The Value of Used Data

Motivated by a comment from Larry Dubov on the Data Quality ROI page on this blog I looked up the term Information Economics on Wikipedia.

When discussing information quality a frequent subject is if we can compare quality in manufacturing (and the related methodology) with information and data quality. The predominant argument against this comparison is that raw data can be reused multiple times while raw materials can’t.

Information Economics circles around that difference as well.

The value of data is very much dependent on how the data is being used and in many cases the value increases with the times the data is being used.

Data quality will probably increase with multiple uses as the accuracy and timeliness is probed with each use, a new conformity requirement may be discovered and the completeness may be expanded.

The usefulness of data (as information) may also be increased by each new use as new relations to other pieces of data are recorded.

In my eyes the value of (used) data is very much relying on how well you are able to capture the feedback from how data is used in business processes. This is actually the same approach as in continuous quality improvement (Kaizen) in manufacturing, only here the improvement is only good for the next goods to be produced. In data management we have the chance to improve the quality and value of already used data.    

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5 thoughts on “The Value of Used Data

  1. Loretta Mahon Smith 18th April 2011 / 22:08

    There are two resources/reference that may be of use in trying to determine value as you describe it.

    First, look at “The Long Tail” by Chris Anderson and read the section about how iTunes makes serious profits on it’s longest held inventory of songs. A great example of finding the point where carying cost of data inventory is so low that almost the entire re-use/repurpose/resale is complete profit.

    Second, consider reading “How to Measure Anything” by Douglas Hubbard. He really shows that even the most intangible of constructs can be measured with clear, concise concrete metrics!

    • Henrik Liliendahl Sørensen 19th April 2011 / 06:32

      Loretta, thanks a lot for sharing these useful references.

  2. Larry Dubov 26th April 2011 / 21:00

    I can’t agree more about the usefulness of data. Fortnunately my focus is on master data. Its usefulness is self-evident if master data is properly defined.

  3. Ian Stahl 4th May 2011 / 18:22

    Hello Henrich. Thanks for this post. It’s timely for me because in my day job (as a humble product marketer for a software company) I confront this simple question all the time: how does an organization value a piece of data management infrastructure, like an MDM platform? Typically, value is inferred from an ROI garnered from various process improvements resulting from better data quality, but that’s a pretty attenuated value chain, I admit. If we could assess value according to internal characteristics of the data, like usage, quality or consistency, it would certainly be easier to quantify.

    If you’ll recall, we’d discussed this a couple months ago… maybe time to revisit this subject. Thanks! – Ian.

  4. Henrik Liliendahl Sørensen 12th May 2011 / 14:49

    Thanks Larry and Ian for commenting – and sorry Ian for an 8 day moderation time; your comment was for unknown reasons hiding in the spam folder among all the Russian ad’s and SEO dirty tricks.

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