Much of today’s euphoria over Big Data and analytics is well-deserved. The availability of large volumes of rich, high-quality source data is opening new avenues to better understand customers, markets and operations. As these emerging technologies continue to race ahead, there is an unprecedented opportunity to harvest those data streams and generate incredible new insights. However, while those insights are a critical first step, they are far from sufficient in guaranteeing a lasting, sustainable advantage for any firm. Only through the conversion of new insights into realized value can a firm truly capitalize on the promise of Big Data.
This is why: organizations tend to follow a familiar pattern. First, a small, targeted pilot shows initial promise and generates a few “ah-ha” moments. With this success, businesses often rush into gathering and storing every last bit of data they can capture, convincing themselves that there must be something valuable contained within. The creation of “data lakes” and extensive “skimming” operations has only achieved limited success because of the lack of availability of skilled staff, tools and analytical methods. Ultimately, firms will hit a problem of moving and storing so much data, which in turn compounds the problem.
An alternative to this notion is the purpose-driven analytical strategy, where firms first identify their needs, and then derive the ultimate source of data they need to improve their business. As Jack Welch famously stated, “start with the answer” and let that channel your efforts. The reward is a guarantee that your initial data gathering will have a direct impact on your firm’s success. In this slideshow, Tom Fountain, CTO of Pneuron, has identified five steps organizations can use to drive analytics with a purpose.
Five Steps to Drive Analytics with a Purpose
Click through for five steps organizations can use to drive analytics with a purpose, as identified by Tom Fountain, CTO of Pneuron.
Characterize Your Business Needs
It is crucial to understand the needs of the business before setting out on an analytics strategy. Seek out the visionaries and strategists who guide your firm forward and gain a firsthand understanding of the processes, decisions and actions that are critical to competitiveness.
With that context, your next step is to actively decompose these elements into their core components – the inputs, value-added processing and outputs required. By scoring their relative worth and sorting that list, you are armed with a value-driven “targeting list” that will guide your investment strategy.
Take Inventory of Data, Information and Knowledge Assets
It is paramount to take inventory of your existing assets to discover where there are gaps in the targeting list you have built. It is important to distinguish clearly between raw data, processed information and derived knowledge, as each have very different cost, governance and timeliness dynamics. Ensuring your understanding of the full lifecycle of these assets will inform your decisions about building or buying new assets, the scalability of “production” and the skills required to acquire and manage the necessary resources.
Use ‘As-a-Service’ Offerings to Fill Key Gaps
Inevitably you will find gaps between your current capabilities and those demanded for long-term success. Before taking big bets that may lock you into the wrong path, look for temporary solutions that will allow a flexible, low cost and very agile opportunity to experiment with. The wealth of “as-a-service” offerings in the marketplace has opened up very creative options for firms to rapidly assess different combinations of internal capabilities and external data services, analytics and applications.
Use ‘End-to-End’ Prototyping to Validate Value Potential
As with all new technologies, unbridled optimism eventually faces the expectation of discipline and realized value. In many firms, the CFO has begun to close the window on investments that cannot demonstrate a solid expected return. In response, many firms are creating “end-to-end” prototypes that capture the entire flow from data capture, processing and deployment to operations. Armed with an understanding of precisely how value will be realized, strategists and technologists can make a strong case for investment.
One thing is clear – markets, customers and technology will not stand still. Vigilance is required to maintain optimized operations in the face of change. A firm must consciously devote time and energy to re-assess – and in some cases re-deploy – solutions that were deemed satisfactory in the present circumstances. Firms that read the trends and derive insight around how value creation needs to change will be best positioned to navigate the waters successfully.