'Data governance' may seem like a nebulous concept for many small businesses – since when do we have time to govern anything except our business? But it’s actually an important practice for any small business owner and it’s easier to grasp than you think.
Our Xero Responsible Date Use Advisory Council defines data governance as “the planning, oversight and control over management of data and data-related sources” and further highlights it as “an important factor in an organization’s ability to derive value from data in a responsible, ethical way".
So, what can a busy small business owner do to ensure they are instituting proper data governance? As a busy small business owner myself, I sympathise with the plight of my fellow entrepreneurs. I’ve compiled the following four key considerations when it comes to ethical data governance.
- Address data governance now, save time later. In an ideal world, you’ll want to start implementing data governance as soon as you start gathering any customer data. For my business, we started thinking about it when General Data Protection Regulation (GDPR) rules came out. It’s best to get a head start on it, because it’s harder to sift through data retroactively and you’ll incur more costs down the line if you wait. Having said that, keep in mind that it's never too late to begin.
- Don’t make it more complex than it is. Most of the time, small business owners think they have no time or budget to handle data governance or that it’s just too complicated. But that’s just overthinking it. Start by laying out what data you have and how you are gathering it. Once you spend time looking at it, it’s pretty straightforward. And trust your gut instinct. Generally, if it feels wrong, you might want to take another look at the way you are using your customers’ data. So make sure to review your messages often.
- Leverage the tools at your disposal. There are various tools at your disposal for effective data governance without incurring a large investment. For example, when it comes to marketing, make sure you select tools that allow you to use automated best practices for customers to easily unsubscribe or update marketing preferences, including push notifications. This is important so that customers aren’t contacted against their will. Most marketing tools should have some level of automated data governance. Using them effectively will ensure your customers are happy with how you’re storing their data.
- Continually revisit data governance in your budget. At my company, data governance is an essential part of our marketing budget, and it should be the same for most small businesses. As your business grows, you may want to consider parsing out your data governance work to a trusted third party. But no matter where you are on your data journey, you should always stay vigilant on how you are addressing data governance. We recently got an email from a customer asking us where we are in our GDPR processes. Thankfully, we have a fairly good grasp on our data governance, so we were able to answer this to the customer’s satisfaction. But imagine if you’re not prepared to respond. You don’t want to put your customer relationships at risk.
People tend to get angry – and rightfully so – if you use their data in a way they don’t want you to. So there is a direct business implication to executing proper data governance. To my fellow SMB owners: make sure you are balancing between ethical data considerations and your business growth. Doing so early on could be a major difference maker down the line.