Successful companies need to be able to use technology to navigate rapid change, whether it’s pivoting during a crisis, experimenting with new business models, or developing new digital offerings for customers.
These abilities hinge on data, according to a new research briefing from Barbara Wixom and Cynthia Beath of the MIT Center for Information Systems Research. Specifically, companies need liquid data assets: cohesive sets of data that are accurate, available, combinable, relevant, secure, and readily usable for future value creation.
Companies should focus on data that has the most potential to create value, the researchers write. The data must be broadly relevant — able to be exploited many times and in many ways — and strategically important, meaning it is able to be used in ways that matter a great deal to the company.
Liquid data assets should be able to be reused and recombined at lost cost and with low effort, according to the researchers. They help companies become more dynamic in three ways:
1. Sensing new business opportunities. Companies can use data to identify how well they are serving customer needs and where they might be falling short. Unmet needs might indicate data shortcomings, and companies can add to, or improve, those assets to fill the gaps.
2. Seizing new business opportunities. Companies can also use data to serve new markets in new ways. And vice versa is true, as well: to seize new opportunities, companies have to improve their data assets with new or more data.
3. Transforming organizational structures and resources. Companies must revamp their data assets often as part of making structural and resource adjustments. For example, automated data management practices can enable organizations to continuously refresh data assets and increase liquidity.
Companies must constantly ask how data assets need to change, according to the researchers, including looking at what attributes are missing and what information should be added to existing data sets.
“A company becomes dynamic when its data-savvy people continuously find ways not only to exploit the company’s data assets but also to improve them,” the researchers write. “Liquid data assets are not static organizational resources; they need to be renewed constantly to maintain relevance in an ever-changing world. Data assets that meet your needs today will not naturally do so in the future.”