A recent issue of The Economist featured a special report about dealing with data deluge. I thought it was a story about my email inbox, but only tangentially so.

The issue was fascinating, if for no other reason than I picked up some cool words about data size to throw around with my IT staff.  A 'petabyte' has 1,125,899,906,842,624 bytes and is 1,000 times larger than a terabyte, which is so last year.  Exabytes, Zettabytes, Zottabytes, and now Brontobytes are the next steps up the ladder, though I think that last one is a dinosaur shaped chicken nugget from McDonalds.

A logical reaction to the piece was a bit (or byte) of despair.  I already knew I was overwhelmed by data. My daily life told me that.  I now just had more statistics to validate my reality.

It was fascinating to read how governments, large companies, small companies, and individuals are dealing with the massive amounts of data that come at us every day.  The rate at which we are generating new data is mind boggling.

Much of it is information that has no real value, either because it serves such a temporary purposes and then is gone, or because it is just a bunch of noise.  Think of all of the data that are generated by cell calls, automated traffic lights, NASA satellites, and the million other ubiquitous data collection devices scattered around our world.

Some has no real value because it is just idiotic.  See 92% of YouTube videos and many text messages from your nearest pre-teenager.

But the real story in the story is not that we are generating tons of data, or that the data are burying us, or that a committee somewhere gets to come up with the next cool name for the next level of incomprehensible data measurement.

The real story is about assets.  Specifically, data as the new asset class.

Historically, economists have talked about the two primary assets that feed into a business:  Labor (people) and capital (money).

And assets are important because businesses use assets to create revenue, which turns into profit, which then morphs back into capital, which is cash. 

Data now represent a third primary input, a new type of asset.

Typically, we think about data as a part of the process of doing work, something that comes along for the ride, an outgrowth of the real work.  In doing work, we generate data, we store data, we analyze data, we use data.

Yet, thinking of data as a third type of asset is a new mindset that creates new opportunities.

No company typifies this better than Google.  Sure, there are smart, hard working people at Google, and sure, they invested a lot of money to build the product and the company.  But clearly, data is more than just the exhaust that comes off of the work.  It is THE asset that makes Google Google.

So here we are, sitting in the early stages of the complete digitization of the healthcare industry.  We're about to create a lot of new assets and someone is going to figure out how to turn that data into cash.

To be clear, healthcare has always been a data intensive industry.  A client of mine twenty years ago, a crusty old gastroenterologist, told me healthcare was nothing but an information business, occasionally interrupted by the laying of hands on the patient to do something.

The difference is that automation and digitization turn our mounds of data into functional assets, assets that can be converted into money and value.

We've seen this evolution in other industries and can consequently see the phases of change that we face in the coming future.

First, we've got to digitize the data at the source.  Pieces of paper, accumulated wisdom, and personal communication all have to be turned into ones and zeroes.  Parts of the healthcare system have already been doing this for years.  Digital radiology is just one example.

Some physicians just now coming to the party think their implementation of an EMR is the story.  But it is just the first chapter.  It is about converting their data to ones and zeroes.

Second, we'll then connect everybody's digitized data with everyone else.  We'll develop the mechanisms to pass information around from place to place.  Interfaces and health information exchanges and a whole alphabet soup of technology are all about getting all of the data into the same big pool somewhere.

These two phases will be hard and will require a lot of invested capital across the industry.  That is what everyone is talking about now.

But once we get through these two, it will really start to get interesting.

Data, the new asset kind, will begin to emerge.  People will experiment with new business models, looking for new ways to create value and new ways to create cash flow.

So, how do you think about your EMR?

Is this just an electronic chart?

Is it a tool to help with workflow inside your practice?

Is it your portal to the rest of the industry so you can move information in and out of your practice?

Or is it your opportunity to leverage a new type of asset, to create a new type of value, to generate a new flow of cash?