S4 | Ep 22 | Why Would You Value Your Data like a Balance-Sheet Asset? with Simon Ferriter, CEO at Anmut
Apr 2, 2024
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Simon Ferriter, CEO at Anmut, discusses the valuation of data assets, the importance of understanding key data for decision-making, and the challenges organizations face in managing data effectively. He explores the financial methods for valuing data, the social impacts of data, and how putting a financial figure on data assets can drive improved decision-making and board involvement. The conversation highlights the under-investment in data management capability and the universal problem statements across industries.
Valuing data as an asset drives organizational value and investment prioritization.
Quantifying data value in monetary terms streamlines decision-making and improves operational efficiency.
Deep dives
Simon's Background and Journey to Anma
Simon Ferrita, CEO of Anma, discusses his fascination with human behavior and decision-making, emphasizing the importance of measuring data for better management. With experience at a major firm, Simon highlights the crucial role of data in business performance, digital transformation, and risk management. His shift to Anma was influenced by a desire to address data gaps hindering technology implementations.
Value and Importance of Data
Anma's approach focuses on measuring the value and fitness for purpose of key data to prioritize investments. Despite data growth and technology investments, leaders often face a gap in data comprehensiveness needed for strategic execution. Data understanding challenges hinder effective communication, leading to inefficiencies and risk. Anma advocates for treating data as a valuable asset to drive organizational value by prioritizing and investing in key data.
Data Valuation Methods
Various financial methods, including cost value, market value, and economic value, are used to assess data impact on business outcomes and bottom line contribution. Anma introduces a stakeholder-centric approach considering social and community impact. Valuing data as an asset enables comparisons and informed investment decisions, emphasizing the importance of prioritizing valuable data assets.
Benefits of Data Valuation
Data valuation helps organizations understand the importance and impact of data assets, enabling prioritization and efficient allocation of resources. By quantifying data value in monetary terms, organizations can streamline decision-making, improve operational efficiency, and mitigate risks. Prioritizing valuable data assets enhances business outcomes, driving significant cost savings and operational improvements over time.
In Episode 22, of Season 4, of Driven by Data: The Podcast, Kyle Winterbottom is joined by Simon Ferriter, CEO at Anmut , where they discuss why organisations are valuing their data like other balance sheet assets, which includes;
The framework for measuring the value and fitness for purpose of your most important data
The role of capital allocation in data assets
How most organisations don’t understand which data assets are important to success
If data teams lack the business/management acumen to communicate data effectively
Why data isn’t treated or managed like other resources and assets in an organisation
Not all data has equal importance to decision-making
Why the 80-20 rule is likely in play when it comes to data
Why data valuation is completely context-dependent
The three financial methods for valuing data
The importance of social impacts of data (environmental and community)
The benefit of putting a financial figure on the value of data assets
Why semantics around language are causing confusion
Why the financial figure isn’t the end result, it’s what that allows you to do from there
Why data valuation drives improved "value"
Knowing which data asset is important for which business opportunities
Why valuing your data captures the attention of the board and makes it their issue too
The under-investment in data management capability and the overinvestment in technology
Why the problem statements are fairly universal across industries and organisations
Why complexity means intangible assets are overlooked and often undervalued
Why accounting standards are no longer fit for purpose in the digital age of today
If data should be on the balance sheet
Investing in the upstream business process to prevent the need for new tools
The benefits that organisations are seeing from valuing their data assets
Why Anmut launched a product to help organisations to self-serve on this process
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