Advanced analytics is becoming an enterprise essential. But most companies appear content to stick with the benefits of the "small data." the technology generates rather than make the necessary investments to capitalize on big data.
That's true even though a majority agree that big data is important, according to a new study commissioned by Dell and the International Institute for Analytics.
The study defines advanced analytics as predictive and prescriptive analytics rather than simple reporting.
Some 71 percent of executives contacted for this study indicated their company is actively using or has near-term plans to use some form of analytics in everyday decision-making.
Nearly half, for example, report they use advanced analytics to evaluate their firm’s financial performance. Almost as many —40 percent —use the technology for a range of tasks that involve customer recruitment/retention/loyalty programs and product usage habits.
When it comes to big data, however, it's a different story. Only about 20 percent of the companies responding use advanced analytics in conjunction with the high volume or high velocity data commonly associated with big data.
This is not to say that respondents dismiss the value that big data can offer. On the contrary, one-third of the respondents strongly agree that big data can be leveraged to gain competitive advantage.
Yet only half of the survey respondents have either implemented or are in the process of implementing big data solutions. Just over one-quarter strongly agree that they’ve made significant investments in Big Data infrastructure.
Small Data Is Enough
One conclusion to draw is that majority of firms simply have their hands full with their own internal, "small" data.
Or put another way, the insights generated from the use of advanced analytics seem to be sufficient to meet firms' current needs. Clearly it has become a valued resource: Nearly all respondents believe advanced analytics is of strategic importance to their organization, and 23 percent went as far as to cite advanced analytics as the "essence of our strategic vision." This belief has permeated the C-Suite with 72percent of CIOs and 32percent of CEOs expressing interest in the technology among large enterprises. That percentage rises to 41percent of CEO's at mid-market firms.
Also these companies do not believe they have fully explored what advanced analytics have to offer. Only 5 percent of adopters believe they have achieved the highest level of analytical maturity. Fifty-seven percent rate their maturity as medium or low.
Big Plans for Big Data
But the sense is that big data's time is nearly here and many companies are preparing to pull the trigger on these projects in the coming months and years.
In a separate study released last month, Fortune 1000 senior business and technology executives surveyed by NewVantage Partners reported that their corporate investments in big data are projected to grow from 35 percent to 75 percent by 2017 for investments greater than $10 million, and by a remarkable 6 percent to 28 percent for investments greater than $50 million. In addition, 67 percent of executives report that they have big data initiatives running in production within the corporation, according to the report, Big Data Executive Survey 2014: An Update on the State of Big Data in the Large Corporate World.
"Our 2014 Big Data Executive Survey shows a remarkable surge in Big Data investment in the last three years," said NewVantage Partners CEO Randy Bean. "The majority of executive respondents characterize Big Data as highly important or mission-critical to their organization, reflecting the value that organizations believe they can realize from big data initiatives."
The term big data itself has become common enough to be used loosely, he continued "but the large corporate world takes its payoffs very seriously, as proven by this enormous jump in investment."