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Building a Tangible ROIfor Data Quality
Harte-Hanks Trillium Software
www.trilliumsoftware.com
Corporate Headquarters
 + 1 (978) 436-8900trilinfo@trilliumsoftware.com 
 
 
How Do I Create a Data Quality ROI?
Organizations are cost-conscious… nothing new there. Prior to spendingmoney on data quality improvements, whether this be adding staff resources, investing in technology, or changing existing processes or workflow, senior management demands a business case thatdemonstrates the value such efforts will introduce to the organization.Though it is easily assumed that better data will benefit the organization,putting numbers around that benefit often slows the investment downsignificantly.Organizations that have already addressed data quality improvements insome way within their enterprise often face delays in investing further indata quality initiatives because a knowledge gap exists in the actual valueit provides their organization. While many soft benefits can be attributed tobetter data quality, it is also true that organizations with mature dataquality initiatives in place have quantified benefits that have been reflectedon their organizations top and bottom line.You may or may not be required to produce a business case or submitsome sort of cost justification for a data quality initiative. However, byquantifying the impact of data quality processing, in a methodical way, youwill measure the impact of your efforts and the value you are providing toyour organization and will establish a tangible return on investment. Later,this ROI may be useful to drive future investments and further promotion of data quality within your organization.
Data Quality Metrics: The Short Answer 
Unfortunately, there is no short answer to the question, “What data qualitymetrics should I be tracking?” or “Where do I find an ROI for my dataquality efforts?” Each industry, each project, each organization hasdifferent goals, business metrics, and considerations that may impact aresulting return on investment.Fortunately, there is a reasonable
 process
through which a return oninvestment can be defined and tracked. Organizations that havedeveloped ROI practices associated with their data quality initiatives have
 
It is imperative to understand the relationship between data and processes, and the relationship between those processes and financial results.
 
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paved the wave with demonstrable, repeatable results, most of which haveexceeded their initial expectations.The key concept for building a business case or ROI is to understand therelationship between your data and the business process(es) it supports,and then further, the relationship between those processes and businessresults. When you boil it down, there are three primary areas for businessimpact: increasing revenue by growing the business in some way, savingmoney by reducing costs, or reducing risks and meeting regulatory drivencompliance measures..Included at the end of this paper is a list of projects where someorganizations have been able to realize a return on their investments, tohelp generate ideas about where to look within your own organization.
Funding Enterprise Data Quality and Ongoing Governance
Organizations thinking about Master Data Management and DataGovernance strategies already understand the enterprise concerns thataccompany such large initiatives. Data quality efforts likewise, cannotexist within a project vacuum, and must support short-term business goalswhile delivering quick win results in order to provide true value to thebusiness. Thus, most enterprise data quality efforts start out as a singleproject or focused effort within a single application (albeit an enterpriseapplication at times) with the understanding that the solution must growand extend over time to support multiple applications, service orientedarchitectures, multiple processes, and eventually, a culture shift thatpermeates an organization so that data quality concerns are embeddedwithin every new project or systems effort.The first project will feed return on investment which will drive subsequentgrowth. Through harnessing some significant baseline statistics during thefirst project, you create the opportunity to develop a business case with aproven ROI, to use at some point in the future.
Process to Quantify the Impact of Data Quality
 
The key to establishing a quantified ROI for data quality efforts is tounderstand the relationship between data and processes, and therelationship between those processes and financial results. The value of particular data is tied to its application and use in a business environment.
The first project will feed your return on investment which will drive subsequent growth.
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