 From Cambridge, Massachusetts, it's the Cube, covering MIT Chief Data Officer and Information Quality Symposium 2019, brought to you by SiliconANGLE Media. Hi everybody, we're back in Cambridge, Massachusetts at the MIT Chief Data Officer Information Quality Event, hashtag MITCDOIQ, and I'm Dave Vellante, he's Paul Gillan, day one of our two-day coverage of this event. This is the Cube, the leader in live tech coverage. Joe Caserta is here, he's the president of Caserta, and Doug Laney, who is principal data strategist at Caserta. Both Cube alum guys, great to see you again. Good to see you again. Joe, when did you pick up this guy? How did that all happen? Doug, you came on here a couple of years ago, we had a great conversation, read the book, loved it, so congratulations, a nice pick up. We're very fortunate to have him. Thanks. I'm fortunate to be here. So okay, well what attracted you to Caserta? Well, Joe's got a tremendous reputation. His team of consultants has a great reputation. We both felt there was an opportunity to build some data strategy competency on top of that and leverage some of those infonomics ideas that I've been working on over the years. Yeah, great, well congratulations. And so, Joe, you and I have talked many times, and the reason I like talking to you is because you know what's going on in the marketplace. You could, you know, siphon what's real, what's hype. So what do you see as the big trends in this data space? And then we'll get into it. Yeah, sure. The trends are, the chief data officer, right, has been evolving over the last couple of years. You know, when we started doing this several years ago, there was just a handful of people, maybe 30, 40 people. Now there's 450 people here today. And it's been evolving. People are still trying to find their feet exactly what the chief data officer should be doing, where they are in the hierarchy, should they report to the CEO, the CIO, the other CDO, which is a digital officer. So I think, you know, hierarchically they're still figuring it out, politically they're figuring it out, but technically also they're still trying to figure it out. You know, what's been happening over the past few years is the evolution of data going from traditional data warehousing and business intelligence to get insight out of data, just isn't working anymore. So evolving that, moving it forward to more modern data engineering, what we've been doing for the past couple of years with quote unquote big data. And that's not working anymore either, right, because it's been evolving so fast. So now we're on like maybe data 3.0 and now we're talking about just pure, automate everything. We have to automate everything. And we have to change our mindset from having output of a data solution to an outcome to a data solution. And that's why I hired Doug, because we have to figure out like, not only how to like get this data and look at it and analyze, but really how to monetize it, right? It's becoming a revenue stream for your business if you're doing it right. And Doug is the leader in the industry on how to figure that out. Well, you know, keep premise of your book was you got to start valuing data and it's fundamental and you put forth the number of approaches and techniques and examples of companies doing that. Since you've published in Phonomix, Microsoft, Apple, Amazon, Google and Facebook are the top five market value companies. They've surpassed all the financial services guys, all the Exxon mobiles and any manufacturer, automobile makers, and what are they? They're data companies. Right, absolutely 100%. But intrinsically we know there's value there, and any closer to the prescription that you put forth in the book? Yeah, it's really no surprise and actually we found that data companies have a market to book value, that's nearly three times the market average. So Apple and others are much higher than that, but on average, if you look at the data product companies, they're valued much higher than other companies. Probably because data can be reused in multiple ways. So that's one of the core tenets of Infonomix is that data is this non-depletable, regenerative reusable asset. And that companies that get that and architect their businesses based on those economics of information can really perform well. And not just data companies, but any company. I mean that was a key takeaway of the book is that data doesn't conform to the laws of scarcity. Everybody says data is the new oil, it's like no, it's not. It's more valuable. So what are some examples? I mean, in writing your book and customers that you work with, where do you see companies outside of these big data driven firms breaking new ground in uses of data? Do you want to check? I think the biggest opportunity is really not with the big giant companies. It's really with the small, most of our most valuable clients are small companies with large volumes of data. And the reason why they can remain small companies with large volumes of data is the thing that holds back the big giant enterprises is they have so much technical debt. It's very hard. They're like trying to race a Titanic, right? You can't really, it's not agile enough. You need something that's small and agile in order to pivot because it is changing so fast. Every time there's a solution created, it's obsolete and we have to create a new solution. And when you have big old processes, big old technologies, big old mindsets and big old cultures, it's very hard to be agile. So is there no hope? I mean the reason I asked the question was what hope can you give some of these smoke stack companies that they can become data centric? Yeah, one of the things you see is that there was a move to build big monolithic