While local corporates are ready for big data analytics, there is a general lack of strategic vision and drive to support its implementation.
Large South African corporates are lagging far behind when it comes to the utilisation of big data analytics due to a lack of understanding at an executive level of the competitive advantage big data analytics brings in enabling companies to respond to data it has collected in real time.
Adrian Wood, Sales & Business Director – Sub Saharan Africa at Hitachi Data Systems (HDS), says that when HDS, a wholly owned subsidiary of Hitachi, Ltd, conducted research in the United Kingdom (UK), it found that 75 percent of the organisations with more than 1,000 employees surveyed are currently investing in big data analytics. And of these, 80 percent are deploying solutions.
“Sixty-nine per cent of organisations investing in big data analytics agreed that they do not have the infrastructure in place to analyse up-to-the-minute information across all their data sets,” he says.
Big data analytics gives companies the ability to analyse structured and unstructured data in real time and make business relevant decisions based on that analysis. It would primarily be used by the likes of telecoms operators, retailers and banks.
However, local high level research conducted by Strategy Worx on behalf of Hitachi Data Systems, suggests that while many of South Africa’s large corporations do have the hardware infrastructure in place, the CIOs within those organisations are generally not currently using big data analytics or systems in any substantive way.
To understand the implications of why big data analytics is important, Wood says consider the implications of a telecoms company releasing a new product set into the market, which encounters stiff criticism in the social media sphere.
“Big data analytics would give the telecoms operator the ability to analyse social media responses in relation to the product as well as the real time internal data such as the uptake of the product, the effect on the call centre, and other financial data.
“Given the siloed nature of the operations of many corporates, these are conclusions that are often only drawn several months down the line,” he says.
Steven Ambrose, Strategy Worx CEO, says that the research showed that in many cases while South African CIOs were aware of big data analytics and the trends around it internationally, they did not understand the potential impact big data analytics could have on their businesses.
“Unfortunately CIOs and IT operations are often seen as cost centres within large corporates in South Africa, and as a result, local CIOs aren’t always thinking strategically when it comes to the use of technology like big data analytics.
“Furthermore, the historical lack of competitiveness in sectors like telecoms, banking and retail together with the lack of broadband penetration locally means that businesses have not been exposed to the full impact of their customers’ responses to their products and services to the same degree that UK corporates might be,” he says.
However, the customer movement within sectors like banking and telecoms are showing that consumers are switching service providers, which means that competition is increasing in these sectors and businesses need to be able to analyse trends and make decisions far faster than they have had to do in the past. Real time analysis of data is becoming a major differentiator and business resource.
Wood says it is somewhat surprising that the strategic importance of big data analytics has been missed.
Large corporates locally instead place importance on up-to-date data and basing decisions on this data for accurate measurable outcomes. This contrasts the UK research where just over half the sample viewed making critical decisions based on old data poor practice.
“Instead large corporates locally use business intelligence systems and data specialists to analyse current structured and unstructured data. BI systems are focused on line of business solutions with a small amount of understanding customer behaviour based on historical activity,” he says.
As a result, Ambrose says local corporates are reactive to consumer behaviour and unable to make strategic and timeous decisions to change tack when a course of action is proving detrimental to the business.