In a special edition of the Legal Leaders Exchange podcast, we heard from Wolters Kluwer CEO Nancy McKinstry and Barbara Wixom, Principal Research Scientist at the MIT Center for Information Systems Research as they discussed the interesting world of data monetization. As organizations increasingly recognize the value embedded in the data they collect and generate, the conversation provided useful insights into the multifaceted nature of data monetization, the role of advanced capabilities like artificial intelligence (AI), and the crucial elements of trust, leadership, and vision.
Methods for monetizing data
Barbara emphasized that data monetization extends far beyond the conventional concept of selling datasets. Organizations can derive value through a three-pronged approach that Barbara and her colleagues have identified: improve, wrap, and sell.
Improvement through data analytics: A substantial portion of returns from data monetization comes from the aspect of improvement. This involves leveraging data analytics to automate tasks, streamline processes, and enhance overall efficiency. Organizations can use data insights to predict outcomes, inform decisions, and significantly reduce manual effort.
Data wrapping for enhanced experiences: Data wrapping involves enhancing existing products or services by incorporating data-driven features into them. For instance, a banking service could introduce an environmental, social, and governance (ESG) score to help clients understand the impact of their investments. Data can add value in diverse and unexpected ways across many types of software applications and even physical consumer products.
Data sales: The third prong, selling, involves creating entirely new revenue streams to sell data itself as the product. Barbara stressed that selling requires various types of managerial levers, to develop different ways of pricing, measuring, and creating value. Customers often need help understanding the actual cost savings and significance.
Current research and best practices
As the conversation shifted toward advanced capabilities like AI, Nancy sought insights into how these technologies factor into Barbara’s work and the organizations she collaborates with. Barbara pointed to the need for more foundational capabilities and strategies like improvement or upselling before diving into advanced technologies like AI. This is equally true for complicated strategies like data sharing, both between a provider and a customer, and within a large organization, as these efforts require reusing and recombining data assets.
Among Barbara’s colleagues and the organizations they work with, sustainability is currently a very hot topic. Many companies are seeking additional expertise on how to leverage data to improve their own results around sustainability or to help their customers do so.
Trust, leadership, and vision
Trust emerged as a recurring theme throughout the conversation, with both Nancy and Barbara underscoring its critical role in data monetization. Nancy shared Wolters Kluwer's approach of establishing a centralized group responsible for curating tools and building applications. This strategy not only ensures expertise in technology utilization but also fosters trust within the organization.
Barbara highlighted the significance of leadership and a clear vision in the success of data monetization efforts. Leaders play a pivotal role in articulating a compelling vision, setting clear expectations, and building trust among employees, customers, and stakeholders. In an era where data privacy and ethics are paramount, trust becomes a cornerstone for sustainable data monetization.
To listen to Barbara and Nancy’s full discussion or to read the transcript, visit the podcast page: Legal Leaders Exchange: The power of data analytics and monetization - Driving growth and innovation. If you are a podcast app user, be sure to follow our Legal Leaders Exchange show on your favorite app (Apple Podcast, Spotify, Google Podcast, Amazon / Audible.com, iHeart Radio), to make sure that you don’t miss any of our informative episodes.