data warehouses years ago and even data lakes. And what we find is that looking through the wealth of examples of companies that have benefited in significant ways from data and analytics, most of those solutions are very vocational. They're very functionally specific. They're not enterprise class, yada yada kind of projects. They're focused on a particular business problem or monetizing or leveraging data in a very specific way. And they're generating millions of dollars of value but again, they tend to be very functionally specific. The other trend that we're seeing is also that the technology and the end result of what you're doing with your data is one thing. But really in order to make that shift if you're a big enterprise is culture. To really change all of the people within the organization to migrate from being a conventionally wisdom run company to be a data real analytics driven company. And that takes a lot of change management, a lot of what we call data therapy. We actually launched a new practice within the organization that Doug is actually and I are collaborating on to really mature because that is the next wave is really, we figured out the data part, we figured out the technology part but now it's the people part. The people part is really why we're not way ahead of where we, even though we're way ahead of where we were a couple of years ago, we should be even further. But culturally it's very, very challenging and we need to address that head on and that's next. Is that a skills issue that they're sort of locked in to their existing skill sets and processes or is it? It's fear of the unknown, right? What we're doing, you know. What about FOMO? Yeah, exactly. I mean, there are people chomping at the bit to do this, right? So there is that part and an exciting part of it but there's also just fear and fear of the unknown and part of what we're trying to do and why we're trying to push Doug's book not for sales but really just to share the knowledge and remove the mystery and let people see what they can actually do with this data. Yeah, and it's more than just data literacy. So there's a lot of talk in the industry about data literacy programs and educating business people on the data and educating data people on the business and that's obviously important but what Joe's talking about is something bigger than that. It's really cultural and it's something that is a change to the company's DNA. So where do you attack that prop? Does it have to go from the top down? Do you go in through the middle? It has to be from the top down. It has to be. It has to be because my boss said to do it, right? Yeah, otherwise they might do it but the organization's not going to do it. Because if you do it as a grassroots movement only the folks who are excited, right? The FOMO people, right? They're the ones who are going to be excited but they're going to evolve and adopt anyways, right? But it's the rest of the organization and that needs to be a top down approach. You know, it was interesting hearing this morning's keynote speakers. He's going to throw a top down under the bus but I had the same reaction as you can't do it without that executive, you know, buying in and of course we defined I guess in the session what that was. Amazon has an interesting concept for any initiative. Like every initiative that's funded has to have what they call a threaded leader. In other words, some kind of, and if they don't have a threaded leader there's like an incentive system to dime on the initiative and kill it, right? So it kind of forces top down, you know, buying. So when we interview our clients we have a litmus test and the litmus, it's kind of a readiness test. Do you have the executive leadership to actually make this project successful? And in a lot of cases they don't and you know, we'll have to say we'll call us when you're ready. You know, or because one of the challenges another part of the litmus test is this IT driven. If it's IT driven it's going to be very tough to get embraced by the rest of the business. So we need to really be able to have that executive leadership from the business to say this is something that we need to do to survive. Yeah, and you know, without the top down support you could play small ball, but if you're playing the Yankees you're not going to win. And one of the reasons why when it's IT driven it's very challenging is because the people part, right, is a different budget from the IT budget. And when we start talking about data therapy, right, and human resources and training and education of just culture and data literacy, which is not necessarily technical, that becomes a challenge internally on figuring out like how to pay for it and how to get it done with the corporate politics. So the CDO crowd, I mean, definitely parts of your book that they should be adopting because to me their main job is okay, how does data support the monetization of my organization, whether it's raising revenue, cutting costs, improving productivity, saving lives, it'll call it value. And so that seems to be the starting point. At the same time in this conference, grew out of the ashes of the back room, information quality, the big data hype that exploded and it kind of gone full circle. So, but I wonder, I mean, is the CDO crowd still focused on that monetization? Certainly, I think we all agree they should be, but are they getting sucked back into a governance role? Or can they do both, I guess is my question. Well, governance has been a big issue the past few years with all the new compliance regulations and a focus on ensuring compliance with them. But there's often just a pendulum swing back and I think there's a swing back to adding business value. And so