Big-data represents tremendous opportunity for establishing competitive advantage and, on the flip side, great potential for missed chances and colossal failure. On these I think we can all agree -- as we can that intelligent use of analytics will make all the difference.
Note here that I'm talking about the use of the analytics results, not the analytics techniques themselves (although sophisticated approaches certainly will help). My point being this: You can analyze data to death, but if the business isn't guiding your direction, and embracing and acting on your results, then you might as well not bother.
Given the state of information management today, we could well be headed for far more lost opportunity than success with big-data. At fault is the ever-troublesome disconnect between IT and the business -- more of an issue than ever in the face of the information explosion.
If you don't believe me, put your trust in the nation's premier IT research centers. As discussed in a recent MIT Sloan Management Review article, "Finding Value in the Information Explosion," 10 researchers set out to answer two questions of the age: How well are companies managing the data explosion and capitalizing on the opportunities it presents? And, to what extent are they extracting value from the data at their disposal?
To do so, they studied the data- and information-related activities at 26 US corporations and large nonprofits. These entities represented retail, healthcare, manufacturing, education, government, and other industry sectors. Annual revenue exceeded the $1 billion-plus mark at more than 80 percent of them.
The researchers, like many big-data watchers, expected that the data explosion "would allow companies to put more data in the hands of decision-makers at all levels of the organization." However, as a trio of writers explained in the MIT SMR piece, "generating business value from increased amounts of data is still an aspiration" at most organizations studied.
Here's their assessment:
Despite the buzz around “big data,” most organizations in our study were focused on the challenges of storing, protecting and accessing massive amounts of data, efforts for which IT is primarily responsible. But these organizations have not spent significant resources on the business opportunities possible with such data. Our research shows that while the IT unit is extremely competent at storing and protecting data, it cannot make key decisions that turn data into increased business value. Only a few CIOs and other IT executives reported that their organizations were succeeding at generating significant business value from their data.
And their recommendation: "Within organizations, business leaders must take the lead in making better use of data."
This doesn't mean IT is cut out of the picture. In fact, the researchers do suggest that IT can be the corporate data steward. But, they write, "business leaders must take responsibility for defining the data value proposition and delivering on it."
Jeanne Ross, director of MIT Sloan's Center for Information Systems Research, and one of the researchers, will join us tomorrow at 4:00 p.m. ET for a conversation about the information explosion and how companies can gain value from it. You can read more about the study here and join in the live e-chat here.
Whether you fall under the IT, analytics, or business umbrella, don't miss this opportunity to discuss the big-data challenge with this academic thought leader. Join us tomorrow!
This raises again the question of how IT role should be redefined in the enterprise
This is a very, very valid point. Who owns the analytics function in an enterprise? Thats a tough one for IT to figure out, given that some companies are still struggling with social networks, and defining parameters as to who owns what.
Broadway, don't you think it takes a blend of multiple disciples -- IT, statisticians, etc --to really make analytics a successful part of a company?
By any title, there is a shortage of talent.
According to McKinsey Global Institute, the US could be facing a shortage of 190,000 people with analytical skills by 2018. McKinsey isn't the only organization that's spotted a potential shortfall of data scientists. In a separate study of 500 data scientists and BI professionals, EMC discovered that 65% of the respondents expect demand for data scientists to outstrip availability over the next five years. Moreover, 83% of respondents believe that new tools and emerging technologies will exacerbate the demand for data scientists.
Sorry, I still cannot be convinced that analytics is under the IT jurisdiction. It makes sense why IT would want it to be ... because any bureaucracy craves more reason for being ... but what we need are not technicians and technologists, rather statisticians and strategists.
You can righly call it resistance to change or the ruling of the dinausors in the enterprise, but I rather think it is because we haven't quite been able to make sense of the data yet. We should first try to build tools that will help in the pre-processing and visualization of the data, before thinking about building the final models. This implies removing noise, extracting good features and choosing the right algorithms.
"IT.. cannot make key decisions that turn data into increased business value."
This raises again the question of how IT role should be redefined in the enterprise and how IT training should change to fit current market needs in this era of information explosion (I like this term). The new IT guy needs to learn how to securely handle the data as well as how to process it and derive effective business value from it. Apparently, we haven't understood how to do that, yet.
@Cordell -- right, right, right! I know, easier said than done. Change is hard, as you say. And let's not forget how complicated things can get when egos get in the way!
Hi Jenn. What are the chances companies can get this right at this juncture? If so much of existing data gets ignored or misused, aren't we only exacerbating the situation with big-data content types and volume? Some companies do teamwork well, and benefit from it, which leaves me always wondering why the heck it's taking the vast majority of others to get on the ball!
Of Course! Those that are inefective and the examples everyone looks to--to prove that data is inneffective--are those companies that only seem to use their data as "FILL FILES" for their in house servers. It's a great way of saying "Look at all our data, and we still can't figure it out."
Randy Bartlett, author and seasoned analytics professional, will join us this Friday, May 17, at 2:00 p.m. ET for a radio show on ensuring organizational change for the good of business analytics.
LEADERS FROM THE BUSINESS AND IT COMMUNITIES DUEL OVER CRITICAL TECHNOLOGY ISSUES
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