On the plane this week I read an ad in the Wall Street Journal by IBM all about "Big Data". What they said in the ad, and have dedicated a whole web presence to (IBM Big Data) is that, while available data about a business and its operations is exploding, it's "the analysis and use of the right data" that's important.
I couldn't agree more. In fact my business, InHouseCFO Inc., is committing significant resources to making Big Data work for small and mid-sized businesses.
Digital data, combined with Cloud technology, using properly configured software that collects and reports data is extremely valuable to an experience eye. I would submit, so valuable that it is necessary to any size business' very survival in today's emerging highly knowledgeable competitive world.
Big Data is Not Just for Big Business
There is however a common misconception that the statement made by IBM in their ad applies only to bigger brands, otherwise, IBM, known to service the largest companies, wouldn't be committing expensive ad space to this market dynamic.
The above comments apply to all businesses, any size, any industry, any target market. In fact it's more precious and necessary to small businesses.
Big Data Increases Competition to Small Business
Customers, now more than ever, armed with an incredible amount of market intelligence, expect continuous believable acknowledgement from businesses that they play a significant role in a business' daily life. Big Business knows this and is responding by using Big Data to gain business inteligence of its own, and use it to connect with the customer.
The benefit of this connection to Big Business is that they become much more nimble and very personal with customers, putting at risk the competitive edge enjoyed up to now by small and midsized businesses. I'm the first one to say that Big Data and the tools available to use them will allow the bigger brands to up the competetion ante in all markets previously owned by small and mid-sized businesses.
Small Business Can Get Into Big Data Too
I'm thankful that the companies in the Software as a Service (SaaS) business segment have and continue to build affordable yet powerful solutions that any size business can and needs to put to use to combat these new competitive forces, but more than that, to capture more market share, and with a happier customer, a higher revenue per customer metric.
The key for a small or mid-sized business is to adopt as a first priority "Getting in the Cloud".
This is not a trivial task, and requires some changed systems, ways of doing things, along with cultural paradigms. Here are the steps to follow:
- Write down how you do business:
- Start with how you build awareness, and end at when you review how you've done at the end of your normal business cycle (usually a year-end review);
- This will give you a better understanding of the processes your business follows;
- Can be as simple as handwritten sheets, to something like the one we did for a medical cosmetic services business' Marketing and Sales Processes;
- The key is to get it down on paper.
- These are known as key performance indicators (KPI's);
- Run your business; and
- Connect with your customer like the big boys;
- Don't worry, we've identified certain solutions that work very well with small to mid-sized businesses. See InHouseCFO's Results-Based System in the Cloud for Canadian SMB's.
- This will be your new cloud-based business information system (BIS).
- To the extent it exists, this helps set KPI's and interpret results;
- The best solutions allow for all of this to happen, so don't skimp;
We've found that it is well worth it to invest the time and money to get it right, and to do so, qualified, experienced professionals should be engaged to assist in all of this. The right ones also work with your business to ensure everyone is properly and fully trained and are able to work with you on an ongoing basis to interpret the results accurately, comprehensively, and quickly.
Once this is all accomplished, not only will a business fend off the increased threats from big business that are inevitable, it will enjoy enhanced results both financial and cultural from having harnessed the value of Big Data at the same time.
(Don is a Chartered Accountant and is the Managing Director of InHouseCFO Inc., a consulting firm dedicated to ensuring that growing small business' and their founders succeed by helping them increase their results through enhanced business disciplines, intelligence and financial stewardship. He can be reached at firstname.lastname@example.org)