Big data for small business: Levelling the playing field
Guest blog by Dave King
Editor for Information Technology Advisor
The phenomenon that is “Big Data” is already having a huge impact on your organisation – only you might not have noticed it yet.
Big data is the accumulated data your organisation has collected and usually stored – structured and unstructured data such as text, sensor data, audio, video, click streams, log files, and more. Many companies are finding enormous value through analysing these various data sets against and with each other.
The evolution of the Internet and the influence of mobile devices, wireless networking, sensors, and social networks have changed operations and how businesses compete. But all these tech trends are bit players compared with Big Data.
While Big Data is the engine that’s driving companies such as Facebook, Twitter and Amazon, it’s relevant for small and mid-size businesses (SMBs) too. Big Data has already had a significant impact on how large businesses operate, and technology analysts believe it will be even more important to SMB operations in coming years.
Here’s what you’ll need to know to get ready for it.
How much is too much?
Data is growing at a furious pace in every business.
Every day, 2.5 quintillion bytes of data is created, say the folks at tech behemoth IBM. Data is accumulating so rapidly, that much that 90 percent of the data in the world today has been created in the last 2 years alone.
This data comes from a wide variety of sources: posts to social media sites, digital pictures and videos, purchase transaction records, cell phone GPS signals, and sensors used to gather climate information, just to name a few.
The annual growth rate of data is 40 percent, and by the year 2020, it’s estimated that 35 zettabytes will be stored in the world.
Just to get an idea of how fast and furious this pace of data generation is, consider that Facebook generates 10 terabytes of data a day, while Twitter contributes 7 terabytes a day. And this is just the social networking data we’re talking about. Most businesses are generating their own data, as well.
With all this data accumulating so quickly, businesses will need to make use of it or waste space just holding onto it.
Is this mammoth amount of information too much to manage? Does it take a huge organisation with wickedly deep pockets to use it?
Intuit, provider of business and financial management software for small and mid-sized businesses, and Emergent Research, a leading survey and research organization, have issued a new report that predicts advanced analytics will soon become the tool of everyday users.
They predict data will be the key driver of economic growth in the 21st century digital economy, having an enormous impact on business, science, health care, finance, government, and entertainment.
This data can be used to personalise marketing, predict labour and materials needs, or structure products (such as creating car insurance policies tailored to the driving habits and auto uses of individual customers).
And Big Data analytics, say analysts, may in fact hold the greatest promise for SMBs. Intuit CEO Brad Smith says analytics will enable a new “data democracy” that will help SMB owners and customers use data as effectively as the big guys. Armed with insights and capabilities once only available to corporate giants, small businesses will be able to operate more efficiently, find new customers, improve their bottom-line results, and drive economic growth.
With this new level playing field, SMBs are less likely to be swamped by large organisations. By using data analysis, a small business could be more effective at targeting potential customers who are more easily served and reached, instead of using a scatter-shot approach that wastes time and resources.
Saving time and money
The report says that over the next 5-7 years, emerging technologies and new analytical tools will convert daunting data streams into actionable information. That will ease personal decision making, reduce uncertainty, and save individuals both time and money.
A 2011 McKinsey report suggests suitable technologies for big data include A/B testing, cluster analysis, crowdsourcing, data fusion and integration, machine learning, natural language processing, pattern recognition, anomaly detection, predictive modeling, sentiment analysis, time series analysis, and visualisation.
“These analytical tools will store, organise and analyse life’s data feeds for us, aggregating anonymous information from large numbers of people to provide individuals with personalised comparisons and insights,” the report adds. “Used on their own or in conjunction with advisers such as accountants, financial planners and health specialists, these data driven tools will demystify the complexity associated with the business of life.”
For businesses, Smith believes that digital data will help spark a return to the era when neighbourhood merchants knew their customers and could anticipate their needs.
Developing the data analyst talent among your staff will be key to harnessing the power of your info. With that in mind, here are some key things to get your department ready of the demands of Big Data:
•Train or recruit staff with solid data management skills. Get these folks in your hiring pipeline, and teach them your business.
•Investigate Big Data tools, and integrate them into your operations. Apache Hadoop, an open source program initiative that’s developed software to manage these huge data sets, is a good place to start.
•Find out what kind of data analysis your organisation needs, and use it for all it’s worth.
Dave King is editor for Information Technology Advisor, published by Progressive Business Publications. Learn about career opportunities with PBP at Progressive Business Publications Employment, or visit the company’s GlassDoor page.