When it comes to data, a lot of businesses believe the bigger the better, but this is not always the case. Over the past couple of years, the concept of Big Data has been a hot topic, but many firms do not fully understand what Big Data is and how – and indeed if – it can benefit their business.
Firms across the financial services sector are currently dealing with the data challenges associated with the implementation of Solvency II, for example. As a result, many of these businesses are struggling to manage the vast amount of data included in this new computation, which is already pushing the boundaries of their systems and staff.
The truth is that very few of these businesses actually have access to, let alone the ability to understand true Big Data, which is so large that it cannot be held by normal databases, or calibrated using desktop programs such as Excel. As such, for some of these firms, it may be better to start by looking at the information sitting right under their noses – Little Data.
Little vs large
Before worrying about Big Data, it’s vital that firms get their Little Data working correctly; otherwise there will be issues when it comes to working with sets that are even the slightest bit larger. Understanding how Little Data impacts a business – and knowing how to handle it effectively – will go a long way for companies looking to maximise their business intelligence.
Many businesses face problems when it comes to analysing and getting results from the data they have within their systems, however. In part, this is because so many are still using spreadsheets for this purpose. This approach is likely to create a number of obstacles, as spreadsheets are simply not flexible or complex enough to compute large amounts of complex information.
According to research from Accountagility, over 80% of CFOs and Financial Directors reported a fault when using this tool for data analysis. As such, businesses should focus on fixing the errors within their Little Data to ensure that their basic procedures, such as month end and financial reporting, are creating an impact and providing a benefit to the organisation, before attempting to tackle Big Data head-on.
Managing up
In order for a company to identify how it can best use and manage its data, it needs to consider the key objectives it would like to solve. Agreeing on these objectives beforehand will go a long way to helping a business to map out its goals and better understand what data will allow it to achieve.
Creating objectives will also make it easier for executive board members to make important decisions for the company, as they will have evidence to support their choices. In order to obtain these benefits, however, companies must ensure that their planning tool is agile, as the information being assessed will change on a regular basis.
The problem is that spreadsheets are typically not flexible enough to deal with the constant fluctuations of data, such as currency exchange rates, so organisations must consider other options in order to make the most of the business intelligence hidden within their data. Having a tool that can cope with these constantly changing demands is vital for even the smallest levels of Little Data.
The future of data
When it comes to data, big is not always beautiful. The majority of businesses will never have access to – or the need for – Big Data and if they do, they won’t necessarily have the tools to process it.
Therefore it is far more beneficial for a firm to concentrate on what Little Data can do for the business. This approach will enable companies to forward plan more effectively and achieve a much higher quality level of analysis, rather than simply hopping on the Big Data bandwagon.
Robert Gothan
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