Promoting Open Data in Nepal’s Private Sector

September 11, 2019

By Pranaya Sthapit

The rapid growth, in our era, of data-driven decision-making offers both a challenge and an opportunity for businesses at every level in Nepal. As government agencies, research institutes, and the private sector apply new quantitative tools and the analytical power of computers to understand human systems and social phenomena of every kind, the opportunities for business are obvious: to analyze markets and improve operations, to develop innovative new products and services, and to make better-informed business decisions.

But ever-growing data sets present the difficult challenge of openness. “Open data,” data that is well-organized, machine-readable, and presented on public data portals or via application programming interfaces (APIs), can be a powerful tool for governments, NGOs, journalists, and certainly businesses. McKinsey has estimated that open data’s global annual value is more than USD 3 trillion. The European Data Portal has projected the market for products and services based on open data at EUR 325 billion for 2016–2020. But in Nepal, publicly accessible data is too often limited to aggregate findings and shared primarily as PDFs or printed booklets. These data sets may be “public,” but they are not “open.” At the extreme, business data tends to be proprietary and unavailable for public use—these data sets are neither public nor open.

As a result, data-driven business practices have lagged in Nepal, despite their acknowledged potential, and businesses commonly find themselves making business decisions based on traditional business practices rather than on data. This article examines some of the obstacles to widespread use of open data in Nepal’s private sector.

Individuals perceive and react to the social world around them through what the philosopher and sociologist Pierre Bourdieu called habitus, ingrained skills and dispositions acquired through participation in common practices. This internalization of common practice creates a comfort zone, and old habitus are difficult to dislodge. Despite the rapidly changing global business environment, especially with respect to data, Nepal’s private sector remains lodged in its old comfort zone, basing business decisions on personal observation, informal information, and common assumptions.

Roundtable discussion with the private sector at Birjung, Nepal

In June of this year, FACTS Research and Analytics of Nepal, in collaboration with The Asia Foundation and Development Initiatives, released How Can Data Support Business in Nepal, a study examining the demand, use, and sharing of open data. A survey of 135 small, medium, and large companies across 10 districts in Nepal, the study explores how businesses in Nepal are currently using data, the unmet demand for data among Nepali businesses, and the potential supply of data from businesses in Nepal. The study found that open data and the use of data for decision-making and business operations by the private sector are still in a nascent stage in Nepal.

To promote their findings and stimulate discussion, FACTS Nepal organized a pair of roundtable discussions, “Open Data Culture in Nepal among Private Sector Businesses,” with representatives of the private sector, the media, and the government, in Birjung and Pokhara.

Both the survey and the roundtable discussions revealed that the private sector is aware of the value of open-format data for business and economic growth. According to the survey, 60 percent of businesses were extremely or very supportive of sharing data in an open format, 20 percent were moderately supportive, and 2 percent were slightly supportive. A representative of a business organization in Birjung remarked, “It isn’t that there is no awareness of the importance of data and open data, but businesses have not been able to take the next step to using and sharing data.”

The survey and the roundtable discussions identified four major gaps in data use and open-data culture among businesses in Nepal:

1. Unavailability of data. Businesses are looking for specific information and official government data in areas like agriculture, construction, manufacturing, services, trade, and tourism. When asked about the principal obstacles that prevent businesses from using government data, 64 percent of respondents said government data is difficult to find, 38 percent said there is a lack of relevant data, 34 percent said government data is difficult to access, and 25 percent responded that the available data is not specific enough.

2. Unreliability of data: Even if data is available, it is often unsuitable for business decision-making because it is inaccurate, imprecise, or insufficient. The study identified data that is out of date (51 per cent) or inaccurate (17 per cent) as major obstacles to private-sector use of government data. The business sector in Nepal also questions the reliability of government data because of frequently mismatched sources. This has discouraged the use of government data in business decision-making in Nepal.

3. Inability to analyze and use data. Another hurdle for private-sector data use is the lack of capability among businesses themselves to meaningfully analyze the data that is available. Businesses know there are tools to be had, but many still feel they lack expertise in the complicated world of data analytics. While, overall, most companies surveyed expressed some confidence in their ability to use data effectively, just 38 percent of large-scale businesses and fewer than 20 percent of medium- and small-scale business reported being “very” confident in using data effectively for informed decision-making. Given the potential to profit from better-informed decision-making, there is ample reason for businesses to improve their data analytics capability, so why are they neglecting this step? It is not farfetched to suppose that businesses are simply comfortable with their own habitus and see data as a limited tool rather than a comprehensive driver of business strategy.

4. Reluctance to share company data. Data from other, similar businesses could well be the most valuable information for companies, but because information asymmetries can be a source of competitive advantage among businesses, many companies do not see the economic and operational value of sharing nonidentifiable and nonconfidential data in an open format. Although they express support for open data, only half of respondents said they would be willing to share their own company’s data. A majority (67 percent) cited the need to protect proprietary information as a major obstacle to sharing data.

Data has become the cornerstone of business in the digital age, and substantial economic and operational benefits await Nepali businesses that integrate open data into their operations; but only by demanding, sharing, and using data will data-driven decision-making displace the ingrained habitus of business in Nepal. Education about relevant tools and techniques for business intelligence and visualization would be a good first step to help businesses see the value of using data. Then, as data-driven decision-making is more widely adopted, businesses will need to press their demand for quality data from government and other stakeholders. Sharing raw data in open formats will encourage producers to improve their data products, leading to a growing confidence in data-driven decision-making, which in turn will cause the culture of open data to thrive.

Pranaya Sthapit is a program officer in The Asia Foundation’s Data for Development program. He can be reached at [email protected]. The views and opinions expressed here are those of the author, not those of The Asia Foundation. 

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