Bilal Khan is managing partner and head of Deloitte Data.
The value of data in the modern economy is clear – it’s now the single most important asset to four of the five largest companies in the world.
Canada faces a David versus Goliath effort to compete with global leaders for a piece of the growing data economy. When it comes to data, scale matters. With 1.3 billion more people than Canada, China has access to roughly 35 times more sources of data. This gives Chinese businesses a massive head start in the search for customer insights, and makes it hard for Canada to compete on anything close to an even footing.
Even compared with countries closer to our size, such as Australia, we face a data deficit that threatens Canada’s future prosperity. If we want to succeed in this new world, we need to find ways for Canadian businesses to unlock value from data while keeping personal information protected and secure. We have to be open to bold and innovative ideas around data management.
One way of reaching this goal is to create a Canadian-built data collective to help connect the dots between data sets that exist in business and government silos. As it stands today, one organization might have a fraction of the data needed to make an important business or policy decision, while a different organization has another small but important piece of the puzzle.
Individually, the value of the data is limited – maybe even useless – but when combined, they can produce a full data set that provides huge value to both organizations and, most importantly, the end user.
To rival and ultimately lead our global competitors, we should leverage the power of an inventory of national data from both the private and public sector in ways other countries haven’t yet embraced, which would enable our industries and businesses to achieve data scale through partnerships. In short, organizations need to share data, not hoard it.
Canadians have successfully created national collectives before. Thirty-five years ago, some of Canada’s largest financial institutions looked beyond individual bottom lines to serve the interests of all Canadians. They came together to build a uniquely Canadian, cutting-edge solution that gives us broader access to our own money through a single shared network and, as a result, more than three decades later, millions of us still benefit using Interac.
Historically, many Canadian industries have been protected from foreign competition by way of regulation, but the arrival of the internet and the digital economy has created new direct-to-consumer channels, and in turn has allowed disrupters to establish workarounds, putting many Canadian businesses at a major disadvantage.
For example, U.S.-based Netflix was not required by law to file for a Canadian Radio-television and Telecommunications Commission licence to operate in Canada, and consequently didn’t need to abide by the myriad of content rules and regulations that domestic broadcasters must follow.
Netflix now owns more eyeballs than any one Canadian content producer and more data on Canadians than our country’s film and television producers. This data, which now sits on American servers, leads to better predictions on what Canadians want to watch and yields an improved user experience. The economic earthquake that came in Netflix’s wake involved huge swaths of Canadians cancelling their cable packages –money and data that walked right across the border and took up residence in the United States.
The leading data economies and the first-mover companies have a daunting head start over us. They’re building enormous collections of data that are feeding into a variety of transformational initiatives from autonomous vehicles, machine learning applications, smart cities, space exploration and beyond. It’s vital Canada doesn’t just limit its ambition to copying what others have done. We must start thinking about how to set new standards for how to unlock value from data. A national data-sharing collective can achieve this.
Along the way, strategy development must preserve and strengthen the protection of data. Trust must be the bedrock of Canada’s data collective. Without it, new innovations rooted in the harnessing of data will not pass our citizens’ smell test. Data alliances come with a host of risks – regulatory, privacy, ethical, governance and security. The challenge will be how to create a data ecosystem while retaining and protecting individual privacy in cases where personally identifiable information is present.
Canada is more than up to the test, but this can’t be a theoretical or policy discussion. This initiative needs to be rooted in execution and in actively managing regulations and building new data infrastructure that will create the circumstances for success.
This is an opportunity to lead a shift in global data management while keeping Canada strong and competitive. Let’s prove to the world that a balanced and ethical approach to building a data economy through data collaboration is not only possible, but also the right way forward.