Why should we care about the Data Strategy of an Organization?

To answer this important question, I will take one piece at a time.

First, I would like to ask why should we care about Data? There might be several ways to answer that question. In my opinion, I like the following path. Data is what has been behind the continuous exponential growth of the global GDP in the last decades. GDP growth was flat in real terms until the industrial revolution that happened around 1840 and led to an incredible rate of growth that continued over the decades to follow. The second big wave for incredible growth was around the year 2,000 when the information revolution kept the fast pace, and this has been fueled by Data primarily.

Everyone knows that today the most valued companies in the world: Google, Apple, Facebook, Amazon and Microsoft (GAFAM1) are data companies which as of today have a combined market cap of over 5 trillion dollars. Keep in mind that Japan has a GDP of 5trillion dollars only surpassed by the US and China with 20.5 and 131.4 trillion dollars respectively.

Even in The Economist front page of May 2017 it was depicted with a great title.

It is important to notice that beyond the differences in industries and business models, what united GAFAM is that they can gather enormous amounts of data and use it as business advantages towards creating super valuable organizations.

Now, it is time to focus on why we should care about strategy. To make it simply I think it is because of the following items:

· Status quo: the default is to be where you are, if you don’t evolve you die. To change the current situation, you have to define a sound strategy.

· Long term business goals: it is expected that an organization will have goals that are ambitious, and they are ahead in the road. The strategy will help to not lose that north.

· Scarce resources: no organization will have the ability to have infinite resources in any dimension. In order to prioritize those resources, you must develop a strategy.

· Handle uncertainty: There are lots of known-unknowns and definitely more unknowns-unknowns in order to cope with that in a controlled way a strategy will come handy.

So, I have described why one should care about Data and Strategy separately. However, as in many experiences the mantra: “The whole is greater than the sum of its parts”22 applies also in this case where the “Data Strategy” thought as a whole and taken holistically for the organization is much greater than “Data” + “Strategy”.

To summarize the main aspects to take into account when developing a Data Strategy, I have developed the following Data Strategy Manifesto:

1 The order of the most valued companies as of June 22nd, 2020 is the following: 1st Apple ($ 1.555T), 2nd Microsoft ($1.521T), 3rd Amazon ($1.354T), 4th Alphabet ($0.989T), and 5th Facebook ($0.682T). I used Google to refer to Alphabet and the order Google, Apple, Facebook, Amazon and Microsoft because the acronym GAFAM sounded better in my opinion than AMAAF. 2 The phrase “The whole is greater than the sum of its parts” is attributed to Aristotle however there is some people that argue that it was not a correct interpretation of what Aristotle wrote in Metaphysics. I leave it there because to align those disagreements is not the purpose of this article.