We are in the midst of a “Big Data” revolution. But there is so much hype around this buzzword that it has become what I call a lemmings market: Every tech company on the planet now claims to have a solution for analyzing the mammoth amount of data businesses generate—and need to collect. No wonder top managements find it so difficult to figure out exactly what their companies should do about this trend.
The big deal about big data is that it offers the ability to take huge volumes of data and pick out the important patterns and trends—without having to know the right questions to ask. This is key because the amount of information companies must deal with has grown exponentially and changed in unprecedented ways: Data now come from social networks, images, sensors on all sorts of equipment, and the myriad systems that keep track of Web transactions from supply chain management to consumer sales—to name just a few.
In decades past, information was organized, or “structured,” in a database so managers could get reports about the state of their business by asking such straightforward questions as, “What were last year’s sales by region?” If you didn’t know what to ask, or phrased the request improperly, good luck getting something meaningful.
Enter the big data era. Imagine you’re a retailer and want to plan your strategy for the coming year. Of course you need to understand what products sold well last year. But that’s not enough to give you a competitive edge these days. A smart retailer will make use of all the information relevant to the business—sales data, chatter on social networking sites, information from partners and suppliers, as well as publicly available data. Understanding all this information can mean the difference between anticipating an issue before it can derail sales and explaining why you missed your sales target.
This unstructured data (without a defined structure such as text, images, videos, etc., that you will not find in a traditional database), much of it generated by the Web, is growing in importance to how businesses will compete in the coming decades. But there is no simple way to get at the essence of what this amalgamation of sources can mean. That is why managers must be skeptical and make sure the technology and companies offering solutions are not simply relabeling a traditional product as a big data solution. The real thing is emerging and will be an essential business tool.
How can you recognize the real thing? It may not be easy, but here three questions to ask:
• Can the product easily handle huge volumes and a variety of types of data in real time or near real time?
• Has the same product been available for a few years under a different name? A little detective work will turn up the answer.
• Who are the innovative technologists responsible for the product, and what is their experience?