MIS4596 CAPSTONE COURSE

6 Ways to Measure the Value of Your Information Assets

measure information

Last week we talked about how everything is measurable and it is necessary for organizations to measure the value of IT so that the entire organization sees the importance of IT. This author of this article speaks with Doug Laney, research vice president for Gartner Inc., who says there is a gap between the realized and potential value of information. Laney gives his six models for how businesses can treat data as an asset in order to help close that gap.

Non-financial Methods

1. Intrinsic value of information – breaks data into characteristics such as accuracy, accessibility, completeness, then rates each characteristic and tallies for final score.

2. Business value of information – measures data characteristics in relation to business processes.

3. Performance value of information – measures data impact on key performance indicators over time.

Financial Methods

4. Cost value of information – measures the cost of “acquiring or replacing lost information” as well as lost revenue caused by loss of data

5. Economic value of information – measures how data contributes to revenue

6. Market value of information – measures the revenue generated by “selling, renting or bartering” corporate data.

 

Do you agree with the methods Laney suggests? Are their other ways you would measure the value of data? Which methods do you think would be most effective at convincing your CEO that data is an asset to your company?

One Response to 6 Ways to Measure the Value of Your Information Assets

  • I agree that these are all great ways of expressing the value of data to a CEO. I think that the non-financial measures will be harder to communicate, however. In IT we tend to understand the value of data and what would happen without it better than other areas of the business. Trying to communicate the intrinsic value or business value, however, is difficult if the person does not already know that data is important. I think that the cost value and market value will be much better because you can show some hard numbers as to why data is important. I think the most effective measure that Laney states is the Economic value of information. This is a hard thing to measure but trying the data directly to the company’s bottom line will be very persuasive.

Leave a Reply to Amanda M Rossetti Cancel reply

Your email address will not be published. Required fields are marked *

Subscribe to class via Email

Enter your email address to subscribe to this class and receive notifications of new posts by email.

Join 23 other subscribers