Information Governance and the Cloud – Collecting Value or Hoarding?

By Teresa P. Schoch

While recently wandering side streets of London and Paris, I noticed “the cloud” being offered in small storefronts alongside cafes offering baguettes and cappuccinos. The ubiquitous and trusting adoption of this intangible data-storage solution as organizations scramble to protect apparently sacred private information collected from the same individuals buying these cloud services is remarkable. Organizations are simultaneously tasked with addressing burgeoning costs of litigation and other consequences of excess data storage seemingly being alleviated by the cloud.

Hoarders Have Earned Their Own DSM[i] Code

Businesses need to be on that reality show with hoarders whose lives are driven by their possessions.[ii] (Corporations are legally people, after all.) It is not a pretty picture when the reptilian part of the brain is in charge of the survival-driven human or business animal.

In business, and staying with the reptile image, we often see the head looking behind at an enormous information tail, so heavy that the creature can hardly move forward. It is a tail with no measure of value that puts the entire being at risk, because the effect of its weight requires attention that should be focused instead on the rapidly changing environment ahead in which it must survive.

In spite of the astounding costs of information storage, in many multinational corporations there is very little, if any, data deletion. Why is this when, even at its creation, 70-plus percent of data is useless for business, regulatory, or legal reasons?[iii]

In 2013, hoarding was officially recognized as a psychological disorder. According to the Mayo Clinic,

Hoarding disorder affects emotions, thoughts and behavior. Signs and symptoms may include:

  • Persistent inability to part with any possession, regardless of its value
  • Excessive attachment to possessions, including discomfort letting others touch or borrow them or distress at the idea of letting an item go
  • Cluttered living spaces, making areas of the home unusable for the intended purpose, such as not being able to cook in the kitchen or use the bathroom to bathe
  • Keeping stacks of newspapers, magazines or junk mail
  • Letting food or trash build up to unusually excessive, unsanitary levels
  • Acquiring unneeded or seemingly useless items, such as trash or napkins from a restaurant
  • Difficulty managing daily activities because of procrastination and trouble making decisions
  • Moving items from one pile to another, without discarding anything
  • Difficulty organizing items, sometimes losing important items in the clutter…

People with hoarding disorder typically save items because:

  • They believe these items will be needed or have value in the future…

Hoarding disorder is different from collecting. People who have collections, such as stamps or model cars, deliberately search out specific items, categorize them and carefully display their collections. Although collections can be large, they aren’t usually cluttered and they don’t cause the distress and impairments that are part of hoarding disorder.[iv]

Translated to the corporate entity, this would be considered knowledge management or refined information management.

Drawing parallels between businesses’ behavior toward their accumulative information and the above DSM code definition is easy. As a consultant, I have worked with large multinationals for which retention policy is simple: “We keep it all.” In essence, junk mail, piles of newspapers, and data hinder the ability to manage daily activities. Whether the data announces a past picnic or delineates a business plan does not matter.

The justification will inevitably include the excuse that attorneys are fearful of litigation or bureaucratic sanctions (i.e., items might be needed or valuable in the future). While these businesses may succeed in avoiding sanctions for an inability to produce evidence, eDiscovery budgets in these careful companies are growing to six-figured millions. But strategic plans for creating valuable collections to address business and legal needs quickly, effectively, and at less cost are often shelved, as these are apparently less comfortable than keeping it all.

Finding Balance on a Spinning Planet: Just Keep It All?

Microsoft 365 recently set its email retention default to “forever.” Some in the information governance (IG) community argue that the governance of how and for what purpose email is used should be the focus of IG, using rapidly evolving data analytics software rather than deleting it when it no longer has value. As cloud-based information becomes less expensive, there will be increased incentive to continue to keep everything, with the tail feeling lighter through the offloading regardless of the content’s value. Like personal storage units, another business steadily increasing globally, the information can be moved out of sight, and in most instances, out of mind. The monthly expenditure becomes a steady outflow as a cost for peace of mind without further rational analysis.

In fact, recent conferences in the IG field have advanced the idea that we should be content with the “keep it all” mentality. What is behind the current movement toward simply migrating massive amounts of data, often of unknown origins, to the cloud? Is it driven by the dizzying growth of information? Are those who have worked to convince organizations to limit risks associated with keeping it all accepting that it is simply not going to happen? Is it a reaction to the future, when the Internet of Things will be so pervasive that information growth will dwarf our current sense of control?

