All data which organisations process on a daily basis, be it structured or unstructured, plays a major role in enabling an effective risk management process.
It is therefore vital that data be of good quality and high integrity, in order that it may produce the desired results. For this to be possible, the data should to be created with ‘the end in mind.’ In other words, organisations need to ask questions such as:
- How we will use the data, that is, what reports do we need to generate that feed our Governance structure?
- How will it enable sound, well informed decision making, and assist in enabling a robust Governance structure?
- What is the value of such information? that is, how will this information enhance our performance and create value for our stakeholders?
It is obvious that our ‘end in mind’ in this respect is the proper management of data which feeds and enables an effective risk management process. We need to focus the entire organisation on the achievement of our objectives with the clear understanding that the main way of getting there is through managing our data, and ensuring its quality as well as integrity. Structured data is usually more defined in that it is processed through algorithms that would have been set up in traditional well defined data analysis tools.
It becomes necessary therefore that we establish processes and systems to manage unstructured data, since data experts estimate a high percentage, as much as 80 to 90 percent in some instances, in any organisation is unstructured. Data is structured if at the gathering stage the questions like those posed in paragraph 2 of this article are answered objectively, and understood by key stakeholders. Risk specialists and champions could play a major role in getting everyone on board with a structure/taxonomy that would guide the process and ensure that the correct information is collated. But what would further assist, is the implementation of data analytics software that will speak directly to these needs. The underlying premise is that unstructured data has no pre-defined operating model and therefore would require a tool to gather, analyse, and produce reports.
An important question becomes, are organisations ready to deal with and finance solutions to any constraints that may be uncovered in the process of ‘cleaning up’ their data sets in the name of sound risk management?
