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Research: Most companies baffled by Big Data

This is a contributed piece by Jerome Buvat, Global head of research at Capgemini Consulting

The image conjured up by new research from Capgemini Consulting on Big Data is one of multiple organizations floating on a sea of information, unable to hook the big fish.

Cracking the Data Conundrum: How Successful Companies Make Big Data Operational”, shows that despite global spend of more than $31 billion in 2013 and nearly 60% of executives convinced of its disruptive potential -  most organisations have not fully embraced Big Data, with ineffectual operating models and a lack of expertise preventing most from monetising Big Data.

Regardless of initial investment and intention, only 13% of organisations in the survey say they have actually achieved full-scale production of anything useful. Less than a third would describe their initiatives as ‘successful’, falling to just 8% who would term them ‘very successful’.

The biggest cause of failure cited was scattered data lying in silos across various departments and ineffective coordination between teams dealing with it. Harnessing Big Data depends on adopting new ways of working across the entire organisation, with understanding from top to bottom of new methods and the reasoning behind the change.

Success depends not only on a clear and well-implemented operating model underpinned by up-to-date software, but staff trained in new skills, the encouragement by internal champions and determined leadership to steer the ship.

The report shows that companies that drive their Big Data initiatives through a senior manager such as a Chief Data Officer do better than those without leadership support, and also that success rates for those with a dedicated analytics business unit that shares methodology, information and best practice across the organisation are nearly 2.5 times those working with disconnected teams.

A centralized approach that brings together different departments such as IT, engineering and finance encourages essential collaboration across project teams and allows those with vital skills to make operating models work and communicate best practice to other teams.

The research also reveals that a systematic and structured approach to implementation is rare. 67% of companies did not have clearly defined KPIs to assess initiatives. The lack of a systematic approach affects success rates. For instance, 51% of initiatives that have well-defined KPIs are successful against only 28% for those that do not.

The problem for many businesses is a lack of expertise to make the new model work. Four out of five data-intensive businesses say they are struggling to find the skills they need to address growing demand. Partnering with other organisations that already have specific expertise, particularly Big Data startups, can help traditional organisations accelerate their own strategy, illustrated by Tesco’s growth after acquiring consumer data science firm Dunnhumby in 2006, and consumables giant P&G using Google to improve employees’ analytical skills.

A further challenge is that more data invariably means more risk of cybercrime such as identity theft and hacking. Not only do organisations need to set up strong safeguards to manage and control their own risk, but in an increasingly consumer-led business environment, there’s little point having swathes of in-depth knowledge if your customers don’t trust you to use it. Opt-in/opt-out mechanisms and the possibility of anonymizing data before use give customers some control over what they hand over and reassure them that their privacy is protected.

It’s clear that most businesses understand the potential impact of Big Data, brought home by the runaway success of leaders such as Amazon rewriting the rules of business. The challenge to securing the value is overcoming the inhibitors that threaten to drown the progress of new initiatives.

Capgemini Consulting’s report shows that Big Data will only realise its potential when the operational building blocks – strong leadership together with a cohesive operating model - have been carved out, put in place, and accepted by the organisation.

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