Clutch Group Director Michael Recker’s Article (Co-Written by Richard Kessler) Published by Inside Counsel.
Clutch Group Director Michael Recker’s Article (Co-Written by UBS’ Richard Kessler) Published by Inside Counsel. The article helps organizations address risk and remain compliant while dealing with rapid and pervasive change. The full text of the article can be found below. Follow the link to read it on the Inside counsel site.
The governance fabric: Applying simplicity to the velocity, variety and volume of data
The stakes are enormous, and failure to keep up can be costly.
Sometimes the pace of change can be a little dizzying. Just ask any legal or compliance executive at a major global company. Not only must they keep track of and adhere to an ever-expanding list of complex regulatory requirements, they must somehow also accommodate an exponential growth in the volume, variety, and velocity of data.
The stakes are enormous, and failure to keep up can be costly. Financial services, energy, life sciences, and technology companies continue to be on the receiving end of over $311 billion in regulatory fines and settlements (The Guardian, WSJ, and ProPublica). By the end of 2015, annual spending on Big Data will be around $2.8 billion (Forbes); this number is expected to someday reach $40 billion. Striking the right balance between sustainable profitability, systematic compliance, and effective risk management has never been more important – or difficult.
The Threat of Decentralized Data
Enterprise data is now everywhere. To make matters more complicated, this data is rapidly becoming more complex and diversified, making it difficult to devise cohesive data management policies. Social media is particularly amorphous. Consider Snapchat, which started as an app primarily used to send vanishing photo messages and videos; it has now evolved into a complete messaging app that supports traditional chats.
At the institutional level, the mainstream use of mobile devices and BYOD (Bring Your Own Device) has challenged IT departments to support and understand where data is located and how it can be accessed. Corporate chat platforms that used to be centralized now have the capability to be used on an array of devices. The overwhelming accessibility of mobile devices such as iPhones and iPads is seriously disrupting typical models for communication.
With this diversity of data sources, cyber security threats have multiplied. Recent studies show that 43 percent of companies experienced a data breach in 2014, up 10 percent from the year before (USA Today). The aftermath of many recent cyber-attacks has led to the ousting or resignation of senior management at the affected companies.
So how does an organization address risk, sustain profitability, and remain compliant while simultaneously dealing with rapid and pervasive change? The answer is by embedding simplicity into its corporate data governance.
Astro Telier, Head of Google X, has said that “It’s easier to make something 10 times better than to make something 10 percent better.” We need to embrace this mentality. If companies are to successfully combat constant change, they need to embrace new thinking and make simplicity the bedrock of their corporate fabric. This “governance fabric” should permeate every aspect of an organization, and it should begin with data.
Consider relatively recent changes in the software development industry, a proven bell-weather industry for technological innovation since the 70s. Waterfall development, the traditional sequential process of design, is rapidly becoming antiquated, while agile development, characterized by self-organizing, cross-functional teams, has become mainstream. Development cycles are shrinking from years to months to days.
A similar change is imminent in the universe of data management and it’s going to change the way in which we see and manage data. The long-term success of essentially all large companies is more dependent on a revised approach to data management than many in executive leadership appear to realize.
Say, for example, that you need to investigate the conduct of various employees and must recreate all correspondence over a specific period of time, reconstruct documents, and identify and organize disparate communications streams.
Recreating all of this information is extremely difficult and time consuming – but by creating standardized metadata fields (such as time, client, employee, product, and account) across the board, teams can quickly make decisions about large sets of data. This simple data governance structure can provide corporations with valuable information for identifying patterns in complex transactions while identifying best practices and improving detection and response times. A vast simplification of a process that would usually take months should now only take a few days.
An Enterprise Data Governance Revolution
As organizations work to simplify their approach to enterprise data governance, they should also think about breaking down entrenched silos. Traditional corporate structures can be significant barriers to functioning as a true data-driven organization. At a minimum, a ‘flexible governance fabric’ needs to be woven into the core culture of a company and requiring fundamental changes to each and every department and employee’s role. For example, policies, processes and procedures need to encompass any data – including that which exists outside the company — such as data on personal devices used for business or data hosted by third parties.
The importance of utilizing metadata and proactively managing data correctly can’t be understated. Companies who understand this and can adapt and govern this rapidly changing asset will continue to thrive. Along with embedding simplicity into processes with them aim of becoming more agile, companies must develop a holistic approach to governing data. If they don’t, their competitors will. This is not a choice for corporations living in the age of Big Data. It’s an imperative.
Michael Recker is a Director at Clutch Group, a global provider of litigation, investigation, compliance, and other services for Fortune 500 companies.
Richard Kessler is responsible for Information Governance at UBS including records management, legal/regulatory archives, information lifecycle governance risk management, corresponding policies, and strategy.