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October 2021
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Putting a Value on Public Sector Data

by Richard Walker, Data and Insights Partner, Agilisys

Over the past 12 months we have frequently heard the Prime Minister declare that Government is “following the science”. At the same time, millions of us have found ourselves staring at charts and monitoring trends eager to understand the current situation. The link between the data that government collects and the outcomes it drives has suddenly assumed a place at the forefront of public consciousness. While the concept of data saving lives has perhaps never felt more prescient, it is not only in times of unprecedented uncertainty that the value in public sector data comes to the fore.

Richard Walker

There are pressing questions for the public sector that will continue to challenge even after the threat of the pandemic diminishes. How do we deliver better care for an ageing population with changing needs? How do we predict and prevent threats to public safety? How do we move around the country more efficiently? And, how do we stop the damage we are doing to our environment? Data will help provide the answers.

Providing a return on investment of data 

Budgets are not endless. The difficulty in proving return on data investment is probably the number one reason to get serious about defining and measuring the value in your data, but it is not alone.

1.Not all data is equal 

When choosing which elements of a data strategy to invest in, choices need to be made. These should be informed by the value each initiative will individually or collectively unlock.

The answer for which actions to prioritise should lie in a clear understanding of the route to value. Not all data is equal when it comes to delivering your strategic objectives, you will need to prioritise and be able to defend those decisions to those who would have preferred you start with their area instead.

2.A need for clarity 

Like everyone else, us data folk should be held to account for the investments that are made in improving data itself (collection, curation, quality etc.) or the methods used to extract its value (analytics, digital applications etc.).

Without a baseline of the value in data, how can public sector organisations present a case for the improvements that have been made over time? The answer is they cannot. Therefore, providing a clear need to value their data assets and revisit those valuations over time.

3.Ensuring a fair price 

It may be an uncomfortable concept, but the world’s wealthiest companies are data companies. Make no mistake, the value in public sector data assets to those companies is monumental. It is data they can only approximate from all the other sources they mine.

In a hypothetical scenario whereby a local or regional authority were to look to monetise its data, you would want a fair price, to be assured that value is fully understood, and the best deal negotiated. This will not happen without measuring value.

How can a value be put on public sector data? 

1.Cost Value of Data

Collecting, managing, protecting and storing data all costs money. When you factor in the people and technology elements, it only increases. Working out how much your organisation currently spends looking after data is a good starting point for future negotiations.

Presenting your plan as an incremental investment (often a small percentage) to get better bang for the significant buck already committed, is a technique frequently used by those responsible for other strategic assets. The sell can take many forms, it might be that you will drive process efficiencies or performance improvements elsewhere in the organisation, or that you can identify savings and efficiencies within the current data spend portfolio but need to land an invest to save proposition.

2.Economic Value of Data

The economic value is the difference between costs and benefits. Applying a framework to a data related initiative is often difficult. In commercial settings, it can be achieved through testing e.g. make data available to sales team ‘A’ through a new BI platform but not to sales team ‘B’ — measure the difference in performance and you have a measure of value returned for your investment.

When we do this with government organisations, we tend to look at unit costs as being the most effective scaling factor for the benefits unlocked. I was part of a project a few years ago where the client had an issue with delayed transfers of care from an acute hospital setting into community settings. Neither party in the discharge process had visibility of the other’s data. Acute settings did not know when spaces would become available to discharge patients into, and brokerage teams had no advance view of how many patients with which types of need they were going to need to support.

The intervention was to create a live link between two systems to facilitate the exchange of data; a portal to view it through and engage the respective teams to ensure that relevant data protection principles were considered. The inputs (both data and technological), activities (drafting and reviewing a DPIA, configuring and testing the live link, designing, and building the portal) formed the costs (c£100k). The outputs, e.g., improved patient health outcomes, reduced incidents of delays in transfer of care and improved staff morale were some of the benefits. In total, conservative efforts suggested the trust was able to save £150,000 per month in bed days. This is a powerful example of how investing in a data and insights project effectively could yield real tangible and positive impacts.

3.Opportunity Cost Value of Data

The cost of unrealised value due to the “state” of the data asset can be measured using the opportunity cost of investments already made or outcomes not achieved.

Imagine your organisation has made a £20m investment in a new technology platform. You were persuaded to go for the market leader, reassured that concerns over legacy platforms were nothing the vendor had not seen before and that its solution would fix all of that anyway. Two years in and only 60% of the functionality has been enabled. Your vendor is blaming the state of your data. The state of your data is therefore costing you £8m.

4.Market Value

There are many partnerships being struck right now around innovative new technologies between public and private sectors. Often the public sector provides the data whilst the private sector provides the means to turn it into insight and action. I believe we will see more and more of this type of “joint venture” going forwards and we will very quickly come to think of public sector data as a magnet to pull in private sector investment.

Data is not finite and so the opportunity to repeatedly sweat the same asset through such deals is much greater. Not forgetting legitimate concerns around the ethics of using government data in this way, but there are ways to navigate those and end up at this reality sooner than we think.

However, these approaches are not designed to be mutually exclusive. To go toe-to-toe with other investment priorities, you will probably need as much ammunition as you can muster. It is vital, therefore, that in prepping yourself to cross the final hurdle to secure funding, you do not overlook the power in the human outcomes you plan to drive, be that better care, safer communities, or a cleaner environment.

Marry the two, though, and you should have a winning formula.

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