)
- Existence of Data Silos & Absence of a Single Source of Truth
- Distrust & Lack of Clear Ownership of Data
- Substandard Data Quality
- Insufficient Context of Data
- Limited or Misallocated Resources
- Perception That IT Alone Owns the Data
- Failure to Recognize Data’s Business Value
- Inadequate/Absence of Leadership
Top 08 Challenges of Data Governance & Their Solutions
1. Data Governance Challenge # 01
Problem: Existence of Data Silos & Absence of a Single Source of Truth
For IT leaders in various organizations, data is often dispersed across different departments, systems, and applications, leading to the formation of “data silos.”
This fragmentation of data storage results in inconsistencies and conflicting information, making it incredibly challenging to establish a single source of truth.
Without a comprehensive, unified data repository, decision-makers, particularly IT leaders, struggle to access accurate, real-time data that is crucial for informed decision-making.
Solution: Implementation of Unified Data Governance
The most effective solution to this challenge lies in adopting a robust, unified data governance strategy.
Organizations need to integrate data from diverse sources into one centralized repository to ensure data accuracy and uniformity across all platforms.
Utilizing automated data integration tools can make this process more efficient and less prone to human error.
Also, implementing rigorous data quality checks, comprehensive metadata management, and robust access controls are essential to preserving data integrity and ensuring data security.
2. Data Governance Challenge # 02
Problem: Distrust and Lack of Clear Ownership of Data
A common issue within organizations is the lack of trust in data among employees, which can impede decision-making and diminish the potential value of data-driven insights.
Frequently, there’s an unclear definition of data ownership and accountability, leading to confusion and skepticism amongst users.
Small, medium, or enterprise-scale organizations are equally plagued with this issue, which results in unnecessary delays and, often, heavy losses.
Solution: Designate Data Stewards and Establish Clear Data Ownership
To address this challenge of data governance, it’s imperative for organizations to designate data stewards who will be responsible for maintaining data quality, consistency, and reliability within their respective departments.
Establishing clear data ownership and accountability ensures data is considered a valuable asset, fostering increased trust among its users.
Data often originates from multiple sources/departments, and that is where the responsibility shall be, while with a holistic approach, it can be unified for clarity in direction.
3. Data Governance Challenge # 03
Problem: Substandard Data Quality
Substandard data quality is a significant obstacle that many organizations face, marked by inaccuracies, inconsistencies, and even duplicate entries.
These data shortcomings can lead to skewed insights, causing erroneous decision-making that could impact the overall performance of an organization.
Moreover, the costs associated with rectifying these data errors can escalate, adding an unnecessary financial burden on the organization.
Solution: Introduce Robust Data Quality Management Practices
To combat the challenge of substandard data quality, organizations must adopt robust data quality management practices.
This includes implementing automated data cleansing processes, which can efficiently detect and correct corrupt or inaccurate records.
Furthermore, validation and enrichment processes can enhance the accuracy and completeness of data, while regular data audits and profiling can help in the early identification and systematic rectification of data quality issues.
4. Data Governance Challenge # 04
Problem: Insufficient Context of Data
The issue of insufficient context of data is a prevalent problem that makes it difficult for users to fully understand and apply the data at their disposal.
The lack of necessary context can lead to misinterpretation, causing confusion, misaligned strategies, and ineffective decision-making.
This can result in lost opportunities and inefficient operations within an organization and, eventually, overall performance.
Solution: Implement Metadata Management
Metadata management is a potent solution to the challenge of insufficient data context for organizations of any size.
By establishing a comprehensive data catalog with metadata tagging, organizations can provide essential context for their data assets, outlining the source, purpose, and relationships of each data element.
This approach not only simplifies the understanding of data but also empowers end-users/IT leaders to make informed decisions based on well-understood and appropriately contextualized data.
5. Data Governance Challenge # 05
Problem: Limited or Misallocated Resources
Limited or misallocated resources pose a significant challenge to the effective implementation of data governance.
The scarcity of human and financial resources dedicated to this area can impede progress, leaving organizations ill-equipped to tackle data-related issues.
Without the necessary tools, expertise, and personnel, effectively addressing data challenges becomes an uphill task.
Solution: Allocate Adequate Resources to Data Governance
To overcome this data governance challenge, organizations must recognize and prioritize the critical importance of data governance.
This involves allocating sufficient resources – budgetary, technological, and human – specifically for data governance efforts.
After this, organizations can ensure that their data governance initiatives are well-supported, paving the way for their successful execution and achievement of desired outcomes.
6. Data Governance Challenge # 06
Problem: Perception That IT Alone Owns the Data
In numerous organizations, there exists a widespread misunderstanding that the ownership and management of data rest solely on the shoulders of the IT department.
Big or small, this perception is quite widespread, creating data governance problems and conflicts across departments.
This mistaken belief can contribute to a deficiency in data stewardship and a lack of accountability from business users.
