by Svetlana Sicular | May 27, 2013 | Comments Off on The Top Mistake in Evaluating Big Data Initiatives
People starting a big data initiative feel like adventurers entering Terra Incognita. The mere fact of breaking into the big data space is often enough for them to lose ground because everything seems new and mysterious. To a certain extent, it is true. But just to an extent. The spirit of big data adventure distracts people from the fact that not all big data ideas are equal. The biggest mistake is failure to distinguish game-changing from business extension big data opportunities and treat them appropriately. If you are on the big data journey, approach game-changing ideas according to their potential for breakthroughs and evaluate business extension initiatives based on their predictable cost and benefits. I wrote about that in A Framework for Evaluating Big Data Initiatives.
Game-changing initiatives implement radical and important new ideas that require more effort but give a greater return. Usually, these are new revenue opportunities, new markets or products, new business, or new ways of customer engagement — an example is a disruptive product that appeals to a new market segment with different needs than those of the enterprise’s current customers. Game changers have a breakthrough potential, but they will also meet a greater resistance of change-averse forces in the enterprise. The game changers might even require new personnel, new departments or new leadership.
Business extension initiatives implement cost-effective solutions that produce extensions or enhancements to existing business processes or products. Usually they are about efficiency, cost and expansion of current market or product capability. Oftentimes, they accelerate a pace of the same processes, when existing technology cannot meet new business conditions. The business extenders are relatively easy for an enterprise as a whole to accept and implement. They require rigor for determining if big data technologies are appropriate or if the existing technologies work better. In some cases, businesspeople just use new technology as a pretext to resolve their problem backlog.
Many business ideas seem game-changing to big data teams just because big data technology is disruptive. Game-changing initiatives are about the future of an enterprise, while the business extenders are about the present. Evaluate your big data initiative differently, depending on whether it is driven by a game-changing or a business-extension idea:
- Use different criteria for use-case selection and evaluation
- Tolerate immaturity of big data technologies to a different degree
- Define POCs differently to assess real costs and benefits
- Build the business cases differently, based on the predictability of benefits.
Around 80% of current big data opportunities are business extenders, therefore, very few ideas are game changers. There is nothing wrong with that — business extension use cases are rather good for the first steps in Terra Incognita: they prove the value of big data for the business. Intimidated by Gartner editors who require references to everything less than known, I checked Wikipedia for Terra Incognita, and found that cartographers labeled such regions with “Here be dragons.” Finding dragons, as well as many other opportunities that involve maps and geolocation, would be true game changers. And this is just the beginning of a big data (ad)venture.
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