Is the big data boom over? Firms planning less investment

06/10/2016

A lack of return on big data projects is causing companies to turn spending towards other priorities, according to new research.

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The study, from Gartner, indicates that tech executives have shifted focus from big data itself to the problems that big data might solve.

Gatner found that big data investments continue to rise but are showing signs of contracting.

The survey revealed that 48 percent of companies have invested in big data in 2016, up 3 percent from 2015. However, those who plan to invest in big data within the next two years fell from 31 to 25 percent in 2016.

The online survey was conducted in June 2016 among Gartner Research Circle members. In total, 199 members participated and shared their investment plans.

"Investment in big data is up, but the survey is showing signs of slowing growth with fewer companies having a future intent to invest," said Nick Heudecker, research director at Gartner.
"The big issue is not so much big data itself, but rather how it is used. While organizations have understood that big data is not just about a specific technology, they need to avoid thinking about big data as a separate effort."

“Big data is a collection of different data management technologies and practices that support multiple analytics use cases. Organizations are moving from vague notions of data and analytics to specific business problems that data can address. "Its success depends on a holistic strategy around business outcomes, skilled personnel, data and infrastructure," added Heudecker.

Getting Big Data Projects to Production Is a Challenge

While nearly three quarters of respondents said that their organisation has invested or is planning to invest in big data, many remain stuck at the pilot stage. Only 15 percent of businesses reported deploying their big data project to production, effectively unchanged from last year (14 percent).

"One explanation for this is that big data projects appear to be receiving less spending priority than competing IT initiatives," said Mr. Heudecker. Only 11 percent of respondents from organisations that have already invested in big data reported that their big data investments were as important, or more important, than other IT initiatives, while 46 percent stated that they were less important.

"This could be due to the fact that many big data projects don't have a tangible return on investment(ROI) that can be determined upfront," added Mr. Heudecker. "Another reason could be that the big data initiative is a part of a larger funded initiative. This will become more common as the term "big data" fades away, and dealing with larger datasets and multiple data types continues to be the norm."

A further factor to consider is the lack of effective business leadership or involvement in data initiatives. Too often, pilots and experiments are built with ad-hoc technologies and infrastructure that are not created with production-level reliability in mind.

"When it comes to big data, many organisations are still finding themselves at the crafting stage," saidJim Hare, research director at Gartner. "Industrialization — and the performance and stability guarantees that come with it — have yet to penetrate big data thinking."

Gartner clients can read more in the report: "Survey Analysis: Big Data Investments Begin Tapering in 2016."

“Not just about replacing old with new”

Paul Cant, EMEA head of enterprise solutions operation for BMC Software, commented on the move: “As businesses strive to stay ahead of the competition, making innovative use of technology is no doubt a top priority for every organisation. However, as this recent Gartner survey suggests, businesses are struggling to foster the correct innovation because they are failing to capitalise upon big data in the correct way.

“It’s important to realise that in order to implement the adequate measure to achieve a successful big data strategy, one must realise that ‘digital business’ isn’t just about replacing the old with the new, it’s about harnessing technology to enhance every aspect of an organisation, reshaping and redefining it from the group up.

“Business leaders need to break free from their ‘comfort zone’ in IT, in order to add the value needed to lead innovation throughout the entire organisation. Only then will the correct perception of big data emerge”.

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www.gartner.com

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