Australia might be at the end of the mining boom, but it’s just kicking off the data mining boom. Big data is going to be a truly hot topic in 2014, with IDC predicting that spend on big data technologies worldwide will grow by 30 per cent over the next year. Interest in big data, and other what IDC calls “third-platform technologies” such as cloud, mobile, and social networking, will account for 89 per cent of the growth that will see total global IT spend top $2.1 trillion in 2014.
What’s most exciting about big data is that many organisations are not even coming close to utilising data to its fullest extent. As we move into 2014 big data is going to only grow as an opportunity for competitive advantage, but it first must address five key challenges that has been holding back its growth.
Big data will need to overcome the data challenges of business units outside of IT – The current idea that big data is solely the responsibility of the IT teams is one that organisations need to push out of the business in 2014. As Gartner’s prediction states; by the end of the decade technology spending outside of the IT department will become 90 per cent of total spend. Big data will be a major driver of that, as it offers clear and definable value to all parts of the business. To keep on top of the trend, organisations will want to work on educating different teams within the business on how to draw meaningful insights from big data and then execute on them.
Big data will mandate that IT becomes part of all business units – Aside from enabling an organisations’ business units to access data, in 2014 we will see big data become a core part of those business unit’s functions, and as a result require IT staff of their own. Gartner’s prediction that more IT spend will be made in business units outside of IT than within the IT team will also start to come true here as these other business units start to recruit IT staff of their own.
Big data will need to start justifying itself via a business case – Most organisations are collecting data right now, but they’re not necessarily doing enough with it to articulate the value around it. In 2014 it will become more important for businesses to make a strong business case around the data they’re collecting in order to justify continued investment in big data solutions.
Big data has three unique selling points – volume, velocity, and variety. These three ‘V’s can be linked to a fourth – value, which occurs when business value is linked into each of the other ‘V’s. In other words, in 2014 the business case for big data will involve the collection of data on customer’s devices, preferences, activities, locations, and interests, and this data will be analysed in real time to ensure a positive customer experience. The velocity is critical because the value of information decreases sharply a short period after it’s gathered. It’s impossible to make an effective business case for big data without meeting each of these selling points, so much of the focus in 2014 for businesses needs to be on linking the three ‘V’s to find value for the organisation.
Big data will need to do more than manage social media – A lot of the energy around big data in 2013 and years past has been around social media; gathering interactions and using it to better target customers with tailored content. But there is much more to be done. How many retailers are making use of data gathering to understand how customers are moving through their isles, for instance? In 2014 we can expect to see big data’s role move well beyond social media for the innovative companies out there.
Big data will need to become more integrated with risk management practices – There are still too many instances of big data-based marketing campaigns backfiring and causing lasting damage to organisations and brands. For one example – Target’s now-famous marketing email that predicted a woman’s pregnancy before she had told her parents. A more recent example of a social campaign gone wrong was JP Morgan’s initiative to run a Twitter Q & A with the bank’s Vice Chairman, Jimmy Lee. Misunderstanding its social media profile entirely, the initiative drew over 6000 very angry tweets from consumers and JP Morgan was forced to cancel the Q & A. Big data can be used to measure community attitudes and assess risk profiles of marketing activities, and in 2014 it will be more important than ever for organisations to include the big data analytics as part of any due diligence process.
Big data is going to be an exciting field in 2014 and it’s the smart and innovative businesses that will turn to big data to find numerous opportunities for competitive advantage. If anything, 2014 will see, for the first time, big data utilised to its fullest capabilities.
Tristan Sternson is Managing Director of InfoReady.