Idea Transcript
PROACTIVE ADOPTER SERIES:
Turning big data into business insights
In today’s new technology landscape, what separates proactive adopters from other small and midsize businesses (SMBs)? It all comes down to how they’ve approached cutting-edge technologies, such as security, mobility, big data, and cloud. We’re covering all four of these trends in our proactive adopter series, including the different motivators and objectives that are driving businesses to adopt. Security, for example, is vital to protecting data and preventing harmful breaches; mobility allows employees to access data and work from anywhere, on any device, at any time; and new cloud-based solutions and strategies assist in storing, managing, and backing up any and all collected data. Clearly, data—and specifically big data—is interconnected with all three of these factors. But what exactly is big data? How can you collect and harness it, and how can using the proper tools to analyze this data impact your business?
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PROACTIVE ADOPTER SERIES: TURNING BIG DATA INTO BUSINESS INSIGHTS
It’s easy to think that if you knew just one vital piece of information or followed a particular path, then you could better compete in the market, acquire and retain more customers, and increase productivity, essentially becoming a leader in technology trends in your industry. This makes sense in theory, but simply having the right information when you need it is more difficult than it sounds. Understanding what that data means and how to use it can be even trickier. PRIORITIES OF PROACTIVE ADOPTERS
45%
Innovate to stay ahead of the competition
44%
Respond quickly to changing business requirements
43%
Manage company growth
43%
Launch new products/services or move into new markets
Mining big data isn’t a luxury reserved for large businesses with the budgets and teams to match its scale. Today, small and midsize businesses can also benefit from big data and data-driven decision-making, and they can do so without having deep pockets. Big data analysis allows a data-driven business to capture and use information to make decisions, enabling it to grow and accomplish the goals of any forwardthinking business. A proactive adopter, like most organizations, desires greater IT alignment with their business and better outcomes leading to improved profitability and lower IT costs, and big data analysis can help achieve these goals. A recent Hewlett Packard Enterprise (HPE) survey, fielded by Coleman Parkes, asked 1,500 SMB decision-makers around the world about how they’re implementing big data in their organizations. The respondents were broken down into three adopter profiles: basic, moderate, and proactive. While each profile has its own motivators and objectives when it comes to adoption, the top three motivators driving proactive adopters to implement big data initiatives include:
1. Improving profitability 2. Aligning IT with business units 3. Focusing on better business outcomes In turn, the key business outcomes proactive adopters expect to get from big data include innovating to stay ahead of the competition (45 percent), responding quickly to changing business requirements (44 percent), managing company growth (43 percent), and launching new products/services or moving into new markets (43 percent). Over half of the responding organizations were already engaged with big data in one way or another. The most proactive among these organizations tend to embrace change and strive for growth. Proactive small and midsize businesses almost immediately recognize that business data, business intelligence tools, and big data insights can help them compete in the market and improve profitability. For instance, one survey respondent reported an improved ability to use data to form specific strategies to develop their business. Of course, this is exactly what data-driven organizations do all the time.
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PROACTIVE ADOPTER SERIES: TURNING BIG DATA INTO BUSINESS INSIGHTS
Defining the “big” in big data So, what is big data? First, “big” doesn’t refer to the size of businesses that can use it; it refers to the number of sources producing and generating data and the many multifaceted means for delivering business outcomes. The other side of the equation, “data,” is about capturing and using the right data, whatever its size, to advance your business. We’re not talking about terabytes or petabytes of information. Gigabytes, and even megabytes of data, can deliver valuable business insights.
Data can come from both in-house and external sources. Surprisingly, the most valuable data you have may be sitting right under your nose: your own data within your own systems. One survey respondent reported using primarily internal data, which led them to combining traditional data sources, such as resource planning management and customer engagement management, with other data to find new insights. Don’t stop there though, as there is a lot of data easily available and free outside the business, including government census data, industry and trade association information, colleges and university research studies, and more. Wherever your data comes from, it will likely have three attributes, considered the three Vs of big data: volume, variety, and velocity. The three Vs refer to different ways to characterize the “big” in big data. From the standpoint of SMBs, the emphasis should be less on the bigness of the data and more on the quality of the data—what it is, what insights you can extract from it, and how you can use it to advance your business goals. Volume refers to the amount of data. Whether it’s a great volume of data or a decidedly small amount, it’s important to remember that it’s not the sheer volume of data that matters, but the insights and valuable information derived. SMBs don’t usually encounter extremely high volumes of data, but it is possible. For instance, if you’re incorporating weather data as part of a
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PROACTIVE ADOPTER SERIES: TURNING BIG DATA INTO BUSINESS INSIGHTS
supply change management application, then you could easily encounter a high volume of data, in the range of terabytes to even a petabyte or more. In that case, you want to have the network and server capacity to handle it.
