Businesses must tackle "data mountain"

Analysing data

Companies need to tackle an ever-growing volume of data if they are to improve their performance and profitability. Firms can no longer pay ever higher costs for collecting and securing data alone, but need to being "insight-driven" enterprises, according to experts on business analytics.

And the market for business analysis and data analytic tools is growing rapidly. IDC, an industry research firm, believes that enterprises will spend $120bn by 2015 in an attempt to make better use of their data.

According to IBM, which has now carried out more than 20,000 data analytics consulting engagements, companies are investing in analytics to solve problems ranging from fraud, to health care planning, to mobile "bill shock". At an analyst event in New York, IBM said that it has registered more than 600 patents for analytical algorithms.

The company is now planning to bring together its consulting and software arms to create a range of "signature solutions" in fraud detection, customer management, and performance insights for finance directors. The CFO Performance Insight solution aims to help finance directors deal with data volumes growing 70 per cent per year.

The signature solutions will not be off the shelf packages, IBM says, but will be easier to implement than bespoke, consultancy based "big data" projects. "They will be tailored to the customer's business and to their data. But there are projects companies want to do over and over, to drive higher value from their customer relationships, to reduce the cost of fraud, or to make the business financially more agile," said Colin Shearer, global industry solutions leader, predictive analytics, at IBM.

But, Shearer suggests, enterprises' approaches to analytics are maturing, not least because of their need to deal with ever-larger volumes of data. "The buyers have matured: this is no longer a sale to IT but solving business problems for the chief marketing officer, COO, or CFO," he says.

"It has to drive profits, but customers are also having to deal with a tidal wave of data that [without analytics] doesn't bring any value to the business. Data management is the foundation, but business analytics extracts the value."