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By Thomas C. Redman

The following is an excerpt from Thomas C. Redman's new book 'Data Driven: Profiting from Your Most Important Business Asset" copyright 2008 by Thomas C. Redman, Harvard Business School Publishing. All rights reserved. Reprinted with permission. The book is available at Amazon.com.

To truly earn the title assets, data and information must prove themselves in the marketplace. This chapter and the next focus on the marketplace demands for data and information, the many ways to meet those demands, complications in doing so, and some of the questions organizations should ask in deciding what's right for them.

The most obvious way to bring data and information to the marketplace is to develop and provide new content. Lots of companies already do so. National newspapers and medical diagnostics come immediately to mind, and they present an interesting contrast. Depending on the story, there is a large market for the news. But, especially with the advance of the Internet, those interested in an article don't need to purchase the newspaper. Thus, as the financial health of most daily newspapers attests, it is a tough business.¹

On the other hand, only you, your doctor, and at most a few others are interested in your latest cholesterol report. The market for any given report is small, even though the report is easy to copy and distribute. The market for medical tests, however, is growing steadily each year.

A more subtle way to bring data and information to market is informationalization; that is, building data and information into existing products and services. My favorite example is the feature in new automobiles that provides you with step-by-step driving instructions while en route. Not only does it get you there faster, but also it means that husbands and wives can't fight over whose fault it is that they're lost. Informationalization is a brilliant insight, and companies ought to do more of it.

So far, I count fifteen ways to bring data and information to the marketplace (see table 5-1), and this list does not include improving qual- ity and making better decisions, both of which certainly have marketplace implications. There are several observations to be made about this table. First, my fondest dream is that this list will be hopelessly outdated ten years from now. The fun of the Information Age lies in developing wholly new ways of creating value.

That said, the table also features classic and more recent examples. As the classic examples attest, there have always been markets for data and information. The Information Age examples portend not so much that everything has changed as that demands for exactly the right data and information in exactly the right place at the right time and in the right format to complete an operation, serve a customer, make a decision, or set and execute strategy have accelerated and will continue to accelerate.

Third, the table is divided into two categories: content providers and facilitators. Content providers aim, in some form or fashion, to provide data and information specially tailored to the tasks at hand. They are the subject of this chapter.

Facilitators make it easier for content providers to do so. Infrastructure technologies such as land-line communications are classic examples. Infomediation is another good example. Infomediators do not provide content data per se. Instead, they help people find the data and information they need. A travel agency is a classic example; Google is a more recent one. Facilitators are discussed in the next chapter.

Finally, the table presents some interesting contrasts. Next to informationalization on the list is unbundling, which involves removing the data and information from an existing product or service and selling it as a stand-alone offering. Separating investment advice and trade execution is my favorite example-another brilliant idea. At the very least, unbundling enables a company to determine what customers actually value. It also introduces competition and gives the customer choice, which are almost always good things, in my opinion. Do you want investment advice from someone who intimately understands you, your situation, and your needs with no special products to push? It's available. Do you want to do your own research and pay low trade commissions? Also available. Of course, informationalizing and unbundling, each an insightful, executable prescription in its own right, point companies in different directions. What is going on? The only possible answer is that informationalizing is appropriate for some companies and inappropriate for others. So too unbundling.

Chapters 5 and 6 therefore pose a series of questions that aim to help companies baseline their current positions and select directions that are right for them. Managers, especially those responsible for strategy, customer-facing marketing, sales or service, and product enhancement and innovation, should use these questions to explicitly think through each of the fifteen ways of bringing data and information to market and begin to focus on what is right for their organizations.

Those trying to bring data and information to market face daunting challenges. I've already cited two: the ease with which data and information can be copied and resold and the observation that the market for any particular piece of data or information may be very small. These two chapters lay out several other issues, but stop short of providing proven prescriptions because they do not exist-yet.

Next: Insatiable Demands