In the age of “big data” many organizations are drowning in information but thirsting for knowledge. Organizations today collect enormous amounts of data from numerous sources, but lack the ability to turn that information into insight.
“Big data” is a term used to describe the massive amount of data produced by a new generation of systems and applications. These are datasets so large that they have transcended the ability of typical database software tools to capture, store, manage and analyze. Although the definition is necessarily subjective, most analysts use the term in reference to terabytes, exabytes or even zettabytes of data.
While this clearly puts a strain on data storage infrastructures, big data also creates big opportunities. Forward-thinking companies are looking to next-generation business analytics tools to examine historical data and detect patterns that will improve decisions and provide better outcomes. Companies that can analyze precisely what they know about their customers and business partners, their supply chains and their operations can then make decisions that cut costs, speed time-to-market and increase revenue.
A Game Changer
This is why CIOs say that business analytics will be their top strategic technology investment over the next five years — even ahead of more headline-grabbing technologies such as cloud computing and virtualization.
“The advent of business analytics is clearly a game-changing opportunity for organizations that want to be more efficient in their business processes and still increase the likelihood of achieving needed levels of bottom-line business performance,” said Robert Kugel, senior VP of research at Ventana Research. “Without a strong business analytics foundation, organizations will not be able to understand where to optimize performance, let alone plan to achieve the goals required for guiding an organization's performance. The organizations that invest in business analytics and collaborate across line-of-business areas and IT are most likely to be innovating in their use of analytics and to achieve increased operational efficiencies.”
In a recent IBM survey of 3,018 CIOs spanning 71 countries and 18 industries, 83 percent of midmarket CIOs identified analytics as their top-priority investment area. In particular, CIOs are looking to invest in data warehousing (64 percent), visual dashboards (64 percent), master data management (63 percent) and client analytics (63 percent) that not only help them better utilize structured data, but also unstructured data in the form of videos, blogs and tweets that can be obtained through the social web.
“An increasingly sensor-based, mobile-enabled and instrumented environment — what IDC calls the Intelligent Economy — is driving big data trends, not just in terms of volume but also in type, complexity and rate,” said Dan Vesset, program VP of IDC's business analytics research. “Capturing, analyzing and managing such dynamic data is increasingly viewed as a competitive advantage for organizations to solve a variety of complex problems . . . and influence timely and better decisions.”
More than BI
Next-generation business analytics goes beyond traditional business intelligence and reporting. Where traditional BI tools are largely focused on answering predefined questions with metrics that are oriented to a consistent style of reporting, these new analytics tools offer a more ad-hoc approach. The focus is on enabling end-users to create on-the-fly searches to uncover new patterns and insights. By delivering information online, rather than in static reports, these new tools allow users to drill down for additional details.
A key difference is the ability to extract information from unstructured data that isn’t recorded in neat rows and columns on a spreadsheet, but is scattered across the web or stored in text documents. In addition, integration of collaboration and social media tools can make it easier to share and comment on data.
In its recent report on the global business intelligence and analytics market, Gartner says SAS dominates the analytic applications market, with SAP, Oracle, IBM and Microsoft also listed among the key vendors. However, consolidation in the market is creating other players. EMC, long a dominant figure in the storage market, now is preparing to help clients figure out what to do with all that stored data. EMC last year purchased Greenplum, maker of self-service, cloud-based analytics, and rolled out the first EMC-Greenplum appliance three months later.
Open-Source Powerhouse
A once-small, open-source project called Hadoop has emerged as one of the hottest analytics engines for large datasets. Hadoop enables batch processing of unstructured and structured data at massive scale using commodity hardware. Internet companies such as Facebook, Twitter and eBay use the engine to crunch data. Given Hadoop’s growing popularity, EMC, NetApp and IBM all have recently jumped on the bandwagon by introducing Hadoop-based analytics platforms.
At a time when rapid technology advances such as cloud computing, mobile applications and social media are driving massive data growth, organizations need the ability to extract meaning from that data to meet shifting market conditions. Next-generation business analytics have transformed big data into big business by providing deeper visibility into structured and unstructured data and improving decision-making processes. That’s why IDC forecasts 7.2 percent compound annual growth of business analytics worldwide for the next five years
“Analytics are more critical than ever to making successful business decisions and achieving maximum performance from business operations,” said Vesset. “We’re seeing increasing evidence that organizational performance and competitiveness can benefit from better and more business analytics, which is why the analytics industry is poised to continue its rapid growth in the years to come.”
