The shipping industry is one world’s most essential industries responsible for transporting goods and materials around the globe and plays a vital role in the global economy.
However, the shipping industry is also one of the world’s most complex and regulated industries. This complexity is only compounded by the fact that the shipping industry increasingly relies on data and technology. As a result, data governance has become an essential part of the shipping industry.
Data governance is a complex topic, and there is no one-size-fits-all solution. However, there are some fundamental principles that all shipping companies should follow to ensure that their data governance is effective.
This blog outlines what data governance is, its importance, and the best practices in the shipping industry.
What Is Data Governance?
Data governance involves the process of guaranteeing that data is accurate, complete, and timely. It includes the development of policies and procedures for managing data, as well as the implementation of systems and controls to monitor and enforce those policies.
Most businesses and industries rely on data to make decisions, but it’s especially critical in the shipping industry, where the consequences of inaccurate data can be catastrophic. Nowadays, shipping companies increasingly rely on data managed by database service providers such as Buchanan to make decisions and drive efficiencies.
For example, data is used to route vessels, optimize cargo loads, and predict maintenance needs. However, the industry faces challenges in managing data due to its complexity and volume. In particular, the industry must deal with data from various sources, including weather, tide, and GPS systems.
Benefits Of Data Governance In The Shipping Industry
Data governance is essential for managing data and ensuring that it’s high quality, accurate, complete, and meets the needs of the business. Below is a discussion of the benefits that data governance provides to the shipping industry:
1. Ensures Accuracy And Completeness
In the shipping industry, data governance ensures accuracy and completeness in the data used to track and manage the movement of goods. The process includes the development of policies and procedures for managing data, as well as the implementation of systems and controls.
Data governance is critical in the shipping industry because of the high volume of data generated and the need to share this data across multiple parties. Inaccurate or incomplete data can lead to shipment delays, misrouted cargo, and other problems impacting the bottom line.
Data governance helps establish processes for monitoring data quality and for correcting errors. Systems can be improved over time by regularly checking data for accuracy and completeness and correcting errors when they’re found. Data governance can also help prevent errors from being made in the first place by establishing clear rules and procedures for data entry and storage.
2. Improves Data Quality And Consistency
To ensure that goods are delivered safely and efficiently, the shipping industry must have high data quality and consistency standards. Data governance provides a set of processes and policies to manage and protect data. By improving data quality and consistency, data governance helps the shipping industry to run more smoothly and avoid costly mistakes.
One way that data governance improves data quality is by establishing clear guidelines for how data should be collected and stored to ensure that data is accessible to those who need it, including the stakeholders and all the different types of small business that rely on the industry.
Data governance can also help ensure that data is consistent across different systems and databases. It’s important in the shipping industry, where companies may use different software to track shipments. If data is inconsistent, it can be difficult to track shipments, compare data from different sources, and ensure they’re delivered on time.
3. Provides Framework For Data Risk Management
Data governance is crucial for data risk management in the shipping industry. By establishing clear policies and procedures for data management, shipping companies can protect themselves from the risks associated with data loss, data breaches, and other data-related problems.
Data governance helps shipping companies identify and assess the risks associated with their data and put in place controls to mitigate those risks. For example, a shipping company might establish a policy that requires all data to be encrypted when it’s stored on company servers. This policy would help protect the company’s data in case of a data loss or breach.
In addition to establishing policies and procedures for data management, data governance can also help shipping companies monitor their data and ensure that it’s being used under company policy. Data governance can identify and track unauthorized access to company data and ensure that it is being used for its intended purpose.
4. Helps Make Better-Informed Decisions
Data governance includes the management of data as a strategic asset. It consists of the roles, processes, metrics, and standards that ensure data is fit for purpose. In the shipping industry, data governance can help make better-informed decisions in several ways.
The following are examples of how data governance help make better-informed decisions:
- Data Accuracy: Up-to-date data helps make better decisions about where to route ships and schedule deliveries.
- Complete Data: The completeness of data can lead to better-informed decision-making about the capacity of a port or the amount of cargo a ship is allowed to carry.
- Data Consistency: Consistency of data is especially important when it comes to things like the nautical charting of a shipping lane.
- Data Accessibility: When data is easily accessible, it helps make decisions about things like the location of a shipyard or the availability of spare parts.
- Understandable Data: Data must be understandable as this comes in handy when making specific decisions, such as signing and interpreting a shipping contract.
That said, data governance can help make better-calculated decisions. It can also help shipping companies avoid making decisions based on inaccurate data.
5. Reduces Operational Costs
Data governance can play a critical role in reducing operational costs in the shipping industry. By definition, data governance is the process of managing data throughout its lifecycle, from its creation to its eventual disposal. This process includes defining roles and responsibilities for those who work with data, establishing processes for collecting and maintaining data, and ensuring that data is accurate and consistent.
