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Big Data Delusions

Avanade announced the results of a survey of more than 500 business executives and IT leaders, which revealed that:

“The investments companies are making to manage big data are paying off. Eighty-four percent of respondents believe big data helps them make better business decisions. And 73% of companies have already used data to increase revenue by growing existing revenue streams (57%) or creating entirely new sources of revenue (43%). Evidence shows big data has become pervasive – more employees in businesses have greater access to increased technology options for managing and analyzing data.”

According to the study, however, “the benefits of big data come with meaningful challenges:”

“Eighty-five percent of respondents report obstacles in managing and analyzing data, including being overwhelmed by sheer volume to data security concerns to not having enough dedicated staff to analyze the data. The majority of stakeholders (63%) also feel their company needs to develop new skills to turn data into business insights.”

Oh really? These widespread challenges didn’t seem to hinder the majority who think they’re making better decisions and generating more revenue.

My take: This is complete and utter delusion.

The advent of Big Data is way-too-new for a majority of firms to: 1) have made investments; 2) have deployed solutions; and 3) have measured the impact of those investments, and then claim that they’re making better decisions and creating new revenue streams.


Contrast the findings from this Avanade study to the eConsultancy study I reported on recently. eConsultancy found that only about one in three execs believe that web analytics, analyzing social media comments, or analyzing customer surveys to be very effective in helping them discover problems or issues with the customer experience.

If these approaches aren’t that effective, then what exactly are respondents to the Avanade survey doing differently to make such great decisions and drive up revenue?


The real problem here is the lack of definition for Big Data.

I don’t doubt that “more employees in businesses have greater access to increased technology options for managing and analyzing data.” But how is that Big Data? Maybe what many of those employees are accessing is Little Data, or Medium Data.

Bottom line: Misuse of the term Big Data has become so pervasive that it practically renders the concept meaningless.

I do doubt, however, that that will stop technology vendors and consulting firms from making exaggerated claims, supported by dubious research.

Ron ShevlinRon Shevlin is Director of Research at Cornerstone Advisors. Get a copy of his best-selling book, Smarter Bank: Why Money Management is More Important Than Money Movement. And don't forget to follow him on Twitter at @rshevlin.

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  1. “Misuse of the term Big Data has become so pervasive that it practically renders the concept meaningless.” – Amen to that.

    “Big Data” is now thrown around by the type of people who used to call loading a lot of data into a spreadsheet and making pretty graphs “data mining.” They apply the term to loading a lot of data into a multitude of spreadsheets so they can make even more pretty graphs.

  2. use of data is not restricted to “web analytics, analyzing social media comments, or analyzing customer surveys”. For example, Oil companies, Airline / Car Reservation / Hotel companies, Pharma, and others have essentially been utilizing big data for years as part of their core business. Now of course, the availability of new data has given other businesses an opportunity to tailor product & service offerings more congruent to their customers’ wants & needs.

    However, I think your point stands. Most Banks & Credit Unions (certainly the institutions with assets < $1b) have become all too comfortable with 'gut guesses' rather than fact-based decision making. At the end of the day, 'big data', 'little data' or anything in between is just fine… just use the data…

  3. SM: I didn’t mean to imply that there aren’t other forms of data analysis besides “web analytics, analyzing SM comments, and analyzing customer surveys.” But so much of the Big Data hype revolves around the analysis of these types of data. Other forms of data analysis have been around for years (I was intimately involved with DSS — decision support systems — before it became known as BI). Why would those longstanding forms of analysis all of a sudden become so influential and profitable? The answer: They’re not, and they’re haven’t. Respondents to the Avanade survey of full of shit.

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