Risk Management in the Era of Data Storytelling

Humans have been telling stories for over 30,000 years. Stories help us communicate, connect, and make sense of our experiences and world. Insights  and intelligence driven by data enabled storytelling to evolve into a more sophisticated form. The ability to fuse a narrative with data has given rise to data storytelling and with it an increased need for better governance.

Technology and The Rise of Data Storytelling

Traditionally, storytelling relied on anecdotal evidence, personal experiences, and imagination. However, with the advent of big data and advanced analytics, it has become more evidence-based and compelling. The ability to effectively communicate insights and glean intelligence from a dataset using narratives and visualizations form the basis of data storytelling—integrating statistics and data with the purpose of enriching the narrative to influence a business decision or action.

Google’s Chief Economist Dr. Hal R. Varian expressed the importance of data storytelling back in his 2009 interview with McKinsey’s James Manyika, a director in the San Francisco office. “The ability to take data—to be able to understand it, to process it, to extract value from it, to visualize it, to communicate it—that’s going to be a hugely important skill in the next decades," Varian said.

There have been significant changes in data technology over the past 15 years. The emergence of augmented realty (AR) and interactive platforms have revolutionized how data is presented and consumed. AR overlays digital information onto the physical world, offering immersive narratives that blend seamlessly with reality. Perhaps you’ve had the opportunity to walk through a museum using AR to visualize historical data or experience interactive exhibits that reveal layers of information.

Interactive platforms empower users to engage with data in real-time, fostering a dynamic storytelling experience. For example, The New York Times employs interactive graphics to explain complex topics such economic trends, enabling readers to interact with the data and uncover insights at their own pace.

Valuable Data Storytelling Do's and Risky Don'ts

Infusing data into stories offers numerous benefits. Data makes narratives more memorable and impactful, and the advent of new technologies provides immersive experiences—but the potential for misinformation or manipulation exists, which can lead to biased or misleading narratives. Therefore, it's crucial for organizations to uphold ethical standards and transparency in their data storytelling practices.

As a result of those possible pitfalls, the role of governance cannot be understated. Leadership teams and boards of directors play a pivotal role in overseeing risk management and new technology considerations. As stewards of the organization, they must ensure data storytelling initiatives align with strategic objectives while mitigating potential risks.

Effective governance entails establishing clear guidelines and frameworks for data usage, ensuring compliance with regulatory requirements such as GDPR and CCPA. Leaders and boards should actively engage with emerging technologies, staying abreast of industry trends and innovations to capitalize on opportunities and effectively mitigate risks. To help make that happen, keep in mind these do's and don’ts:

1. Do leverage data to enrich narratives and enhance storytelling. Data serves as the backbone of compelling storytelling, providing evidence and context to narratives. When leveraging data, strive for diversity in sources to ensure comprehensive insights. Use data visualization techniques effectively to make complex information more digestible and engaging for your audience. Moreover, consider the emotional resonance of the data—how it relates to human experiences and values—to create a deeper connection with your audience.
2. Do embrace emerging technologies such as AR and interactive platforms to create immersive experiences. Embracing emerging technologies opens up exciting possibilities for immersive storytelling experiences. Be sure to balance innovation and practicality. Assess the suitability of each technology in terms of your storytelling objectives and audience demographics. Experiment with different formats and interfaces to find the most effective way to convey your message.
3. Do prioritize transparency and ethical considerations in data usage. Transparency builds trust with your audience and demonstrates integrity in your data storytelling practices. Clearly communicate the sources and methodologies behind your data to provide context and credibility. Respect user privacy by anonymizing sensitive information and obtaining consent for data collection and usage. Adhere to ethical guidelines and industry standards to avoid inadvertently misleading or manipulating your audience.
4. Do engage with stakeholders, including the board of directors, to ensure alignment with strategic objectives and risk management. Collaboration is key to successful data storytelling initiatives. Engage stakeholders early and often to gain buy-in and alignment with strategic objectives. Solicit feedback and insights from diverse perspectives to enrich your storytelling narratives and address potential blind spots. Involving the board of directors ensures oversight and accountability, fostering a culture of responsible data usage and risk management within the organization.
5. Do continuously innovate and adapt to evolving trends and technologies. The landscape of data storytelling is constantly evolving, driven by advances in technology and changes in audience preferences. Stay agile and open to experimentation, embracing new trends and technologies as they emerge. Monitor industry developments and seek inspiration from other disciplines to infuse fresh perspectives into your storytelling approach. Continuously iterate and refine your strategies based on feedback and performance metrics to stay ahead of the curve.
6. Don't overlook privacy concerns when using AR and interactive platforms. While AR and interactive platforms offer immersive storytelling experiences, they also raise privacy considerations. Take proactive measures to safeguard user data and respect privacy preferences. Implement robust data security measures to protect against unauthorized access and data breaches. Be transparent about the data collection practices associated with your storytelling experiences and provide users with control over their personal information.
7. Don't sacrifice accuracy for the sake of engagement; uphold integrity in data storytelling. Accuracy is paramount in data storytelling, as inaccuracies can erode trust and credibility. Verify the accuracy of your data sources and validate any statistical claims to ensure their reliability. Avoid cherry-picking data or manipulating visualizations to fit a predetermined narrative, since this can lead to biased or misleading interpretations. Uphold ethical standards and integrity in your storytelling practices to maintain credibility with your audience.
8. Don't underestimate the importance of governance in managing risks associated with data usage and emerging technologies. Governance provides the framework for responsible data stewardship and risk management within an organization. Establish clear policies and procedures for data collection, usage, and dissemination to ensure compliance with legal and regulatory requirements. Implement robust controls and oversight mechanisms to mitigate risks associated with data usage and emerging technologies. Foster a culture of accountability and transparency to promote ethical conduct and integrity in data storytelling initiatives.
9. Don't neglect the role of the board of directors in providing oversight and guidance. The board of directors plays a crucial role in providing strategic direction and oversight for data storytelling initiatives. Ensure the board is actively engaged in discussions related to data governance, risk management, and emerging technologies. Seek input and guidance from board members with expertise in relevant areas, such as data privacy, cybersecurity, and strategic planning. Leverage the collective wisdom and experience of the board to inform decision-making and drive organizational success.
10. Don't shy away from experimenting with new approaches and technologies to push the boundaries of data storytelling. Innovation thrives on experimentation and exploration of new ideas and technologies. Embrace a culture of curiosity and creativity within your organization, encouraging team members to think outside the box and push the boundaries of traditional storytelling formats. Foster a safe environment for experimentation where failure is viewed as a learning opportunity rather than a setback. Be open to feedback and iterate on your ideas to refine and improve your storytelling strategies over time.

The future of data storytelling is bright, fueled by the increasing ability to convert data into insights and intelligence and the emergence of technologies that offer unprecedented opportunities for engagement and immersion. However, with these opportunities come risks, underscoring the importance of effective governance and ethical considerations. By embracing innovation while upholding integrity and transparency, organizations can harness the power of data storytelling to drive meaningful impact in the digital age. 

How has your organization fared using data storytelling? We’d love to hear your success stories and challenges.