In the shipping industry, data governance can help reduce operational costs by:
- Streamlining and automating data collection and management processes
- Ensuring data accuracy
- Improving data visibility and decision-making
- Establishing standardized processes for data collection
- Establishing quality control procedures
- Maintaining a central repository of shipping industry data
- Developing reporting and analytics tools that provide insights into shipping industry trends
The operational costs associated with managing data will increase if the shipping industry fails to use data governance. This is because without data governance in place, data will be more difficult to manage and control.
As a result, organizations will need to spend more time and resources on data management activities, such as data cleansing and security. In addition, it’ll be more challenging to make data-driven decisions without data governance, as data will be of lower quality and less reliable. As a result, the shipping industry will be less efficient and effective, and operational costs will increase.
However, when appropriately implemented, data governance can significantly reduce operational costs in the shipping industry.
6. Ensures Compliance With Regulatory Requirements
The shipping industry is subject to many international conventions, treaties, and national laws and regulations. This means that data governance is essential to ensure compliance with all of the applicable requirements. A good data governance framework will help ensure that data is managed effectively and that all relevant conditions are met.
Shipping companies deal with plenty of data, including ship and cargo manifests, bills of lading, and other documents. Different elements must be considered to have an effective data governance framework. These elements include:
- Data Quality
- Data Accuracy
- Data Completeness
- Data Consistency
- Data Control
- Data Management
All these elements are essential to ensuring compliance with regulatory requirements, and a good data governance framework will help ensure that all applicable requirements are met.
Data Governance Best Practices In The Shipping Industry
Data governance is critical for the shipping industry, given the large amounts of data generated and the need to ensure that this data is accurate and up to date. Several best practices can be followed to ensure effective data governance, including:
1. Defining Clear Roles And Responsibilities
In the shipping industry, data governance can be a challenge. Many stakeholders are involved in the shipping process, from the vessel owner to the shipper to the consignee. Each of these stakeholders has their own interests and needs when it comes to data.
It’s essential to define clear data governance roles and responsibilities to govern data effectively in the shipping industry. You must determine the ones responsible for collecting data, maintaining data quality, and making decisions about data.
Once roles and responsibilities have been defined, it’s vital to establish clear processes for data governance. How will data be collected, stored, and accessed? Who’ll have access to data?
By defining roles and responsibilities and establishing processes, the shipping industry can effectively govern data and ensure that data will be used to benefit all stakeholders.
2. Implementing Data Quality Controls
Data quality is a critical issue for the shipping industry. Implementing data quality controls can help ensure data accuracy and completeness, improve data sharing and decision-making, and protect the industry’s reputation.
Several data quality issues need to be considered in the shipping industry. These include:
- Inaccurate Data: Inaccurate or incomplete data can lead to decisions based on incorrect information, resulting in financial losses and damage to the industry’s reputation.
- Duplicate Data: Duplicate data can lead to confusion and wasted time and resources trying to reconcile different versions of the same data.
- Inconsistent Data: Inconsistent data can make it difficult to compare and analyze data from different sources. This can lead to decision-making based on inaccurate or incomplete information.
- Outdated Data: Outdated data can make it difficult to track trends and make decisions based on the most current information.
The shipping industry needs to implement data quality controls to address these issues. Data quality controls can be divided into two main categories:
- Data Entry Controls: Data entry controls help ensure that data is entered correctly and completely. This includes controls such as data validation and data cleansing.
- Data Management Controls: Data management controls help ensure that data is stored, accessed, and used correctly. This includes controls such as data security and data governance.
Data quality controls should be designed to address the specific needs of the shipping industry. The type, volume, and way data is used will all need to be considered when designing data quality controls.
Data quality controls need to be implemented at all levels of the organization, from data entry to data management. All employees working with data need to be trained on the data quality controls that have been put in place.
3. Communicating Data Governance Policies And Procedures
An effective data governance program starts with clear policies and procedures that are communicated to all employees. These policies should cover how data is collected and stored to how it’s used and shared. Employees should be trained on these policies to follow them properly.
4. Monitoring And Auditing Data Governance
Once policies and procedures are in place, it’s important to monitor compliance and ensure that data is used correctly. This can be done through regular audits and reviews. If problems are found, they should be addressed quickly so that data remains accurate and reliable.
By implementing an effective data governance program, shipping companies can ensure that their data is accurate and reliable, allowing them to make better decisions that improve their bottom line.
5. Regularly Reviewing And Updating Policies And Procedures
As the shipping industry evolves, so must the data governance policies and procedures. By regularly reviewing and updating these policies, organizations can ensure that they always comply with the latest regulations.
Data governance is a critical part of effective shipping industry operations. By following best practices, shipping companies can ensure that their data is accurate and up to date, which is essential for making informed decisions.
The benefits of data governance are clear. By improving data quality through proper data governance and with the industry’s best practices as a guide, organizations can make better-informed decisions, improve operational efficiency and reduce costs. In a complex and competitive industry like shipping, these benefits can make a real difference to the bottom line.