Capitalizing on Big Data

Capitalizing on Big Data

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  E-Guide CAPITALIZING ON BIG DATA ▲
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  PAG E 2O F 13 SPONSORED BY Home MIT panelists: Big data calls for data- driven decision- making skills Gartner’s basic business rules for capitalizing on big data CAPITALIZING ON BIG DATA ig data is a HUGE trend. A company’s ability to collect, process and analyze largedatasetscouldwellmeanthediffer- ence between success and failure. Lead- ership—on the IT and business side—is key. In this E-Guide, learn the key steps organizations need to develop and take in order to capitalize on Big Data. B
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  PAG E 3O F 13 SPONSORED BY Home MIT panelists: Big data calls for data- driven decision- making skills Gartner’s basic business rules for capitalizing on big data CAPITALIZING ON BIG DATA MIT PANELISTS: BIG DATA CALLS FOR DATA-DRIVEN DECI- SION-MAKING SKILLS Organizationsneedtodevelopdata-drivendecision-makingskillstocapitalize on new and emerging big data technologies, attendees were told at this week's MIT Sloan CIO Symposium in Cambridge, Mass. Intuitive decisions are not the path to success when working with the mountains of structured and un- structured information companies are collecting in big data environments, conference presenters said. "Big data has changed the C-suite entirely," said Shawn Banerji, manag- ing director at Russell Reynolds Associates, a New York-based technology recruiter. "Reliance on empirical data is in. Going with your gut is out." While computers and computer users continue to create more informa- tion and technologists find new ways to slice and dice it, the skills required to analyzethedataremaininshortsupply.Itwillbechallengingforcompaniesto fill leadership positions with individuals who truly understand data and how to use it effectively, MIT researchers said during a panel discussion on "The Reality of Big Data."
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  PAG E 4O F 13 SPONSORED BY Home MIT panelists: Big data calls for data- driven decision- making skills Gartner’s basic business rules for capitalizing on big data CAPITALIZING ON BIG DATA DATA UNDER THE MICROSCOPE Bigdataisa"measurementrevolution"thatmustbeaccompaniedbyasimilar "management revolution," said Erik Brynjolfsson, a professor at MIT's Sloan School of Management and director of the MIT Center for Digital Business. Brynjolfssonsaidchangesbroughtonbygreaterdataavailabilityresemble changesinbiologybroughtaboutby15th-centurylensmakerAntonvanLeeu- wenhoek's invention of the microscope. Van Leeuwenhoek's early technical lettersdescribingtheminutelifeformshehadseenunderthemicroscopewere met with misunderstanding and derision, because many of the established scientists of the day simply could not embrace the idea that microorganisms existed. Today's chief executive officers and chief information officers may be even less ready to believe what the big data in their systems tells them. "Weneedtochangethedecisionprocessfromonegoingwithhunchesand opinions to one [based on] facts and data," Brynjolfsson said. That means ob- tainingbetterdataanalysisskills,especiallyintheareaofstatisticalprobability. WHEN CORRELATION MET CAUSALITY Brynjolfssonwarnedthatunwarrantedinferencescanbeanegativesideeffect ofbigdata,andsaidthatwhenunexpecteddataisencountered,it'sagoodidea
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  PAG E 5OF 13 SPONSORED BY Home MIT panelists: Big data calls for data- driven decision- making skills Gartner’s basic business rules for capitalizing on big data CAPITALIZING ON BIG DATA to ask more questions, not less. New kinds of data, much of it semi-structured andunstructured,areoftendifficulttoassessandcanbefuzzy.Therearewhole setsof"weirddata"thatemerge,Brynjolfssonsaid.Theresultcanbethatinfer- ences made based on the data are untrue. "Correlation is not causality. This is the most significant mistake people make with data," he said, echoing a common adage teachers use to remind science students that elements that appear together may not actually have a cause-and-effect relationship. Assuming such a relationship can lead to false inferences. The same adage was a prominent theme in The Signal and the Noise, the recent bestseller by big data wunderkind and The New York Times blogger Nate Silver. As one might expect at a university symposium, education was seen as a possible path to better data-driven decision making when working with big datasets.Bettereducationinstatisticalinferenceisimportant,panelmembers said, even at the high school level. FRONT-LINE BIG DATA DECISIONS While CEOs and CIOs need to prepare for big data decision-making, they should also be ready to delegate decisions to other managers. Often, people
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  PAG E 6OF 13 SPONSORED BY Home MIT panelists: Big data calls for data- driven decision- making skills Gartner’s basic business rules for capitalizing on big data CAPITALIZING ON BIG DATA on the front lines can make the better decisions, said Frank Diana, a principal consultant at Tata Consultancy Services Ltd.'s U.S. operations. "It's hard to get people used to not making decisions on a gut level. The key is that decision making has to be pushed closer and closer to the edge, where business is being conducted," said Diana, who took part in another big data panel session. Diana said the term big data may come and go, but the need for new sets of data analysis skills will only continue to grow. "One of the fundamental ele- ments driving success in the future is analytics excellence," he said. However,aviewcontrarytothe''gowiththedata"approachcamebywayof a conference attendee who suggested that the big data panel members should considerthebeneficialroleofintuition.HecitedthecaseofthelateAppleCEO SteveJobs,whowouldfamouslyshunresearchdata,saying,"Peopledon'tknow what they want until you show it to them."
