11 November 2004 - New survey of Australian, US and UK chief information officers shows data management strategies are still not a top priority among senior executives.
Only 34% of respondents claim to be “very confident” in the quality of their data.
According to PricewaterhouseCoopers’ Global Data Management Survey 2004 of 452 companies in Australia, the US and UK, almost half of all respondents do not believe that senior management places enough importance on data quality. Surprisingly, board level engagement in data management issues has actually declined in the past three years, in spite of significant changes to global business operating environments triggered by events such as major corporate scandals and new regulatory compliance requirements.
Although 67 per cent of all organisations surveyed claim to have a company-wide data management strategy in place, up from 63 per cent in 2001, only two in five respondents are certain that their data management strategy has board approval. Only 59 per cent of all respondents think that the senior management of their company place sufficient importance on data management.
The survey also revealed that 63 per cent of respondents consider privacy, security and compliance with external regulations as the most important business driver, further raising the questions as to why there has not been a more substantial increase in board-approved data strategies.
“The decline in board engagement with data management issues is at odds with companies’ increasing dependence on data,” said George Marinos, Partner, PricewaterhouseCoopers, US. “With corporations establishing objectives of improving their level of transparency, and the clear linkage between data quality and reporting accuracy, it is surprising that having a data quality strategy is not top of mind for board level executives.”
This year’s survey also highlighted the fact that most organisations still view data quality management as an IT issue. About two-thirds of respondents with a data strategy claimed that responsibility for driving that strategy belonged to IT. The remaining respondents assigned responsibility for data management to senior management within their organisation, such as the CFO, CEO, managing director or corporate board.
Confidence in third party data has eroded
Over half of the respondents indicated that sharing of data to third parties is likely to increase over the next three years. Yet while respondents also indicated they are at least “somewhat” dependent on third party data, only 18% of respondents whose organisations share data with third parties are very confident in the quality of that data. Only 24% of companies claiming to use third party data are actually measuring the quality of that data. Fifty per cent of respondents are at best only ‘fairly confident’ in others’ data while 24% express little to no confidence.
“With today’s collaborative e-commerce economy, it’s surprising that companies are not more formally engaged in validating the integrity of third party data,” said Henry Kenyon, Partner, PricewaterhouseCoopers, UK. “With an expected increase in the need to share data externally among companies, regulatory bodies and stakeholders, senior management must resolve to create and execute a strategic and actionable data quality program to validate not only data they receive from third parties, but the data they share with third parties.”
A critical gap between intention and execution
From the respondents that stated they did not have a formalised data management strategy, 81% agreed that their company should view data management more strategically and believed this could be accomplished within the next three years. For those companies that did not feel confident that they would have a formalised strategy, the primary barriers included lack of:
- Budget
- Board support
- Appreciation of the benefits
- Knowledge about how to best manage the data
- Belief that there is a problem
“We are beginning to see organisations taking a more strategic approach to data management, and we’re telling them that it can be viewed as a competitive advantage,” said Willie Jordaan, Partner, PricewaterhouseCoopers, Australia. “A comprehensive data management programme can help companies reduce the costs associated with risk and compliance, as well as improve the company’s overall business performance. The commitment to data quality needs to be driven from the top, with a clear line of accountability threaded throughout the company. Data quality is not simply an IT issue, but it is an imperative for the entire organisation.”
Best practice organisations realise a positive pay-off
Respondents able to cite data management initiatives that produced a positive return on investment represent companies who do pay attention to data quality issues. Ninety per cent of these best practice organisations responded that senior management does pay sufficient attention to data management. In addition, 60% of these companies measure the quality of their data compared to only 45% of overall respondents. Confidence for best practice organisations is also increased, with 45% feeling “very confident” compared to 34% overall.
Note to editors
The Global Data Management Survey 2004 interviewed the Chief Information Officer, IT director or equivalent executive at 450 companies across the US, UK and Australia. The sample included a broad mix of major ‘Top 500’ corporations and middle-market businesses, providing a representative cross-section of corporate activity in each of the three countries.
PricewaterhouseCoopers (www.pwc.com) provides industry-focused assurance, tax and advisory services for public and private clients. More than 120,000 people in 139 countries connect their thinking, experience and solutions to build public trust and enhance value for clients and their stakeholders.
“PricewaterhouseCoopers” refers to the network of member firms of PricewaterhouseCoopers International Limited, each of which is a separate and independent legal entity.
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