Page 11 - Finanancial Management_Feb_Apr23

LEARNING RESOURCES

Dylan to Bruce Springsteen cash in on the future value of their
music rights. When this model is applied to data, an organisation
Making the Case for Data Analytics can still own the data but sell the rights to future revenue streams
derived from the data in return for payment today. Data becomes
Learn the foundations of data analytics a more tangible asset with a fair market value that can be
and how it can transform an organisation securitised, traded, or borrowed against. Valuing data is becoming
and close data analytics skills gaps for increasingly practical as marketplaces emerge that establish a
future success.
price for data that is categorised and packaged. Revenue streams
Find this course in the AICPA Store and in from subscriptions, licensing, and royalties provide the inputs to
the CGMA Store. a model for forecasting the future value of data.

COURSE BUNDLE The process of creating value from data is analogous to that of
extracting value from natural resources. Raw data can be
processed or refined to create products of differing value. This can
Getting Started with Data Analytics involve subjecting data to aggregation, concatenation,
categorisation, extrapolation, and analysis.
Learn how you can conduct data analytics For example, sales data could be grouped by product or
projects in your organisation. Learning geography to create a product. This could be sold or subjected
outcomes include recognising how data to further processing to create another product. The product
analytics can be used to achieve a and geographic sales data could, for example, be combined
competitive advantage and create
opportunities for innovation. with weather data to show how sales vary under different
weather conditions. Much like the refining of crude oil, where
Find this course in the AICPA Store and in the products can be created at each stage of the process, data is a
CGMA Store. resource that can be refined into multiple products, each of
COURSE BUNDLE which has economic value to someone. And both oil and data
are benefiting from technology advances that have dramatically
improved the efficiency of exploration, extraction, refining,
Cybersecurity and Digital and use.
Transformation
Types of data value
The course lays out market trends in digital From a CFO’s perspective there are three primary sources of value:
transformation and their impact on
cybersecurity.
Transactional
Find this course in the AICPA Store and in the Data can be used to initiate and process transactions. Examples
CGMA Store. include execution based upon a set of predefined criteria being

COURSE met; inventory replenishment triggered by usage, events, or
algorithms; or validating transactions based upon the existence of
required metadata such as customer identifiers. Selling access to
large streams of transaction data can allow others to derive
CFOs have long understood the potential value of data and intelligence and insight that can guide innovation, research,
have always played a key role in data stewardship. Over time this financing, and product development.
role has expanded to embrace both market and operational data
as well as financial data. Today, many companies share Informational
anonymised data for little or no value to other organisations that Data can be aggregated and concatenated to provide information
then profit from it. Retailers provide sales data to aggregators that about a series of events or transactions such as measuring activity
then sell the data to consumer products companies and levels, comparing to different bases (eg, prior periods, plans,
marketers. Physicians and hospitals give up medical data that is targets, or statistical value and trends), or evaluating past actions
resold for research and development purposes, and airlines, or decisions.
insurance companies, banks, and others freely disclose pricing Organisations that accumulate rich data that can be grouped
data on comparison sites in the hope of generating new business. around different attributes can create data products that have
But what if the value of that data could be realised by the value to others. For example, information on traffic flows from
organisation itself? municipal traffic management systems can guide the planning of
infrastructure investments; hospital data on patient outcomes
A new model can help refine insurance coverage and pricing.
A new financial model is emerging that allows organisations to
monetise the current and future value of data. A useful reference Analytic
point is the deal musician David Bowie struck in 1997 to sell a By applying rules, statistical formulas, data science, and AI,
bond backed by his future royalties. In effect, he received cash including machine learning, or other analytical frameworks, data
then in return for giving up his rights to future royalty streams can be interrogated to explain current or past outcomes or predict
from his music. future outcomes and events. Financial institutions can create
This model has exploded in recent years as artists from Bob analytics that track spending behaviour by income level and

10 I FM MAGAZINE I February 2023