Good Data Governance is often the difference between an organization’s success and failure. And from a digital transformation standpoint, many view technologies like AI, robotics, and big data as being critical for helping companies and their boards to respond to events quicker than ever. However, the fact is that a digital approach completely changes and expands what you can do. It goes well beyond simply allowing organizations to speed up the same things.

Ethics is one such area that can benefit significantly, and a topic of increasing critical importance for boards around the world. A report from Lloyd’s and KPMG revealed that reputation and other intangible assets are behind over 80% of an organization’s S&P value. What’s more, research has shown that 83% of millennials prefer to buy brands that match their own values. With these realities in mind, it’s clear why it’s so important for organizations to ensure that their leaders are embodying ethical qualities like honesty and fairness – as well as trustworthiness, integrity, and respect, at all times. The key is to set the stage for a culture that guides employees, managers, and leaders alike in engaging in ethical actions that lead to competitive advantage.

Ethics for a Digital Age

What specific types of ethical principles support digital transformation? A major consideration in this regard is that companies must take pains to leverage data responsibly, always avoiding any strategies that could be experienced as intrusive, disrespectful, or manipulative to customers. One way to do this is to remain transparent about their methods behind data collection, use, and monetization, as well as when evaluating how an organization manages consent when customers receive access to digital services. 

Studies have also shown that more and more consumers don’t trust what organizations are doing when it comes to managing, using, and protecting their sensitive data. This has caused matters relating to informed consent to become more important. 

Another critical consideration is that companies will need strong processes in place for governance and auditing, to help identify and address issues such as algorithmic bias. As firms and organizations become ever-more dependent on machine learning algorithms, IT teams must be on the lookout for hidden biases when developing and using digital services that could hurt individuals or damage the organization.

Data Governance Comes First

We all have become too familiar with some of the risks and challenges of digital transformation, from cyberattacks to shortfalls from third-party vendors when it comes to data privacy standards, to take just two examples. This is why companies and leadership teams must place a high premium on the governance that supports any digital transformation effort, making sure that it becomes a key component of the digitalization strategy rather than an after-the-fact add-on.

Consider the following four questions regarding Data Governance that business leaders should keep front and center from the beginning of any digital change effort:

• What will we use for controls for this process?
• How will we monitor our digitalization strategy?
• What will we use to measure success? 
• How will we identify problems to this process?

Addressing the Top Data Governance Challenges

It isn’t always easy to reach buy-in across the board of decision-makers to support a digitalization strategy in the first place. It should thus be no surprise that governance of the selected strategy can become just as challenging. Among the issues to thoroughly think through are assigning owners who are designated with transparent accountability for each step of the change process. It’s just as vital to put the proper systems in place to help the organization harness and understand governance data.

Data Governance should also incorporate connections between processes in not only data security but user experience and supply chains. And, of course, companies will also need to check that their chosen governance models truly support a move toward digitalization, not hamper it, and that appropriate technologies are used.

The ultimate goal of digitalization of governance processes is risk reduction of failed regulatory compliance or legislative breaches. When making such a comprehensive transformation, companies should also put methods in place to measure and continuously monitor performance when it comes to matters of environmental and corporate social responsibility.

Tomorrow’s Roadmap 

The approach an organization takes around governing its digital transformation can make or break whether its digitalization goals are achieved. Data Governance and reporting are key to such a wide range of corporate issues – from pursuing sustainability in climate and stakeholder concerns, to how firms align their business models to broader societal values – that their value is indisputable. The bottom line is to do what it takes internally to produce the needed accountability and transparency necessary to facilitate a successful digital transformation effort.