David Selinger| Forbes
Big Data is the business challenge of the 21st century, and 2012 was the year that the Big Data revolution rocked the C-suite. After Nate Silver’s massive coup predicting the outcome of every state in the November election, even laypeople no longer doubt that data-driven decisions and real-time information – implemented at lightning speed – can lead to huge wins. To stay ahead of the herd, business innovators have to conquer the sheer volume and velocity of business and customer insights available to them – and analyze and leverage this data to better serve their markets.
So what should the C-suite’s resolution be for 2013? The answer: Use the Big Data opportunity to remain relevant, and, frankly, to stay in business. If executives don’t find a way to trap, tame and train their data monsters, they’ll be extinct in 2 years – fossils who’ve missed the new world order.
These may sound like strong words, but let’s face the facts. According to IBM, 90% of the data in the world today was created in the last 2 years alone. This data springs from such diverse sources as weather, social media posts, digital pictures and videos, purchase transaction records and cell phone GPS signals, to name a few. Not surprisingly, businesses continue to grapple with how to ingest, understand, and operationalize Big Data. A recent study of 75 North American retail executives found that 46% of retailers considered the volume of information with which they must contend to be the biggest challenge in dealing with Big Data. 34% say managing data variety – both structured and unstructured – is the top challenge; 20% say handling data velocity, or the frequency at which data are generated and captured, is hardest.
I managed data mining and site optimization at Amazon.com almost a decade ago – a century in tech years. Amazon proved you could make billions a penny at a time by operationalizing enterprise data – that is, by making customer data available in real time for decision-making, for your associates, and in the hands of your consumer.
You don’t have to be a data scientist or run a tech company to know obsolescence when you see it. While some enterprises lumber on – relying on former glory – the next generation is leveraging data assets with agility and prescience. This year’s T. rex will be next year’s museum exhibit – faster than you can say MySpace – unless you do the following:
- Find Experts
Enable your company to share insights fast and easily by building a crack team who’s passionate about the possibilities. The battleground of success in Silicon Valley – and in any industry – is fought and won on talent, and attitudes trickle down to the trenches. Or you can let someone else handle the headache, especially since in-house engineers can now command $300,000 salaries. Since pace of execution is key – as is responding to customers in real time – outsource to people who live, breathe and dream data. This way, you can execute programs and initiatives before your customers abandon you (and competitors eat your lunch). Either way, enlist visionaries who see the path forward.
- Take Advantage of the Cloud
Most companies don’t want to know every detail and make every decision about data. Yes, their hardware stack should be seamless to take advantage of order-of-magnitude decreases in the cost of storage and computing, but it’s a nightmare to perpetually transition IT resources – mainframe to Oracle to open-source to Hadoop, for instance. Outsourcing and the cloud save non-tech companies from having to chase and curb ever-increasing complexity. Companies just want to know, at the points of interface: “Can you take in all my data? Can you process and execute the analytical model we want?” Then they can concentrate on their core competency – and on staying relevant to their constituency.
- Remember Privacy
Privacy is an increasingly urgent issue for both the public and private sectors. How we cultivate, store and maintain our customers’ data today is vital for the expectations and demands of tomorrow. Sandy Pentland at MIT talks about the New Deal on Data, a consumer’s Bill of Rights, and how leveraging personal data respectfully, and designing products and services that offer really personal recommendations, can enable “human physics” to be understood at a fine-grained level, which offers amazing cultural possibilities beyond commerce and industry. Big Data offers the opportunity to build connections with people and identify connections among people, behaviors, and outcomes. But in so doing, never forget to be transparent with customers on what information is collected – and offer options for how any such data are used. Giving customers a sense of control and ownership in exchange for what they’ve shared will go a long way toward building trust.
- Execute, Test, Measure
You really can know which half of your advertising (or whatever) works. Testing allows you to base business decisions on data – not guesses, and not internal politics. Let the best idea in your organization – not the most senior person – drive strategy. And let feedback from customers confirm hunches immediately, so you can re-tool in hours, not weeks or months. Your customers will tell you what they want and need. Listen to them. During the busy holiday season, for instance, customers demand zero disruption. So we devote extra resources to ensure that the 1 billion data transactions we process every day – not just during holiday season – are completely glitch-free. That’s 10,000 data points each second – and 11,500 during Black Friday, our annual blitzkreig. We run that same scale of data – Twitter-scale – through predictive algorithms in real time. The only way we can transmit raw data into business wisdom at the speed of a tweet is to ensure we’re “fully redundant and self-healing,” as my VP of IT Ops says. Fail fast and keep moving.
Change is the only constant. Advances in mobile, social, e-commerce, personalization and cyber-security are only accelerating. Data are our only response to adapt at this daunting pace of change. Staying relevant requires that we constantly listen to, learn from and optimize using the data at our fingertips. 2013 is before us, asking us the ultimate question: Will we join the data dinosaurs of yesteryear or will we resolve adopt the data-driven culture of the future?