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  PAG E 7O F 13 SPONSORED BY Home MIT panelists: Big data calls for data- driven decision- making skills Gartner’s basic business rules for capitalizing on big data CAPITALIZING ON BIG DATA GARTNER’S BASIC BUSINESS RULES FOR CAPITALIZING ON BIG DATA Big data is like a fashion trend: You can't turn around without seeing yet an- other magazine article, research report or talking head pontificating on why you can't live without it. In this case, however, the trend-pushers have a point. Case studies at the Gartner Business Intelligence Summit added to a growing body of evidence that a company's ability to collect, process and analyze large data sets could well mean the difference between success and failure. Leader- ship -- on the IT and business side -- is key. In part one of this two-part SearchCIO tip on developing a big data analyt- ics strategy, Gartner analyst Doug Laney laid out the steps CIOs must take to makeITdepartmentsbig-data-enabled.Here,LaneyandcolleagueMarkBeyer explainwhybigdatarepresentsararetechnologybreakthroughandofferthree basic business rules for leaders to ensure that their companies don't get left behind.
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  PAG E 8OF 13 SPONSORED BY Home MIT panelists: Big data calls for data- driven decision- making skills Gartner’s basic business rules for capitalizing on big data CAPITALIZING ON BIG DATA BASIC BUSINESS RULES FOR CAPITALIZING ON BIG DATA Define the value of big data for your company. In 2008 and 2009, simultaneous improvements to storage, memory, processing and network technologies triggered big data's rise in popularity. These improvements are often characterized as the three V's of big data -- volume, variety and velocity. "Everythinggotbiggerandfasterallatonce,"GartneranalystMarkBeyersaid, referring to this as an "alignment of the four planets of technology." It's a moment in technological history that happens once every 15 years or so, according to Beyer; when it does, companies stumble to figure out how to take advantage of the rare occasion, often seeing it as an opportunity for more data analysis. This is where businesses are now with big data and why the fourth V -- value-- has begun to emerge. "We'vecomearoundtotheideathatbigdataisn'tallaboutthesethreeV's," Laney said. "It's also about recognizing that there are opportunities to really innovate with this information." Big data analytics can not only help businesses create new efficiencies, make better decisions and edge into real-time processing, it can also inspire business transformation. Some of the most successful manipulators of big datahavefiguredouthowtoturnthedatathey'vecollectedallalongintoanew
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  PAG E 9OF 13 SPONSORED BY Home MIT panelists: Big data calls for data- driven decision- making skills Gartner’s basic business rules for capitalizing on big data CAPITALIZING ON BIG DATA source of revenue. "DollarGeneralisagreatexampleofanorganizationthathasimplemented a self-funding data warehouse," Laney said. The retailer grants access to ano- nymized transactional data (see sidebar) for a fee via 1010data's Software as a Service data warehouse product, he said. Takeaninventoryofcompanydatasources(yes,itisbusiness'job). Laney said he's "concerned, flabbergasted, dismayed" that businesses have a better accounting of physical assets such as tables and chairs than they do of their data. His research on what he calls infonomics -- the economics of infor- mation -- encourages businesses to think otherwise. To get started on this business rule, Laney suggests taking an inventory of datasources--internalandexternal--availabletothebusiness.Thelistcould include operational data, such as point-of-sale or machine-generated; com- mercially syndicated data; dark data, which refers to data collected, used once and then archived, such as email; and public data, such as weather reports or census information. TheClimateCorp.,astartupfromtwoformerGoogleemployees,usespub- lic data and big data analytics to build its flagship product -- crop insurance policiesforU.S.farmersbasedonweatherpredictions.Unlikeotherinsurance
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  PAG E 10O F 13 SPONSORED BY Home MIT panelists: Big data calls for data- driven decision- making skills Gartner’s basic business rules for capitalizing on big data CAPITALIZING ON BIG DATA companies, The Climate Corp.'s policies are individualized and dependent on avarietyoffactorssuchascroptype,fieldlocation,soiltypeandrelativematu- rity of seed planted, according to the company website. Some data points used come from open data sources, such as weather and forecast reports, as well as soil samples, Laney said. Adopt and adapt good big data ideas from other industries. "One of thequestionsIgetasananalystis,'Whatareothersinourindustrydoingwith bigdataoranalytics?'That'snotanoutrightterriblequestion…butwhydoyou want to be second?" Laney said. For example, everyone's stuck on the story of Target outing a pregnant teenagerwithitsuseofdataandanalytics;it'safunstorytotell,Laneysaid,but can the story be mined for innovative ideas that can be applied to businesses besides Target? Probably not, he said. Rather than seeking out trials and suc- cessesfromsimilarbusinesses,lookatthesuccessesfrombusinessesinother fields and how those successes might be adapted. "This is where innovation comes into play," he said. TaketheshowHouseofCards,launchedintheU.K.(seesidebar).Tocreate the U.S. version of the show, its parent entertainment company used viewer data -- and lots of it -- to determine the storyline, the director to hire and the
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  PAG E 11OF 13 SPONSORED BY Home MIT panelists: Big data calls for data- driven decision- making skills Gartner’s basic business rules for capitalizing on big data CAPITALIZING ON BIG DATA leading actor to cast. "Youmaynotbeintheentertainmentindustry,"Laneysaid,"butwhatkind ofdatacanyoucollectaboutthebehaviorofyourcustomersorusersovertime thatcouldhelpyoucraftnewofferingsthatspecificallyandexpertlytargettheir interests?"
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