Canadian business unprepared for big data: report

The Canadian IT industry has always had a Chicken Little problem: whenever our companies aren't adopting a new technology fast enough, people act like the sky is falling.

Take "big data," which is not a particular set of technologies but a concept to describe how quickly information is growing inside organizations, how much is being generated and the variety of forms it takes.

Unlike many of the vendors and experts, I refuse to capitalize the first letters of big data, and based on the supposedly ominous results study published earlier this week, many executives have had a similarly lukewarm reaction to the promise and perils it could bring.

In "Big Data in Canada: Challenging Complacency for Competitive Advantage," market research firm IDC provides a valuable in-depth look at how Canadian firms are grappling with big data, which may be best defined as anything which can't be handled by existing databases, applications and storage systems today. It's not an impressive story: only 48 per cent said they are doing anything to get big data issues under control, and 15 per cent have no plans to do so in the future.

"It was a surprise to me," said Carl Farrell, executive vice-president for the Americas at SAS, a software firm that sponsored the study and whose products are designed to help analyze data and recommend ways to grow or improve its customers' businesses. "We definitely seem to be lagging. [Outside of Canada] I'm seeing this problem discussed in C-level offices everywhere."

Nigel Wallis, the IDC Canada analyst who oversaw the research, helps put the situation in perspective. He said many Canadian firms might not be seeing the same deluge of data as their American or multinational counterparts. Companies here are also not as adept or experienced in mashing together software systems that handle customer information and information over mobile devices, which is one example of how you can use big data to predict what customers will buy next, or what else they might want from you.

"If we compare ourselves to the rest of the world, we don't have those giant technology titans like Google, Amazon, or Yahoo," he said, which are gathering an office tower's worth of information on users every day.

The implication from such studies is that if Canadian firms don't jump on the bandwagon as fast as the U.S. does, they will be left behind and lose customers, shareholder value and, finally, their reason to exist. I have seen this pattern repeat itself from the dawn of the dot-com movement to open source software, cloud computing and myriad other tech trends. Yet somehow Canadian companies stay in business.

No doubt there could be great value in Canadian firms sifting through big piles of data to improve their competitive advantage versus global rivals. Farrell and Wallis both talked to me about ways big data could be used to improve customer service, generate new revenue streams and even curtail fraud. At the moment, though, I suspect most Canadian firms are focusing on the day-to-day issues of selling, managing costs and developing their plan for 2013. They'll begin catching up, but at their own pace.

The one thing to think about as they digest the big data marketing messages that will be thrown at them next year is about putting the right people in charge of data analysis. IDC's research suggests companies here tend to delegate big data issues to middle managers, which may explain the lack of significant action. That's probably worth a rethink, because it's C-level executives who most need the insights, and who have the power to do something with them. There's no point in getting serious about big data if you're going to take a small-time approach to it.