we're seeing a lot of opportunities to help companies monetize their data broadly in a variety of ways, as you mentioned, not just in one way. And again, those do need to be driven from the top. We have a process that we go through to generate ideas and that's wonderful, generating ideas is fairly straightforward enough. But then running them through kind of a feasibility assessment, starting with you have the executive support for that, is it technologically feasible, managerially feasible, ethically feasible and so forth. So we kind of run them through that next. One of my concerns is that, you know, Chief Data Officer, the level of involvement that she or he has in these digital initiatives. And again, is the digital initiative a field of dreams? Maybe it is, but everywhere you go, the CEO is trying to get digital right. And it seems like the Chief Data Officer is not necessarily front and center in those, certainly AI projects, which are skunkworks, but it's the Chief Digital Officer that's driving it. So how do you see those roles play out? In the last panel that I just spoke in, very similar question was asked. And again, we're trying to figure out the hierarchy of where the CDO should live in an organization. I find that the biggest place it fails typically is if it rolls up to a CIO, right? If you think that data is a technical issue, you're wrong, right? Data is a business issue. And I also think for any company to survive today, they have to have a digital presence. And so digital presence is so tightly coupled to data that I find the best successes when the Chief Data Officer reports directly to the Chief Digital Officer. Chief Digital Officer has a vision for the user experience, for the customer, the customer Zella to figure out, how do I get that customer engaged? And that directly is dependent on insight, right? On analytics, right? You know, if the four of us were to open up any application on our phone, even for the same product, we would have four different experiences based on who we are, who our peers are, what we've bought in the past. That's all based on analytics. So the business application of a digital presence is tightly coupled to analytics, which is driven by the Chief Data Officer. That's the first time I've heard that. And I think that's the right organizational structure. I think the Dig, C-Dig is going to be sort of the driver of the strategy. That's where the budget's going to go. And the Chief Data Officer's going to have that supporting role, which is vital. The enabler. Yeah, right. I think the Chief Data Officer is a long-term play. Will we have a lot of Chief Data Officers still 10 years from now, or is this going to be a business? I think data is not a fad. I think data is just to become more and more important. And will they ultimately leapfrog the Chief Digital Officer and report to the CEO maybe someday? But for now, I think that's where they belong. Yeah. You know, once companies started managing their labor and workforces as an actual asset, even though it's not a balance sheet asset for obvious reasons, in the 1960s, that gave rise to the Chief Human Resource Officer, which we still see today. And as companies start to recognize information as an asset, you need an executive leader to oversee and be responsible for that asset. I mean, conceptually, it's always been data as an asset and a liability, and you know, we've always thought about it in balance terms. Your book sort of put forth a formula for actually formalizing that. That's right. Yeah. Do you think it's going to happen in our lifetime? What exactly? My chips are on it. What you put forth in your book in terms of organizations actually valuing data specifically on the balance sheet. So that's an accounting question, and one that you would leave to the accounting professionals, but there have been discussion papers published by the accounting standards bodies to discuss that issue. We're probably at least 10 years away, but I think irrespective of whether data is a balance sheet asset or not, it's an imperative for organizations to behave as if it is one. And that was your point. It's probably not going to happen, but you got to think in terms that you can understand the value because that's- It comes back to you can't manage what you don't measure. And if you're not measuring the value or potential value or quality of your information or what data you have, you're in a poor position to manage it like one. And if you're not managing it like an asset, then you're really not probably able to leverage it like one. All right, give us a little commercial for Cassetta. Well, I do want to say that I do think in our lifetime, we will see it become an asset. There are lots of intangible assets that are on the books, intellectual property, contracts. I think data that supports both of those things are equally as important and they will see the light. Yeah, why are those five companies such a huge market cap winners where they've surpassed all the- It's evaluation of a business. The data that they have is considered, right? So it should be part of the assets in the books. All right, we've got a wrap. But give us the Cassetta commercial. Well, Cassetta is a consultancy that does essentially three things. We do data advisory work, which Doug is heading up. We do data architecture and strategy. And we also do just implementation of solutions. Everything from data engineering, data architecture and data science. Well, you made a good bet on data, Joe and Doug. Doug, thanks for coming on you guys. Great to see you again. Thanks guys. Thank you for watching. That's a wrap on day one. Paul and I will be back tomorrow for day two at the MIT CDO IQ. Thanks for watching. We'll see you tomorrow.