The one-size-fits-all centralized data governance model has run its course in the financial industry. There is a need for a more efficient and that serves business better. Governance should be allowed to be distributed to data owners where appropriate, which would help the finance function optimize data to make decisions. Decision-readiness is much better than accuracy and precision because it is a much more consistent and complete process.

If financial data were made decision-ready, financial governance principles would be adapted for non-financial performance data. Decision-ready financial data would bolster trust in internal reports because it would incorporate more intuitive data as well as highly-governed data. This would also define the relationship between financial and operational data. If financial data were decision-ready, then it could potentially provide areas that have the most economic benefit with more opportunity to focus on data quality improvements.

Today, organizations are creating and utilizing a large and growing amount of transactional, operational, and other enterprise data. Often times, finance will opt for a “single source of truth”, but that’s not enough anymore. While it can be useful at times, especially to organizations that require precision, but it’s not really that useful for decision making. When the data is provided without context or shared with a business in a way that it can’t easily absorb, then it becomes useless. 

According to research, finance needs more pragmatism and flexibility. Finance should deliver comprehensive data faster in order to make decisions, however, this could also take a toll on data accuracy. Instead of a “single source of truth,” finance should opt for a “sufficient version of the truth”, which is oftentimes enough. By making informed trade-offs between the cost of bad data and the effort needed for additional data governance, finance is able to provide a “sufficient version of the truth”, which benefits the business when done correctly and gives them a better outcome. 

Data needs to be prepared differently for decision-readiness to be improved. To have a better decision-ready strategy, finance must support distributed data owners with guidelines on which data to govern and the extent of governance as well as effectively store and protect data.

A framework is needed for data quality, drives informed decisions about the trade-offs, and helps to make data governance more scalable. Even if the data isn’t perfect, mutually agreed data quality frameworks will create a shared trust that multiple versions of the truth are good enough to make well informed financial decisions.