BIG DATA ANALYSIS ADOPTION RATE
Proactive 55%
fully adopted
Moderate 19%
fully adopted
Basic 2%
fully adopted
Variety refers to the different types of data, including structured or unstructured. Almost anything digital—including email, docs, log files, spreadsheets, tweets, social media posts, call center records, or almost anything captured on a digital device—can count as a different variety of data. Just think about the types of data that might go into a customer relationship management (CRM) application. It could include transaction data as it captures a history of the customer’s transactions, but it might also include maps to the customer’s various locations, unstructured text data culled from different social media sites capturing comments and opinions about your brand, and even your call center logs capturing the customer’s support sessions handled by the call center. Looking at it all, you’ll notice it presents a surprising variety of different data and data types. Velocity refers to the speed at which data arrives. You need to know the speed of the data to understand what it means and what to do with it for the best business results. Looking back at the previous two examples, you’ll notice opportunities for weather data that may stream in at real time and for social media data that can arrive in near real time. Meanwhile, conventional structured data from your various transaction and management systems will arrive at their normal pace, maybe within a few hours or possibly overnight, following a batch processing run. Notice that not all data arrives immediately. Still, you need to recognize the velocity at which each data set arrives so you can plan your data analytics appropriately. Remember, it’s through those analytics that you get the payback from big data. Some people add a fourth factor for veracity, referring to the accuracy of the data. Data-driven businesses truly appreciate the principle of garbage in, garbage out (GIGO). Clean, accurate data should be the starting point for any data-driven strategy. Unlike the previous three Vs of big data, veracity does not address any aspect of “big” in big data; it really addresses the accuracy aspect of the data’s quality, which is paramount if the results of any data analysis are to be worthwhile. No matter which factor you’re talking about, improving profitability is a prime motivator among the majority of small and midsize businesses for implementing a data-driven strategy. According to the HPE survey, respondents varied regarding how they’re embracing data initiatives. Sixty percent of SMBs have fully or partially adopted data-driven initiatives, and one-quarter are planning to adopt in the next year. Alternatively, 16 percent of small and midsize businesses are following a slower adoption timetable or have no plans to pursue a data-driven strategy.
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PROACTIVE ADOPTER SERIES: TURNING BIG DATA INTO BUSINESS INSIGHTS
Turning data into business insights
“Data analysis enabled us to really understand the popularity of certain products, so we knew where to focus efforts.” IT DECISION-MAKER, MANUFACTURING, EMEA REGION
TOP MOTIVATORS FOR ADOPTERS 1. Improve business profitibility 2. Better align IT with business units 3. Better business outcomes
Capturing and collecting data is just the start. Next, you need to turn it into useful business information and insights. There are a variety of analytical tools and techniques that can help transform your data into insights to drive competitive advantage. But before you can reap the rewards of a data-driven strategy, you will need to be ready to act on the insights you turn up, and the organization needs to be prepared to change, if necessary. Forward-thinking small and midsize businesses are reporting great success with this type of data-driven approach. One survey respondent noted they are now able to collect data from client campaigns and directly compare them with previous campaigns and competitors. This helps support future customer engagement by delivering credible business insights. Another organization said big data lets them analyze market trends to respond faster and better.
Big data motivators and objectives As previously noted, the top three motivators propelling proactive small and midsize businesses to adopt big data initiatives are to improve profitability, better align IT with business units, and focus on better business outcomes. In addition, the HPE survey found the main drivers for all SMBs are customer insights, product improvement, and customer retention. Implementing big data insights can lead to positive outcomes that address these motivators. For example, by identifying customers’ and prospects’ needs, businesses can deliver products attuned to their customers’ interests by creating innovative solutions and accurately focusing their efforts at the same time. The upshot? More sales, greater business growth, and clearer competitive advantages. As one proactive IT decision-maker in manufacturing from the Europe, Middle East, and Africa (EMEA) region noted, “Data analysis enabled us to really understand the popularity of certain products, so we knew where to focus efforts.” For other survey respondents, one desired outcome of big data is to improve profitability, mainly by focusing on the areas and activities with the best potential. It might seem obvious, but without having the data and analysis to corroborate your gut impulses, those areas of potential may not be apparent. As one business stated, “We are able to analyze a lot of stock keeping units to determine the optimal prices to maximize profits and minimize inventory, and adding this gives our business a competitive edge, reduces costs, and improves our bottom line.”
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PROACTIVE ADOPTER SERIES: TURNING BIG DATA INTO BUSINESS INSIGHTS
Start by asking questions
Analytical technologies help to transform big data into a competitive advantage.
PROACTIVE ADOPTERS • Leading visionaries who embrace change • Agile and innovative
• Willing to take risks to grow and stay ahead of competition
MODERATE ADOPTERS • Implement when the business is ready • Thoughtful and conservative with IT investments • Address growth tactically vs. strategically
The key to success is putting big data and analytics at the heart of your business, and to do this, you’ll need to make it part of every business decision and strategy. Look beyond the hype; it’s not only about data, analytics, and technology, but about fostering innovation and understanding your customers and their buying habits. This requires finding what differentiates you from other companies, and big data provides the key. Here are a few steps to get started: • Start by asking a basic business question. It can be as simple as what problems the sales or support teams are encountering with a new product, or who are your customers? What are they looking to buy and why? • From there, form a hypothesis as to the answer. For example, maybe a new feature set is confusing sales reps or customers, preventing them from using the site with ease to purchase what they want, when they want. • Next, create a plan to prove or disprove your hypothesis. This typically revolves around what data you will need to confirm or disprove your hypothesis. Should your hypothesis be disproved, formulate a new one. • At this point, begin to collect and review the data, starting with what you already have in-house and augmenting as necessary with outside data. Now you’re ready to generate insights based on what you see in the data. In most cases, this entails nothing more elaborate than classifying, comparing, sifting, and correlating the data. Look for patterns or elements that seem out of place compared to the rest of the data. • Finally, make specific action recommendations based on the insights gleaned. For example, if the problem is confusion around a complicated new feature set, your recommendation may involve ways to better clarify or present the new features. If your sales reps or customers report the changes to be helpful and that they allow them to conveniently buy what they want, the solutions proposed were successful. If not, reevaluate and start from the beginning.
BASIC ADOPTERS • Cautiously consider IT decisions • Rely on guidance from service providers • Risk averse, react to specific needs as they arise
Today, everyone can have a share of the big data pie, and you, too, can have these kinds of results. By approaching data as a business decision that can benefit your organization in numerous ways, you can begin harnessing the power of information and establishing a competitive advantage in your industry.
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PROACTIVE ADOPTER SERIES: TURNING BIG DATA INTO BUSINESS INSIGHTS