Data Monetization
Every organization today has access to vast amounts of data. Data about operations, finances, customers, supply chains, human resources etc. Yet the majority of them are not equipped to monetize all the hidden potential in their data. Insights that can help make their business processes more efficient and create new revenue streams.
Now, for every organization the path to data monetization is different. It is going to be defined by their analytical maturity, the extent of digitization and their core business, i.e. in other words if analytics is at the core of their product offering.
For businesses that predate the data revolution and or the internet, this comes with its own set of unique challenges that are not relevant for organizations that have come into existence in that last decade. While every journey in data monetization is different, there are some common pit stops or milestones that show up on every map.
You cannot monetize data that no one can use.
Data monetization does not transpire from a single “eureka moment” but rather it is often a result of relentless, committed and clear data monetization strategy. It is fueled by investment and commitment and a clear alignment with the organizational strategy. There are two main paths to data monetization:
Internal- Leveraging data to optimize and improve an organizations internal operations and processes and decision making. Often results in efficiency gains and cost reduction.
External- By making data available in a usable or marketable offering to customers and external organizations thus generating new revenue streams. External offerings can be in the form of:
Data as a service: e.g. anonymized aggregated geolocation data by telecom services.
Insight as a service: e.g. Point of Sale data by NPD where a company can combine different data sources to enhance insights and product offering.
Analytics Platform as a service: The most advanced and lucrative of the options that provides the greatest value to the customers. e.g. GE makes predictive and prescriptive analysis to a users energy usage, maintenance etc allowing cost reduction decisions and streamlining operations.
While these internal or external paths are not mutually exclusive any initiative ultimately needs to align very closely with the organization’s overall strategy and objectives with close partnerships between the business and data professionals. Data by itself is often not sellable or even usable in its rawest form, it requires to be processed, enhanced or correlated with other data sources to garner intelligence or insights.
Data Monetization requires strong product leaders
Implementing Data monetization initiatives requires strong product leaders, who treat core data and service like any other product innovation. They hold it and their commitment to the same stringent quality standards as any other physical quality standards.
Product leaders like most leaders invest in and assemble high-performing teams, re-define processes, acquire skills and foster culture to generate maximum returns. It is equally important to decentralize decision making leading to local empowerment and distributed accountability allowing the project to be more agile in its approach of crafting its product offering. It allows for faster iterations and efficiency gains.
Before anyone can embark on the journey there needs to be certain building blocks in place necessary for its strong foundations. Before you can monetize it you need a robust and scalable data factory that automates the process of collecting, transforming, enriching and garnering insights from data. Whether you build, buy, lease or partner, the goal is to create a single source of truth by data storage, harmonization and processing.
Operationalizing a data monetization strategy demands a robust governance model that considers relevant compliance and guidelines across all the teams. As we set up more exhaustive and competitive data factories, we need to adhere to principles of cybersecurity and privacy in our architectural design from the outset and not something to retrofit into a finished product.
Ultimately at the heart of any transformational change there is a human element. There are two ways any change can be implemented, one where it is mandated from the top and the other where you cultivate the culture where the desired change is pushed and affected by the teams. One of them is easier to do but the other is more sustainable and brings greater and richer dividends.
Ultimately, data monetization is an opportunity with a non-unique solution. Irrespective of the path you pick and the approach you take, it is going to be a rough and intense ride. You need a team and a leader with a high degree of integrity, accountability, vision, relentless ingenuity and a sense of complete ownership of the process and the outcome. It is possible that the path will be littered with a lot of failures but it is one of the most rewarding journeys for any team and organization.
“It is never too late to be what you might have been!”
