Global economic uncertainties are motivating companies everywhere to look hard at eliminating unwanted costs from their business. Every part of a business must now contribute to the overall well-being of the whole, or risk being outsourced at best, or simply cut at worst.
IT departments are taking their share of the heat. Recent research by analyst firm IDC on behalf of Hitachi Data Systems reveals some of the primary concerns CIOs have as they formulate an appropriate IT strategy for current market conditions.
The outstanding concern for 56% of senior level IT professionals from major European corporations was how to align IT costs to business budgets. Another important source of stress was the rapid growth of data, cited by 41% as a prime worry.
Compare these results with the relatively lower concerns of data center space shortage, which worried only 24% of CIOs. Or compare it with the environmental impact of IT strategy, which bothered a mere 18%.
Many CIOs clearly feel motivated to reduce the financial burden of their department on the whole corporation, to support the business’s central strategic aims, and to help drive business innovation. They believe these goals must be achieved while also keeping under control the continually growing volumes of data.
But is there a better strategy? Some organisations, reveals IDC, now focus on actually driving value directly from their stockpile of corporate information, making that information work for the business. For now, these innovators are a minority.
It’s time to think more broadly. There’s an excellent argument for not viewing data as a burden, threat, cost, or unwanted by-product of other activities. The example of some forward thinking IT departments shows that data can actually be considered part of a company’s output, and therefore, part of the company’s overall value.
We are accustomed to using metrics like financial capital and human capital when measuring an organisation’s worth. Or we may choose something less easy to quantify but equally important, like the value of its brand. Now it’s time to consider value of a different kind – the value of the data an organisation already has.
Recognising the value of data is important because it can be used to create business efficiencies, to stimulate commercial success, and to improve business processes and customer service. Data can be used to encourage the activities of brand advocates, to fuel business innovation, and to generate ideas for R&D that will lay the foundation for the next wave of company growth.
Organisations across all vertical sectors around the world face a well-publicised deluge of so-called big data. But companies that are powered by their big data have on average higher productivity and enjoy greater profitability than companies that view data as a largely unwanted responsibility and liability.
So how far off are we from the era of deploying big data to positive ends and actually using it for business insights and advantages? Well, pretty far. IDC found that only 10% of senior level IT professionals have already started on this process. Some 20% have the good intention of starting in the next 24 months.
Another 10% flatly reject the need to do so. But the majority, nearly 60%, simply have no current plans. They are watching, perhaps, to see where the example of the front runners might lead. Or perhaps they are simply hesitating.
So what’s holding them up? IDC found that many CIOs worry about the cost of big data deployment and find it hard to budget for. They also struggle to list the exact business benefits or measure the all-important return on investment of a big data deployment strategy.
Competing with data
Inaction is not a useful choice. The business advantages in using big data are available to your competitors as well. The tipping point, where the value gained from an enterprise’s data outweighs the cost of extracting and managing it, is already here. So let’s recognise that as a positive development, and act today.
Big data deployment can start small. As a first step, look across your business for possible cases that might deliver early returns and start there. It is probable that optimising existing processes will yield a relatively clear ROI. The next stage is to cast the net wider and objectively evaluate the business value from each source of data in the business so that you can identify new opportunities made possible by big data deployment.
Once an identifiable value for data has been established, it should motivate business leaders to re-evaluate all data. After this analysis, they will start to value the storage and management of that data as an essential business activity.
Exploiting big data requires proper data management before your data starts to show its true business value. A more strategic approach to your data will allow better use of your data and let it perform better for the business.
There’s no question that organisations with better storage strategies – that can capture it efficiently and mine it well in the first place – find it easiest to unlock equity from that data. These are the organisations that find it easiest to improve their business efficiency, performance, customer service, and competitiveness.