The staggering Monday-morning statistics about how much information is captured and stored by individuals, organizations, and governments is mind numbing.  And yet, the responses to my queries regarding the prevailing rationale of keeping it all: “Do the math. It is worth the risk. Where is the return on investment in information governance? What are the odds of a lawsuit or breach that will cost as much as developing and implementing an IG framework?”

Why does this act of keeping it all seem reckless, if not self-destructive? Is it because of my experience with eDiscovery projects that were so costly that some companies did not survive? Was it the court-imposed sanctions on companies that could not produce evidence that they thought they had but could not produce? What will happen to those companies that keep it all, get hacked, and are required to notify anyone impacted because of the company’s maintenance of their private information? Can they even locate all personally identifiable information in the decreasing amount of time required to respond? Have the costs of avoiding compliance costs truly become more than potential governmental penalties, personal damages for privacy breaches, and court sanctions? Can companies find what they need to streamline their businesses operations and make clear business decisions when they are surrounded by more information debris than clear content? Are we mistakenly looking for quick returns on investments where we should be assessing costs of inaction?

The Future Is Not Now

In the future, information mapping and data analytics may be so sublime that all relevant information in a lawsuit would be retrievable quickly and accurately. That would mean that potentially damning evidence that could be used against the organization would also be easily retrieved. That same amazing technology potentially would be able to locate all necessary information for data breach notification as well, but damages incurred by the organization would grow with every successfully retrieved record, regardless of its current value to the organization.

Focusing only on return on investment in cloud-based storage, costs are reduced in the near term; balance sheets improve, and stuff gets out of the way.

What is the business model behind it? While profit from storage costs may be fairly low now, what will storage providers charge later for access to information using analytics provided by the storage provider? What will those costs look like over the long run? For one view of a potential future, ask attorneys about hostage fees associated with the storage of paper.[v] For the first year or two, law firms paid little if anything for storage, but over time, costs associated with the return of the information became so expensive that there was no motivation to remove it.

The business model is brilliant. None of us like dealing with what we have generated in the past while we are trying to move forward. We would rather pay to delay laborious decision making without assessing the true cost of our inaction. We fall for low upfront costs figuring we will solve the problem before those costs balloon.

Evolution: From Hoarders to Collectors

It is simply not in our nature to organize everything we move to off-site storage when it has become too much of a nuisance to maintain. We have already decided we don’t want to see it every day, and we don’t want to spend time on something unimportant. But if we were collectors of that which is truly valuable to us, rather than hoarders moving too quickly to organize and evaluate, it is questionable whether we would have ever needed clouds. Given the decreasing cost of storage that they provide, we need to approach them intelligently and rationally rather than with the reckless disregard of the hoarder.

The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinions, position, or policy of Berkeley Research Group, LLC or its other employees and affiliates.

[i] DSM codes are the classification found in the Diagnostic and Statistical Manual of Mental Disorders, a manual published by the American Psychiatric Association (APA) that includes all currently recognized mental health disorders.

[ii] Storage building has been the fastest-growing area in the commercial real estate industry in the past 30 years. IBIS World predicts self-storage revenue in the U.S. will reach: $28.2 billion in 2015 (up from $28.1 billion in 2014), $29 billion in 2016, $29.5 billion in 2017, $30.5 billion in 2018, $31.5 billion in 2019, and $32.6 billion in 2020 (Egan, John, “Forecast: Self Storage’s Surprising Space to Pass $30B in 2018” (May 27, 2015), accessed at: http://news.sparefoot.com/1443-storage-revenue-to-pass-30-billion-in-2018). See also Vanderbilt, Tom, “Self-Storage Nation,” Culturebox (July 18, 2005), accessed at: http://www.slate.com/articles/arts/culturebox/2005/07/selfstorage_nation.html; Kehoe, Todd “Off the List: Self Storage’s Surprising Space,” Albany Business Review (August 21, 2013), accessed at: http://www.bizjournals.com/albany/news/2013/08/21/off-the-list-self-storage-space.html. Kehoe points out that all of the people currently in the United States could fit into U.S. personal storage units.

[iii] See Paknad, Deidre,” Information Economics: Developing a Strategy for Reducing Information Risk,” Corporate Compliance Insights (August 5, 2013).

[iv] Mayo Clinic, “Diseases and Conditions | Hoarding disorder” (May 8, 2014), accessed at: http://www.mayoclinic.org/diseases-conditions/hoarding-disorder/basics/symptoms/con-20031337

[v] See Schoch, Teresa, “Attorneys Held Hostage,” New York Legal Admin. J. (2011).

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