A Quick View Of The Industry: Big Data

Big hype. Big money. Big potential. All apply to "big data," a burgeoning technology sector that's garnered big attention despite a still relatively young existence.

Most executives have at least run across the term "big data," under­standable given the much-touted promise big data holds. Still, many executives aren't clear what big data exactly implies. Others that have a grasp on what big data is aren't as certain of how to get started using it. Ultimately, what's arguably most important to know about big data is that you should give it a long, hard look sooner than later. As Benjamin Woo, managing director at Neuralytix (www.neuralytix.com), says, "I have a trademark saying about big data, 'If you're not doing it, your competi­tors are.'"

All apply to "big data," a burgeoning technology sector that's garnered big attention despite a still relatively young existence.

What is big data?

Numerous definitions for big data have been floated about to date, but essentially it entails data sets (struc­tured and unstructured) so mas­sive in scope that processing and analyzing them with traditional ap­proaches (databases and software) is incredibly difficult. "Big data" is used generically to refer to the var­ious technologies available to tack­le those huge data sets, which might contain information related to so­cial media (tweets, posts, photos, etc.), business transactions, and en­ergy consumption.

In a June 2012 released survey of 154 C-suite executives from various interna­tional industries that Harris Interactive (www.harrisinteractive.com) conducted on behalf of SAP, 28% defined big data as "the massive growth in transaction data"; 24% described it as "new technol­ogies that address the volume, variety, and velocity challenges of big data"; 19% stated it "refers to requirements to store and archive data for regulatory compliance"; and 18% defined big data as "the rise in new data sources, such as social media, mobile device, and ma­chine-generated devices."

Woo defines big data as a "set of technologies that creates strategic orga­nization value by leveraging contextualized complete data sets." Ultimately, he says, "big data is about making money from data," which the company can own or has free or paid access to.

"big data is about making money from data,"

How massive are these data sets? For some perspective, consider re­cent research from IDC (www.idc.com) that stated all new data created glob­ally in 2000 totaled roughly 2 mil­lion terabytes compared to double that amount per day generated now. Helping create that new data are smartphones, smart meters, mobile sensors, and other Internet-connected devices. In 2011 alone, IDC stated, the world generated 1.8 zettabytes of data. By 2020, IDC predicts we will generate 50 times that amount.

How big data is used

In a March 2012 release touting IDC's global forecast for big data technology and services, Dan Vesset, IDC program vice president, busi­ness stated, "For technology buyers, opportunities exist to use big data technology to improve operational ef­ficiency and to drive innovation. Use cases are already present across in­dustries and geographic regions." IDC forecasts the global big data market to expand from $3.2 billion in 2010 to $16.9 billion in 2015.

Woo says organizations can use big data technologies "to better un­derstand their customers or create new streams of revenue and profit." Some companies are using big data to improve their supply chains and others to improve customer support, he says. Additionally, "one company is using it to predict potential fail­ures up to three years in advance," he says. A well-documented case study concerning big data involves UPS, which uses big data technolo­gies to "determine the most optimal routing given traffic, weather, etc. for their trucks to go from one place to another," Woo says. "Even more impressive is that in routing their trucks, they try where possible to have their trucks turn right, given that a right turn consumes less fuel, is safer, and quicker." Woo says some retailers use big data technologies to better understand individual cus­tomers, not just a demographic."

Interestingly, the Harris-SAP poll found that small and medium-sized enterprises are "realizing the competi­tive advantages of using and man­aging big data faster than the larger competitors" and are "more readily identifying its benefits." Among com­petitive advantages to gain from using big data that respondents reported are more efficient business operations (59%), boost in sales (54%), lowering IT costs (50%), enhanced agility (48%), and attracting and keeping customers (46%). Seventy percent of respondents indicated they'd expect a return on big data investments within 12 months due largely to such advantages.

"By using analytics, companies large and small are able to leverage technologies like predictive analytics that result in giving these companies a competitive advantage," says Woo. To date, a few industries have taken big data further than others, he says, in­cluding healthcare, financial services, and retail. "It's arguable whether governments have done enough, but they are certainly one of the biggest beneficiaries," Woo says, citing home­land security and fraud detection as examples.

Where to start

A big misconception concerning big data, Woo says, is that a com­pany needs millions of gigabytes of data to get started. "'Big' is a relative term," he says. "What is big to one company is tiny to another." Another misconception is that big data solu­tions are expensive; Woo explains that some big data applications and technologies are free. "Much of these capabilities come at no or minimal costs. A lot of big data capabilities are already available as a service over the Internet," he says.

"What is big to one company is tiny to another."

Woo advises companies to ponder the question: "What if?' "Business owners should also turn to their smartphones. Many smartphone ap­plications are big data at work," he says. For example, Woo cites an app available for the Web and Android and iOS devices that uses Google Map data, an individual's input, and rental listings from various sources and brings together the multiple data sets to let users find potential homes for rent meeting the users' criteria. "This can save potential renters significant amounts of time, effort, and frustra­tion," he says.

Woo says a business manager who asks "How can big data help my busi­ness?" is asking the wrong question. "It's simply a question of: "How can my business use big data?" he says. Upon instructing business personnel to think about potential revenue op­portunities, he says, "leverage big data to either prove or disprove the oppor­tunity." Ultimately, he says, "All companies need to be integrating big data technologies into their processes."

Key points

"Big data" refers to data sets so large in size that using tradi­tional processing and analyzing methods is difficult.

A misconception regarding big data is that companies need millions of gigabytes of data to get started.

Companies are using big data to lower IT costs, increase sales, improve customer services, and make business opera­tions more efficient.

Some big data apps and technologies are available free or for a minimal cost, and a lot of capabilities are available as a service via the Internet.