“There is a larger story behind all the talk about big data and digital transformation, and that story is an economic one: It’s the rise of data capital,” Oracle’s Paul Sonderegger told CMO.
“Data is kind of capital, on par with financial capital, for creating new digital products and services. Unlike the metaphors we use about data - that it’s the new oil, gold or new electricity – what we’re saying with data capital is that it fulfils the literal textbook definition of capital. It is a produced good, as opposed to a natural resource, and it’s a necessary input into other goods or services.
“It’s the same as a retailer who wants to go into a new region but lacks the financial capital to do it and can’t go. By the same token, if that retailer wants to create a new pricing algorithm, basket analysis algorithm or recommendations engine and lacks the data to feed it, they can’t do it.”
Sonderegger was in town to keynote the Big Data and Customer Experience World Show in Sydney, and caught up with CMO to discuss the idea of big data as capital, who he thinks should be the chief data officer, and what it takes to win customers in a world where digital platforms are the competitive battlefield.
Hasn’t data always been a form of capital, by your definition?
There has always been this idea that data is a useful record of what happened, and that you can use that record to make the process that produced it more efficient. We have been doing that for over 100 years and it goes back to Frederick Taylor and shovelling coal at Bethlehem Steel [the Principles of Scientific Management]. That whole push towards standardisation and productivity in the beginning of the 20th century was tied up with capturing information. That data was then used to make that specific process more efficient.