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What Big Data Brings to Decision-Making Strategies
Posted on June 2nd 2014
Potentially valuable and relevant "big data" is generated everywhere as wellsprings for new intelligence processes. But big data is only valuable if it can be used to answer business questions and offer new insights for business goals and future direction. While a lot of attention for big data has been focused on technologies that can process and analyze it, big data only matters if an organization knows what to do with it. When considering the value of big data from a strategic perspective, it's usually more important to focus on the ends, not the means, of what big data can provide.
Big data analytics can and should be part of executive-level efforts for building out overall corporate strategy, for uncovering new business opportunities and innovative direction, and for expanding decision-making processes. Organizations that are still trying to figure out what big data could do for them frequently fall into the trap of thinking that big data analytics are solely a technology initiative that belongs to IT. Often big data projects need strong and constant senior management involvement to succeed. The challenge for senior executives is to understand all of the implications of becoming a data-focused organization, particularly where big data plays an integral part, and then to put that understanding into action.
Getting into the habit of asking the right questions when working with analytics of any kind is an essential activity for strategic management:
What is the ultimate reward? – What is the organization trying to achieve with big data analytics? Opportunities may range from creating new lines of business or business models, to improving core operations.
Do you understand your big data process? – Are you letting the data tell you something new, leading you to new areas of innovation? – Or are you focusing on finding answers to specific questions?
Are you willing to embrace new business models or modes of competing, if all possibilities can be tested and analyzed? Big data analytics using commodity hardware opens the door to expanded ways of testing various propositions, especially 'offbeat' and cutting edge notions.
Are you considering the impact of big data initiatives for the overall organization? What actions does the senior team need to take to enable the cross-functional teams and collaborations that will be needed to support big data initiatives? Frequently big data processes cut across organizational boundaries-- yet internal politics can throw up roadblocks.
Is the value achieved worth the cost? Consider big data initiatives in the context of other strategic priorities; then compare the costs of each, and identify which are most likely to contribute to performance improvements and business outcomes, with the most balanced cost.
Big data initiatives are the most successful when upper management enables and nurtures a data-savvy organization that can act quickly on the results of the analytics, when it makes sense to do so. A significant benefit from big data initiatives may be the transformation of how the organization operates internally, conducts business externally, and fulfills the needs and desires of customers.
This post was written as part of the IBM for Midsize Business program, which provides midsize businesses with the tools, expertise and solutions they need to become engines of a smarter planet. I've been compensated to contribute to this program, but the opinions expressed in this post are my own and don't necessarily represent IBM's positions, strategies or opinions.