We need to talk about how to value organisations' data assets

EVER wondered what data assets are worth? Today, organisations appreciate how data is a key asset for realising the ambition of unlocking new value, new revenue streams, and new opportunities in the unfolding digital reality. Tech giants such as Google, Facebook, Amazon, and others, productise and monetise the enormous hordes of data collected from users across their platforms. Most prominent, and at times most controversial, is the data-related value from advertisement selling.

What is the contribution of data to the value of a company? Currently, it may only be possible to estimate a return on investment a-posteriori to data acquisition and investment. There is value in this approach. However, as a firm's management trying to maximise shareholder value, or external investors assessing whether to buy, build or invest in an asset, or even as a nation's government operating amid the international data flow, we may benefit from having an a-priori estimate of data assets' value.

Presently, data assets are valued using traditional methodologies used in the evaluation of other tangible assets. These methodologies, by virtue of their design, pose certain challenges when applied to data assets. Specifically, they yield an incomplete estimate of the value of data assets by ignoring the fact that no two data assets are the same, and fail to account for the possibility that a data asset may have certain features not found in other intangible assets.