Forget “big data”, we need smart data

Word Cloud "Big Data"While the Technology industry is a very exciting space to work in and has always afforded me incredible opportunities in my working life, it often frustrates me also.  I feel the recent hype around big data is a worrying example of this – we can over-simplify things and therefore understate the value we bring to the marketplace.  But beyond that, too often we give the market the impression that our solutions are a silver bullet when in fact that there is far more to a problem than just throwing some technology at it. I made these points in The Rust Report this week – please do let me know what you think…

“It seems the IT industry has done it again.  Too often in the past the Technology Sector has created a huge bandwagon onto which every marketeer in the industry has jumped without anyone scrutinising the actual value being proposed, or making the case with any depth.  Pretty soon customers see through the empty and shallow proposition and the bubble bursts, leading to a backlash, job losses and diminished credibility.  I’m very concerned history is repeating itself.

Think Y2K, or RFID, or even Cloud.  While all of these propositions were more than valid, the huge bubble in vacuous marketing hype left the customer feeling short changed.  With Big Data I feel the case has not been made correctly.

Anyone who was at last year’s CeBit Keynote in Sydney would remember Obama CTO Harper Reed’s confronting comment – and I paraphrase – “Big Data is bovine excrement”.  His point was that the “Big Data” challenge was a storage one – back in 2007.  Today that challenge is solved.  The real challenge of data today is how to derive real value from it, not where to put it.  Today the industry is busy selling solutions to the wrong problem.

“When I hear Big Data, I immediately hear marketing” said Harper.  “All these great brands, they’ve really jumped into this marketing world of talking about the problems that are pretty much solved.”

We don’t need Big Data, we need Smart Data. There’s data tracking everything possible from our physical movements, to our buying and trading habits, to our relationships and thoughts.  But while GPS, Social and mobile surfing behaviour data are all religiously monitored, everyday products and even whole businesses are failing.  We’re busy collecting all this data, but we aren’t learning anything from it.  This is what the industry needs to solve.  As many others have pointed out, with all the trading data and predictive models available, we still didn’t see the GFC coming.

When was the last time you heard anyone talk about Radio Frequency IDentification (RFID)?  It was all anyone could talk about in 2006, but after everyone put tags on anything that moved, they derived no value from it because no one figured out where to put all the data they created, let alone how to learn anything from it.  As a result, ROI was minimal.  I’m having deja vu with Big Data.

The first problem is talent.  The news is currently peppered with surveys that identify a spectacular gap between the Big Data skills required and the talent available to meet those needs.  What are Australian Universities and Governments doing to solve these problems?  It remains the case that, used and educated effectively, the best computer we have access to is still the human brain.  But we don’t have enough people who know how to ask the right questions – query the data – let alone how to extract the answers.  This requires a unique blend of mathematics, psychology and business acumen.  I am not sure Australian universities are investing enough in cultivating these skills and businesses don’t know where to find them.

Equally, where are the smart algorithm apps that help smaller companies extract value from the data they have stored in databases like Oracle or Salesforce. A good example is SalesPredict in the US, which recently raised $1 million in seed funding to help small companies predict which sales leads are more likely to convert.  Advanced Pattern Discovery is a another tremendous application of Big Data but it requires very clever modelling software to produce.   This is a huge area of potential innovation Australian entrepreneurs could be investing in – with Government help – but I’m not hearing about them.  I would certainly like to see our local industry investing more in this area, far more than in marketing hype around big storage boxes.

Software doesn’t solve the big data issue and as the old saying goes, “a fool with a tool is still a fool”! It is crucial to consider the strategy that drives where to look for answers, which data sets to use and how to get the correct insights. This process is performed by humans, the technology just facilitates it. The gap we have is the human gap.  What is the industry in Australia doing to fill that gap?

As the nation furiously debates the future of education and skills development in both the TAFE and University spaces, this is an important new skill set that business desperately needs more talent in.  I would like to hear more discussion about how Government and Industry can invest in this development – much more than I want to hear about the latest “Big Data” solution.”

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Do you have the X-factor?

smhThis week the Sydney Morning Herald published an article I wrote about values. Anyone that has worked with me knows that I am a strong believer in values and their role in business success.  I wanted to summarise these beliefs for the wider business community in the hope that it might provide some balance to the picture, because I feel that far too often there is too much talk about measurement and data and KPIs when there are some other less tangible factors that are harder to measure but nevertheless important to doing well.  Here is the article:

“We’re told running a successful business is all about growth, profit, measurement and accountability. ROI, KPIs and Big Data mean that everything we do is measured to the enth degree and constant reviews of the business and our performance within it are critical to staying on track.

For the most part this has made us focused and disciplined, which is a good thing. But along the way there are some elements that we’ve forgotten: I call it the X-Factor. As Albert Einstein said, “Not everything that counts can be counted; and not everything that can be counted, counts”. As a result of this obsessive focus on numbers, we tend to measure everything, even if it isn’t really an indicator of anything worthwhile. But at the same time, there are some aspects of business we don’t and can’t measure, but which deliver a huge degree of intrinsic value.

We have learned intangible and mercurial aspects of business, we call the X-factor, can deliver huge benefits. I am advocating an approach that encourages people’s passion and it’s really working for us. There are three aspects to creating a winning X-Factor culture:

The first is around values. When we articulated what our culture had become we didn’t realise it would be so important. We have found it to be very powerful as it has become ever-present in everything we do. It started when we expanded across the country and wanted to make sure who we were wasn’t being diluted or distorted across our national and regional offices. We spent time thinking about what lexicon best reflected the organisation we thought we were, what we wanted to be and how we wanted to be perceived.

The second aspect is your environment. When we moved into new offices – a refurbished warehouse space in Sydney’s CBD – architectural design firm Rolf Ockert created a space that reflected our values. We tried not to provide too tight a brief, except to say the overall effect should be “funky” and consistent with our values. The result has been an environment people feel inspired by, which has won awards and is an instant talking point.

Finally, there is attitude. We identified in the creation of our X-Factor that our team was overwhelmingly committed to caring about the customer. Not in a way that could be measured by customer satisfaction surveys; and not even in a way that could be tracked in customer retention dashboards or other metrics.

You can retain your customers by simply staying ahead of your competition – in price or in customer service. But we discovered our people wanted to commit to something above and beyond that. We defined this in terms of seeking to always delight our customers. Our customers appreciate it, and it is borne out in our revenue figures and overall success.

But more important than all of this the pride my colleagues have in the workplace, its professionalism and passion.

I was surprised how much the X-Factor has impacted our business. Nowhere in my MBA studies was this kind of “fluffy stuff” recognised as powerful and differentiating. We weren’t taught how to create it or cultivate it as leaders and managers but I now know that our company wouldn’t be what it is without it. It seems today we lean so heavily on the left side of our brain, we forget how much the right side can contribute.”