Big Data: a Big Deal for Businesses?
By Marie-Claude Veillette, Powersourceonline.com
In a world where social media sites, blogs, emails, pictures and videos are so prevalent in our day-to-day lives, huge and sometimes overwhelming amounts of information are collected each and every day by companies worldwide. This treasure trove of structured and unstructured data about consumers, suppliers, operations, and financial transactions is often referred to by the generic name of Big Data.
What Do We Really Mean by Big Data?
The McKinsey Global Institute refers to Big Data as “data sets whose size is beyond the ability of typical database software tools to capture, store, manage and analyze.”
Because Big Data is a collection of data sets so large and complex that it’s impossible to process them with the usual database tools, many companies don’t have the ability yet to link the data together and make sense of it in a useful and cost-effective way.
The Big Data challenge also resides in the fact that data is now coming from a wide variety of sources, and companies are not accustomed to collecting from so many and such a wide variety of sources. Moreover, analyzing very large volumes of data acquired rapidly or new types of data that haven’t yet been analyzed also poses its own difficulties.
According to, 90% of all Big Data in the world was created in the last 2 years.
How Does Big Data Apply to Companies?
In an era where businesses are faced with tougher-than-ever competition, more and more decision-makers are looking at Big Data initiatives as a way to outperform their peers by obtaining insight into what consumers are thinking in order to drive smarter and better business decisions.
Aiming to make the most of the fast-growing volume of digital data, companies will be more numerous this year to take Big Data seriously, predicts Deloitte in its 2012 study. The professional services firm forecasts that by the end of this year, over 90% of the Fortune 500 companies will have at least some Big Data initiatives under way with fewer than 50 full-scale Big Data projects worldwide.
During a webinar hosted by APTEAN in November 2012, Paul Greenberg, a guru in Customer Relationship Management (CRM) and author and President of The 56 Group, attempted to put things in perspective by saying that business decision-makers don’t have to get overwhelmed by the amount of information out there: “The value is not in the statistics, but in the picture you can paint from it.”
Ironically, he said that both the value and the difficulty of Big Data is that it gives people a lot to choose from; the challenge is figuring out what exactly to choose.
“No matter which definition you’re looking at; it’s all data. In other words, no matter how you look at it, you are dealing with something that as such is meaningless until you find meaning in it or give it meaning,” argues Greenberg.
“When you’re dealing with Big Data, you don’t want to deal with all of it, you want something from it and you have to figure out what it is you looking for. This is the key. Big Data is not Big Data to you. It is data from which you’re going to determine which set and subset that you want to use, which type you want to analyze, which source you want to generate the information from, so that you can begin to look at it in the way that gives you some insights.”
Big Data Opportunities
Since the amount of data being collected by companies has been growing exponentially and shows no sign of slowing down, it is a must for businesses to understand how to take advantage of these trillions of bytes of information.
A survey of 586 executives conducted in June 2011 by the Economist Intelligence Unit and sponsored by SAS, revealed that more than 50% of the companies that use data most effectively achieve higher financial performance than their peers. The survey also revealed that even though most companies today have data in abundance and readily available, more than 50 % of them only use half of their valuable data.
Many companies such as ING Direct or Xerox have already invested heavily in data analysis. For instance, ING Direct started a data-collection initiative to better understand how their customers think and what the best ways to interact with them is. Thus far, the bank has invested millions on data analysis.
Xerox now uses software in helping with the recruitment and hiring for its call-center jobs. Applicants are selected on the basis of their answers to a personality test and data analysis, rather than on their work history or interviews. By collecting data with powerful software, employers are now able to peer deeply into applicants’ personal lives and interests. Xerox is not the only company now outsourcing traditional HR functions to computers. McDonald’s, Lowe’s, Credit Suisse and Accenture are among those that now employ analysts to compile and compare data about their own employees to identify what precisely makes up a high-performer, and how to best replicate this performance in the workforce.
The Data Skeptics
Skeptics remain in the IT industry, citing Big Data as yet another hyped up buzzword designed to sell more software. However, Pierre Custeau, EVP of CRM Product Management at APTEAN, for one, is convincedthat while Big Data is not really as big as the hype that it has created, it definitely has a promising future. “After the hype will of course be a phase of disillusionment, but people will eventually realize that Big Data can be extremely valuable in getting closer to customers and driving an organization’s interactions with its customers towards favorable outcomes.”
Skeptical or not, one thing is sure: we live in a world that is more and more data-driven, and companies will have to find new ways not only of compiling this data, but also of making intelligent use of it. Analyzed and used right, data can help drive better marketing, improved customer relations and smarter business decisions, with a direct impact on the bottom line.