Big Data and Business Intelligence: Organizations Hunt Actionable Insights to Improve Business Ops. June 2013
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1 Big Data and Business Intelligence: Organizations Hunt Actionable Insights to Improve Business Ops June 2013
2 Big Data and Business Intelligence: Organizations Hunt Actionable Insights to Improve Business Ops 2 Introduction In the past few years Big Data has grown quickly, from fringe topic to a top concern of CIOs and business leaders. No surprise; organizations of all sizes are drowning in ever-growing pools of data, desperate to put it to good use. Worldwide data production is now estimated at a staggering 1,800 exabytes per year. Little wonder that leveraging Big Data is a major focus of organizations today. The challenge is like the television show Hoarders. How do you sift through incredible amounts of materials, figuring out what s trash and what s treasure? Many organizations face an even more basic problem: In a recent study one in three executives said they couldn t find the right people internally with the right data. Clearly something is wrong. To better understand these and other current challenges, opportunities and practices related to Big Data, Slashdot Media recently conducted a survey of 500 IT and business leaders. We discovered organizations: 1.) Struggling to make sense of data 2.) Focused on using Big Data to improve business operations 3.) Thirsty for actionable data 4.) Trying different ways to effectively determine Big Data s business value Survey Results Question 1: What challenges will your organization face as a result of growing data? 21% 21% Deciding what data is relevant 17% 41% Cost of technology infrastructure Lack of IT skills to manage big data projects Deciding what technology is best Hands down, the most vexing aspect of Big Data is deciding on the data s relevance to business. Nearly half (41%) of respondents identified this as their biggest challenge.
3 Big Data and Business Intelligence: Organizations Hunt Actionable Insights to Improve Business Ops 3 Lack of IT skills to manage Big Data projects was cited by nearly 22% of those surveyed. A current job posting criteria describes the hard-to-find skillset needed: Performs sophisticated statistical analysis, interprets the data, and communicates results to both technical and non-technical audiences. Develops advanced statistical models and methodologies to predict, quantify or forecast various operational and performance metrics. Synthesizes current business intelligence or trend data to support recommendations. Similarly, 21% cited uncertainty about which technology is best to manage Big Data. Slightly less important is the cost of technology infrastructure (cited by 17%), but this may be due to lack of such infrastructure at many organizations Ironically, many report that an even bigger challenge managing Big Data has nothing at all to do with technology, but is cultural. For example, organizations often operate as departmental silos, with business units reluctant to share information. This structure makes it difficult to assess what data the organization has, let alone make intelligent decisions based on it. Other cultural challenges widely reported include: What data, both structured and unstructured and internal and external, to use for different business decisions; Establishing trust with the individuals in the organization that make recommendations based on Big Data analysis; Attracting and retaining skilled data analysts that can manage Big Data resources; Convincing management to make investments in Big Data; Presenting Big Data analysis in useable form for various business units; Making strategic decisions on the insights gleaned from Big Data. Question 2: How will Big Data analytics change your business? 15% 16% More efficient business operations 37% Boosting sales 14% 18% Lowering IT costs Becoming more agile Attracting and retaining customers
4 Big Data and Business Intelligence: Organizations Hunt Actionable Insights to Improve Business Ops 4 Interestingly, much of the focus with Big Data centers on Making business operations more efficient, which was the number one goal cited by 37% of respondents. That reflects a goal of getting to know the organization better, an internal action. The focus should be on getting to know and respond to customer needs, an external action. The real opportunities with Big Data and BI will come from innovation supported by becoming more agile in the marketplace, by better attracting and retaining customers, by seeing new product and service opportunities, and thereby boosting sales. Unfortunately, boosting sales or attracting new customers then drops by more than half to 17% and 16% respectively. Taken together, they represent only one-third of all participants. This reveals a major disconnect for many organizations, which are expecting the greatest impacts in the wrong areas. Finally, an underwhelming number of organizations say they expect to become more agile as a result of Big Data analysis. (15%), or that they expect to lower the cost of IT (14%). Still, the majority of companies are losing out in all of the above areas, according to the Big Data Executive Report 2013 by NewVantage Partners. According to research by that firm, more than 50% of surveyed companies said their access to relative, timely and accurate data is less than adequate. Question 3: What is the most important factor in the successful use of Big Data and BI in your organization? 17% 40% Producting actionable insights instead of just data 22% Customizing analytics to business system and need Creating relationships that anticipate users' needs 21% Integrating diverse data sources Organizations investing in Big Data want insights, not just facts. Producing actionable insights is cited by 40% as the most important factor in the successful use of Big Data and business intelligence to reveal patterns, trends, and predictable behaviors. The next most important factor is creating relationships, cited by 22%. But relationships has two meanings here. Organizations want to anticipate and quickly meet user needs. But relationships also refer to data patterns and relationships.
5 Big Data and Business Intelligence: Organizations Hunt Actionable Insights to Improve Business Ops 5 A good current example is the Global Pulse initiative by the United Nations, which will use Big Data to help predict early warning signs of trouble in various parts of the world. The project involves conducting so-called sentiment analysis of social media messages to help predict disease outbreaks, job losses or spending reductions in a given region. The hope is to enable the U.N. to establish assistance programs in those areas early enough to avert catastrophic events. After relationships, the organization itself and its systems come next in importance. Twenty percent of respondents say the ability to customize analytics to business system needs is important; while 17% want the ability to integrate data from diverse sources. The clear message emerging from all of this is the greater need for analytical skills by both end users and IT. Business intelligence has become everyone s job. But that is not a role that comes easy for most workers, or even organizations. For many it involves a major cultural shift. IT is charged with collecting, storing, and making available data. It is up to the end user to act on that data in a way that aids the business. Question 4: How do you identify data with the most business value? 17% 16% 28% We depend on our business analysts We depend on our BI technology to assist us 23% 16% A combination of 1 and 2 We are still struggling with this Don't know / NA Don t let anyone tell you that ignorance is bliss. Or that what you don t know won t hurt you. Big Data holds big potential for those who know how to work with it. Unfortunately, many organizations have not mastered this goal, or even come close. Nearly one-in-five (17%) respondents say they struggle with how to identify data that has business value. Another 16% admit they simply don t know how. For 28% of organizations, deriving business value falls to internal business analysts. In contrast, 16% lean more heavily on BI technology itself to make the determination a figure sure to rise as technology evolves. Another 23% use a combination of internal business analysts and business intelligence technology.
6 Big Data and Business Intelligence: Organizations Hunt Actionable Insights to Improve Business Ops 6 Conclusion While there have been plenty of tales of terror about data overload, organizations can effectively manage and gain advantage from their Big Data. To help overcome the challenges, first assess how available skill sets compare against what s needed to store and analyze business intelligence. Next, determine what the organization wishes to accomplish with Big Data insights. The final step is building out an organizational strategy in incremental steps. Despite the early struggles many organizations have had managing and leveraging Big Data, more and more success stories are emerging. Many detail how organizations have developed systems to successfully store and share data; used analytics tools to search for patterns in data; and integrated data from diverse sources and devices so that it can reveal new secrets on how to better run the business or manage relationships with customers and suppliers. By better integrating and analyzing a variety of data sources, these organizations are gaining valuable insights, improving performance, and making better decisions.
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