The Challenges and Strengths of Big Data and BI Software Implementation

Big data, according to SAS, is the exponential growth in the volume, variety, and availability of both structured and unstructured data.

On the other hand, CIO.com defines business intelligence (BI) as the umbrella term referring to the various software systems used to make sense of raw data.

Raw data can come from multiple sources that include a company’s sales history, transaction data, inventory, customer data, as well as data from third-party systems.

BI also covers several related activities such as data mining, analytics, querying, and reporting – activities with the goal of transforming raw data into meaningful and actionable information that can be used for business purposes.

Used properly, an enterprise stands to gain much from the insights produced by such activities.

These gains include:

• Enhancing customer service
• Refining hiring and retention practices
• Improving expense control
• Boosting sales
• Updating marketing and branding strategies

In a nutshell, BI lets you know and better manage what’s happening now. At the same time, it provides awareness into what may happen in the future.

Big data + business intelligence

In a recent Forbes.com roundup of analytics, big data, and BI forecasts by contributor Louis Columbus:

• Wikibon foresees the big data market to eclipse $84 billion in 2026, representing a 17% compound annual growth rate (CAGR) for a 15-year period beginning in 2011.
• Salesforce forecasts that adding analytics and BI applications will increase their total addressable market from $13 billion in fiscal year 2014 to $82 billion in calendar year 2018.
• Accenture reports that 89% of the 1,000+ users it surveyed believe that big data will revolutionize business operations the same way the Internet did. 79% agree that companies not willing to embrace big data will lose their competitive edge and may even face extinction, while 83% have already begun pursuing big data projects.
• Allied Market Research projects that the global text analytics market may reach $6.5 billion by 2020, a six-year CAGR of 25.2% from 2014.

SAS also enumerates three benefits that can be gained through big data utilization, namely to:

• Detect, prevent, and remediate financial fraud
• Calculate risk on large portfolios
• Execute high-value marketing campaigns

Challenges to BI and big data usage

As with any endeavor that’s worth pursuing, there are a set of challenges that hinder SMBs from realizing big data and BI’s full potential:

Cost of software implementation

One of the fundamental questions on which the big data and BI strategies of a business sit is:

How much will SMBs have to spend?

According to SmartDataCollective.com, a traditional BI project takes 12 to 24 months to implement. The total cost, which covers consultancy, hardware, implementation, support, and others, is roughly equivalent to 300% to 700% of the license cost of the BI software.

In other words, it takes between one to two years to realize whether or not the money allotted on your BI project is worth it.

ROI that’s not directly quantifiable

An article on the Business Intelligence Best Practices site asserts that despite whatever software vendors say, data warehousing and BI cannot provide a direct, quantifiable financial return compared to an investment on an interest-paying bond or CD.

The software investment can positively impact your decision-making functions and productivity, but declaring the actual value of the benefits of real-time intelligence is a complicated process in itself.

Information overload

An infographic by Narmis enumerates the top challenges preventing small businesses from capitalizing on big data. These include:

• Handling big data volume, variety, and velocity
• Presenting big data analytics in easily digestible visualization formats
• Identifying the best uses of the insights generated from big data
• Determining which parts of the company to focus big data investments

Ways to maximize your BI and big data investments

If there are challenges to BI and big data implementation, there are also ways to put your investments to full use:

Focus

Instead of casting a wide net, a mistake often made by beginners, start small. Then, apply BI and big data techniques on a gradually widening scale to make repercussions and bottlenecks more manageable.

For example, focus your BI investment in the marketing department. Depending on the results, extend your scope from there.

Most businesses start by focusing on sales and finance because the data available in these areas is usually more organized and quantifiable. For service-oriented businesses, time and billing is a good target for BI ROI, says Sikich LLP partner John Kleb in an Inc.com article.

Affordability

In the same article, SAS’s principal manager Tapan Patel notes that SMBs prefer solutions that offer self-service capabilities and require minimal IT involvement.

If you can access and analyze your own data with minimal intervention, you can eliminate the added costs of hiring dedicated IT staff.

Another alternative is to opt for a cloud solution to reduce hardware costs. Also, you can choose a pay-as-you-go pricing scheme that allows you to upgrade or downgrade your subscription according to the benefits you reap.

Cloud access

Cloud-based big data and BI solutions eliminate hardware availability issues, as these become the provider’s responsibility. Businesses should then evaluate potential vendor partners based on a set of criteria that includes the following:

• Usability
• Data security
• Scalability
• Support

ROI measurement

The ROI from big data and BI is manifested through improved decision-making, better processes, and amplified productivity. Gartner’s advice is to measure user satisfaction based on “a set of predefined BI objectives, 18 to 24 months after deployment.”

According to Gartner’s Bill Hostmann, companies can use a simple survey and then determine whether or not they have answered the question, “Do you have the information that you need to manage your business?”

If, after all this, your financial returns are the same even with BI and big data systems in place, at least one of the following is ill-suited.

• Strategy
• Tools
• Preferred vendor

Conclusion

While big data and business intelligence aren’t interchangeable, they’re not mutually exclusive, either. As TDWI.org puts it, “Integrating advanced analytics for big data with BI systems is an important step toward gaining full return on investment.”

Capitalizing on the advantages of both tools can significantly improve your company’s forward momentum in terms of growth.

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