Michael Rappa's analysis of the circumstances surrounding the Facebook IPO reveals just how easy it is for a large and seemingly bulletproof enterprise to fail miserably at Business Intelligence, Business Analytics, and Big Data:
Facebook has mountains of data on a scale few companies have ever seen before. Shouldn't it have unparalleled insights into its users and their value to advertisers? Reading the prospectus, I was surprised to see the IPO rested as heavily as it did on the weight of a single trend line ‑ growth in active users over time ‑ and not on data-driven insights into its user community. If Facebook is making good use of its data, it’s not evident to investors.
It seems to be a classic case of selling the sizzle rather than the steak, and the market figured it out pretty quickly, though not quickly enough to prevent a lot of people losing a lot of money. Has the dot-com bubblereally faded from our collective memory that quickly?
It's already hard to remember what we did before social media, but the question about social media, as with the dot-com ventures, has always been how to monetize its great wealth of community and data.
But the Facebook story is now also a Big Data story, because the information Facebook has about each of us is vast, and comes in many formats. It has volume and variety, two of the three defining qualities for Big Data.
The third defining quality for Big Data is velocity: It's not enough to analyze the available data; the analysis has to be as close to immediate as possible. If Big Data offers competitive advantage, it is in the velocity with which insight can be delivered and monetized.
Risk management, management by strategic objective, and public company governance find common cause in Big Data. Jill Dyché says as much in her Harvard Business Review article, "Data: One Antidote to Risky Behavior":
Savvy managers understand that weaving data-driven decisions into the fabric of corporate governance can obviate organizational infighting and drive progress. By establishing clear accountability measures, managers can determine whether and how corporate goals are being achieved, and hold people accountable for how they are achieving those goals. This motivates business people to rely less on hunches and more on hard data.
When we apply what we know, when we know it, to the realization of strategic objectives, we mitigate risk, and increase shareholder value. The attraction of managing by "gut feelings" has always been its immediacy. Providing the hard data to support or counter gut feelings with the same kind of immediacy is the Business Intelligence/Business Analytics/Big Data challenge.
