The lack of effective big data governance in the digital age is a growing problem. From 2013 to 2014, big data breaches increased by 64%. In 2016 alone, 1.1 billion identities were stolen. Experts predict by 2020; big data related damages will cost the world $6 trillion. From the machine learning to the internet of things, the boardroom is no longer exempt from responsibility as it relates to the opportunities and risks posed by increasing volumes and usage of big data. Public interest in ethical leadership in business continues to grow due to the continuing vacuum of effective management in many of our leading organizations.
In 2017, 42 states across America introduced over 240 cybersecurity-related regulations. With growing concerns on accountability in the digital age, the Center of Strategic and International Studies has been advocating for a National Cybersecurity Safety Board. Furthermore, US federal regulations have recently proposed a plethora of information governance accountability requirements that could present more severe civil and criminal penalties in the future. With increased pressure from the public, those serving in governing roles are now under more heightened scrutiny than ever before. Despite numerous peer-reviewed research findings that have demonstrated how essential high-level support is to effective information governance, many governing bodies still do not to have the necessary knowledge to govern effectively.
While organizations have collected and analyzed data for many decades, big data leverages new and powerful algorithms that have changed the entire environment on how opportunities and risks can be assessed and acted upon quickly. Big data is generally more complicated, faster and more varied than traditional datasets. With the explosion of big data sources from telematics, text, time and location, radio frequency identification, smart grid, telemetry, and social networking, there is unpredicted opportunity leverage both structured and unstructured data to gain insights into customer behaviors, desires, and opinions. With these opportunities comes new risk which is reflected by scandals by Equifax, Yahoo, and Facebook’s Cambridge Analytics. When dealing with a company’s big data assets, Board of Directors must appropriately balance core values and strategic goals with risk management processes.
The strategic obstacles and challenges that organizations face in the era of big data frankly may be overwhelming to the Board of Directors. According to a survey by Amrop (2016) that mapped the digital competencies of 300 boards and profiles of 3,342 board members, only “5% of board members in non-tech companies have digital competencies” and only “Forty-three percent of board members in technology companies have digital competencies.” Furthermore, the Amrop (2016) study found that only “3% of Boards have a Technology Committee.” PwC’s (2018) Annual Corporate Director Survey shared the views of 714 directors with 76% of respondents representing companies of annual revenues of more than $1 billion and found that there is an information governance disconnect in boardrooms.
Board of Directors can treat information as a valuable, provide effective Business Intelligence (BI) governance to align BI strategy with business objectives, and implement a comprehensive BI governance framework. Given that the boardroom represents the highest level of decision-making in a company, better understanding the BI capabilities available to provide transparency for boardroom strategic decision-making and risk management is essential.
What Business Intelligence tools have you found most valuable in the boardroom? Please leave your thoughts in the comments or message me privately.
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