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Everyone is talking about Big Data. And rightfully so: thanks to the latest digital developments, businesses can now capture, store and manage massive volumes of data from a wide range of internal and external sources. This allows companies much easier access to a rich set of information about customers, suppliers and competitors, than ever before.
Eating the data elephant
But without the proper systems and processes to turn Big Data into Big Value, many organisations are now finding themselves drowning in the data deluge. Indeed, by some estimates, more than a zettabyte (that’s a 1 followed by 21 zeroes) of information now circulates around the internet. What’s more, around 90 percent of the world’s current data has been created in the last two years alone, indicating that the volume of data about to be unleashed will make organisations’ current data challenges seem like simple arithmetic.
In part, the solution to the growing Big Data challenge requires organisations to stop fighting the ‘data arms race’ – gathering more insight on past, present and future customers than their peers –and start focusing their efforts on aligning their analytics capabilities to support the objectives of the business. The simple truth is that, for most organisations, the data arms race has already been lost; thanks to the world of social media, organisations such as Amazon, Google and Facebook already know more about most companies’ customers than they do themselves.
Indeed, the problem now facing business executives is not how to gather more data, but rather how to turn the data that already exists into meaningful business intelligence that can drive business decision making. But navigating that path is often easier said than done.
Putting on the blinkers
Typically, C-level executives continue to scream for more and more data, believing it to be the panacea for all business ills. Meanwhile, further down the organisation, middle management is often actively inhibiting change around data management. This is happening because information has historically been the very stuff that underpinned their power base.
But in today’s business environment, power actually comes from what you do with that vast pool of composite knowledge, not how much of it you control. Rather than simply chasing more data, business executives will now need to be crystal clear about which data-driven processes are actually fundamental to the business and the way it operates, and then focus on that data. The fact is that not all data is business-critical – some is utterly useless – and understanding and channelling the valuable data from the detritus will be a key challenge for organisations going forward.
Moreover, executives must recognise that data management and governance is often more important in a business’ target operating model than the process itself. Ultimately, executives will find that controlling enterprise risk and managing regulation will largely depend on their organisation’s ability to identify their sources of verifiable and valuable information, convert it into actionable insights and then use the results to drive business results.
Getting fit for the fight
This will invariably require organisations to invest resources and executive attention towards some of the key Big Data challenges such as identifying and securing the right mix of skills and capabilities to turn data into value. In fact, according to analysts, businesses are now facing a yawning gap between demand and capability that – in the US alone – will require some 1.5m data-savvy managers and analysts to fill. In other words, those that hope to convert their data into business value must first start by identifying and securing sufficient and experienced resources to dig out from the data avalanche.
Executives will need to take a lead role in this: they must help identify the objectives that matter most to the organisation, define the key performance indicators and then place the appropriate investment into developing their analytics capabilities to deliver true and lasting value to the organisation.
At the end of the day, the organisations that will win the real data race will be those who are able to stop gathering information and instead start spending more time understanding the data they already possess. Being prepared to ask ‘why’ rather than spending time demanding to know ‘more’ will ensure that genuine insights can be gleaned and followed up.
Bryan Cruickshank is global head of IT advisory at KPMG. Eddie Short is also with KPMG in the UK