Solution: Foster a Data-Driven Culture Across All Departments
To counteract this challenge of data governance, organizations must work towards nurturing a data-centric culture that spans all departments.
It’s vital for business users to comprehend their part in data governance and assume responsibility for the quality and precision of data.
The key to successful data governance lies in fostering collaboration between IT and business units, ensuring shared responsibility and commitment to data integrity.
7. Data Governance Challenge # 07
Problem: Failure to Recognize Data’s Business Value
In some quarters, data is viewed as nothing more than an incidental outcome of business activities rather than the powerful asset it truly is.
This oversight in recognizing the immense business value that lies in data can create a roadblock to the necessary investment in data governance.
It’s akin to having a gold mine and seeing it as just a pile of rocks—the consequences are then quite predictable.
Solution: Communicate the Impact of Data on Business Outcomes
To turn this around, organizations need to step up and illuminate the pivotal role data has in steering business outcomes.
It’s about narrating the stories of triumph where data-driven initiatives have led to remarkable successes.
By putting a spotlight on the benefits of high-quality data and its impact, we can shift the narrative, nudging more buy-in for data governance initiatives.
8. Data Governance Challenge # 08
Problem: Inadequate/Absence of Leadership
The absence of robust leadership in data often hinders the implementation and execution of new data governance standards and policies, leading to unwanted scenarios.
Teams are left directionless without a clear plan, putting all the resources and data to waste, which turns irrelevant with time.
Many organizations lack a dedicated Chief Data Officer (CDO) to manage data—an increasingly critical role that has now become a need of the hour.
Solution: Regular Reviews and Cultural Shift
In the process of building a data governance structure, it’s paramount to pause and assess – to ensure policies, delivery mechanisms, structures, and execution are clear and effective.
It’s not just about changing practices but also mindsets – fostering a culture that actively engages stakeholders and embraces data governance success.
IT/data leaders have the responsibility to identify and rectify any C-level negativity towards data governance, ensuring accountability and a positive influence on data owners across the board.
Understanding Data Governance
Data governance is the management framework that outlines how data is handled within an organization. It’s a set of rules and procedures that ensure data is collected, stored, and used in a manner that’s ethical, compliant, and effective.
Data governance defines data ownership, access rights, and responsibilities, ensuring clarity and accountability. Importantly, data governance isn’t just about control but also about extracting value.
High-quality data governance ensures that data is accurate and reliable, forming the foundation for meaningful insights and informed decision-making.
Implementing data governance isn’t a one-off task but a continuous journey of review and refinement. It requires a cultural shift towards respecting and understanding data, fostering an environment where data is treated as an asset, not just a byproduct of operations.
Understanding Data Governance Framework
A Data Governance Framework is a system designed to manage the quality, consistency, usability, and security of an organization’s data.
It helps in establishing processes, roles, standards, and metrics to ensure that the organization’s data serves its purpose and aligns with the company’s strategy.
The framework sets out who can take what action, upon what data, in what situations, and using what methods. This includes defining who is responsible for data accuracy, integrity, accessibility, and consistent definition.
It also ensures compliance with laws and regulations, reducing risks associated with mishandling data.
Understanding The Difference: Data Governance Vs. Data Governance Framework
While similar, data governance and data governance framework are two different concepts—often confused by many.
Data governance is like the rules of a game that help a company use its data effectively. It’s about who in the company can do what with the data, how they do it, and with which tools.
Think of a data governance framework as a guidebook. It explicitly sets out the rules for how data should be gathered, kept, and used in the company. It’s like a playbook that helps everyone understand their role and how to play the game correctly.
How Much Data Is There in The World?
Simple answer: a lot!
If that doesn’t cut it, here are a few mind-blowing stats about data:
- With the versatility of modern internet usage – be it via email, tablet, mobile device, or PC – the data generated comes in diverse forms and is unstructured, up to 90%.
- 2021 saw a staggering 79 zettabytes of data created globally, and this figure is predicted to double by 2025. Interestingly, only 10% of this is new data, while the rest is replicated.
- The past decade has seen a massive 5000% increase in the volume of data generated and consumed globally, escalating from 1.2 trillion gigabytes to a whopping 59 trillion gigabytes.
- A surprising 90% of global data is merely a replica, leaving just 10% as unique data. This ratio is expected to shift to 1:10 between 2020 and 2024.
Wrapping Up: Why Data Governance Matters
Think of a library without a librarian, with books and resources scattered everywhere. It would be pretty hard to find what you need, right?
That’s what it’s like in a company without a comprehensive enterprise data governance framework – there’s lots of important information, but it’s all over the place, scattered and unaccounted for.
Data governance is like having a super librarian who not only organizes everything but also sets rules about who can use which books and how.
In the case of a company, it’s about managing their data – deciding who can access it, how they can use it, and what tools they should use. This ensures everyone knows what to do and keeps the “library” tidy and useful.
So, in short, data governance is really important – it’s what keeps the company’s data in order and helps them make the most of their information, avoiding any of the enterprise data governance challenges.