Information is a valuable asset for businesses as it helps them make well-informed decisions. Fantastic! Data is being generated at an unprecedented rate and organisations are hording it like there's no tomorrow, creating mammoth data sets we call big data. But is big data really helping these companies or is it just complicating the decision-making process? We find out.
Information overload image from Shutterstock
Big data has a number of applications and, combined with analytics, is used to find answers to problems in a variety of industries. For organisations, it can help them understand customer behaviour and optimise business processes, all of which, in theory, should help executives make sound decisions to drive company growth.
But like so many things that sound good in theory, it's not exactly working out for a number of organisations. In a global survey of over 300 C-level enterprise executives by Chartered Global Management Accountant (CGMA), which was supplemented by in-depth interviews with a small group of business leaders for deeper insight, big data was singled out as a barrier to effective decision-making.
One third of respondents said big data has caused information overload and has made the decision-making process worse. Nearly 36 per cent said they were struggling to cope with the influx of data and, alarmingly, 80 per cent admitted to using flawed information to make strategic decisions at least once in the last three years.
As the CGMA survey report notes:
"Decision makers at those organisations that fail to prioritise and process the data they receive — extracting what is relevant and making it meaningful by adding context and practical insight — will not hear clear signals from their data. They will only hear noise."
But conversely, the results could also mean that a majority of companies are doing something useful with their big data. Pairing the information with sophisticated analytics tools can help organisations turn raw and unstructured data into strategic insight to get ahead of the competition.
The CGMA provided some pointers for businesses being left behind by their inability to capitalise on the large amounts of information they have at their disposal:
- Prioritise data: Data on things like competitor information or environment impact can be invaluable but only if interpretation leads to genuine actionable insight.
- Speed up information sharing within your organisation: Implement technology that will give the right people quick access to the information they need to enhance their jobs.
- Put relevant information in the hands of key decision-makers across the business: Data scientists can help organisations extract information from many sources but only those leaders with a deep understanding of their businesses will understand what insight is required and how to use it.
Is your organisation struggling to cope with big data? Let us know in the comments.