How is "data" important for a company?

How is data important for a company, business, establishment or any venture that we aim to do. How does it add up to make proper decision and drive the show?

Let me explain this using the ITIL vision chart.

I wrote this note to better explain how IT systems are critical for the company. This is something we all should know as this is core to all IT services. I am taking help of ITIL methodology Vision chart to explain how information interconnects and work at different levels.

As a digital data developer or consumer, we are all playing different roles. Be it hardware or software, we are all focused on using, managing and supporting a single crucial unit - "Data". All our duties are centered around this unit. Data can be in the form of text, video, audio, pictures, documents etc. Data resides in databases, on systems, on storages, travels on network, gets printed, gets reported, gets analyzed, is at threat from malware attacks, we lose sleep on it and we go to work every morning to deal with it. We design and develop code to make it usable and maintain the integrity and confidentiality. All IT profiles will be centered around handling this element and every hardware and software we deploy works on this element. Quite Simple.

Think about what you are doing and analyze it in relation to data, you will have a better understanding of why your job matters. This would apply to all kinds of jobs.

"Data" that is processed, structured and organized becomes "information" - basic stuff we all learnt in early days. What wasn't covered is how is this "important" for running business or whatever we want to achieve.

Old data relates to past performance and history of a company, while fresh data depicts the operational processes currently active. Let us go above data to understand business now.

Information is used to make business decision of course, but more important, it connects with the Vision of the company. Data has a new meaning in the form of Measures, Metrics and KPI as it travels up the hierarchy.

Measure is what data we want to track and capture for our needs. We derive Metrics from measures to analyze the data and judge the performance. Metrics are used by all decision makers to run the show and perform operational decisions. Certain specialized and important metrics are termed Key Performance Indicator (KPI). KPI form the important numbers that managers and decision makers will use to make tactical and strategic decisions, these are required to achieve success for organization.

Lost? The ITIL vision chart explains this with hierarchical dependency..

  -> Mission
    -> Goals
      -> Objectives
        -> CSF
          -> KPI
            -> Metrics
              -> Measures

The layer above KPI is the Critical Success Factor (CSF) that decision makers will work on to see if the provided KPI numbers are as per the expectation and in line with the Objectives aimed towards meeting the final Goals. CSF are also termed as Key Result Areas (KRA), which is often used in relation to resource performance.

The chart when implemented is from top to bottom. Executive Management drive the organization using this strategy and employees contribute in achieving the expected results that are "measured". So bottom line - the data points to the effectiveness in implementing strategy that should achieve the Vision.

Point to note - not all data can be captured and converted to metrics. Not all data is required to be captured and converted to metrics.


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