I am working on a presentation that will be shared at our IT Symposium 2016 with a colleague of mine, Kristian Steenstrup. The title of the presentation is “CIO: Acting Treasurer of your Company’s Information Assets”. The idea of the presentation came to me as was trying to develop material related to how forms allocate fund for investment (in IT).
I was looking for some material and courses in financial management and budgeting and I came across an association of treasurers. From here I researched the role of treasurer (compared to the CFO) and this identified for me the work and scope of what treasurers so. This made logical sense to me and seemed analogous to what Chief Data Officers and CIOs seek to do with their firms’ information assets.
This morning I was reading my copy of the US print edition of the Financial Times and I spied a Comment titled, “The Bizarre World of Negative Rates” that explored the strange conditions our financial community find themselves in. Almost half the volume of western sovereign and corporate debt (about $12.6tn) have a negative yield: they will lose money when redeemed.
I can’t here wax lyrically about the failings and fallacies of negative interest rates (that is not fitting for an IT blog) but one part of the article caught my eye. It seems that as a by-product of negative interest rates, corporate treasurers are increasing their portfolio holding share of cash. I then related this to business and information: why do firms gather data, since data is cash too?
There have been a growth in acquisitions of data companies, sometimes this comes with technology but there is clearly a strategy to secure the information asset. In all cases these are examples of firms securing access to data on the premise that owning the data secures future profits from that data and processing thereof:
- IHS and Markit Broker a Merger: External Data Becoming Easier to Find
- IBM storms inormation, IOT markets by Buying the Weather Company
So if treasurers are increasing their cash holding so maybe CIOs and CDOs should too? Perhaps the focus on data lakes, and ever larger data lakes, and data brokers and data acquisition is a simile to what treasurers are doing with their real cash?
For treasurers there is risk in hoarding cash: interest rates might, one day, return to normal and market distortions might abate. Currency exchanges might fluctuate and alter the value of the cash being held. There is an analogy here for CIOs and CDOs: there is risk in holding data that is not managed effectively:
- Ethical risks in not knowing what you should know by holding certain data
- Legal risks for holding what you shouldn’t
- Financial risk from the opportunity cost of doing something else with the data rather than just holding it, ‘just in case’
Anyway I thought the article and analogy interesting. The presentation we are working on will only be presented at our Gold Cost Australian IT symposium. The material was not selected for the US or other locations. I guess the Aussies are more financially minded? Worse for me, I won’t be at Gold Coast but my friend, colleague and coauthor of the deck, Kristian, will be there.
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