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April 15, 2013

The data dilemma: Why small and mid-sized firms struggle with data (Part 1)

While the Big Dogs are dealing with ‘Big Data‘ (a collection of data sets so large and complex that it becomes difficult to process using on-hand database management tools or traditional data processing applications), the rest of the small to mid-sized companies are still struggling with the basics.

At Blue Door Consulting, we see this data dilemma daily. How does a 300M, 35M or 3M dollar company use its data to compete? Frankly, it’s a struggle for them – the extraction, analysis and application of their data is an overwhelming endeavor for the average company.

I propose some solutions. (See Part 2 of this post-coming soon.)

But before I convey my Earth-shattering thought process, let’s delve more deeply into the typical obstacles facing small to mid-sized firms as experienced by my team. Ironically, many of these seem to be the same obstacles facing large business, but they tend to have more resources.

  1. The CEO says ‘I need data!’ But, ‘What data?’ is usually the response. There is an inability to articulate what data is needed; instead the philosophy is that if the data is merely presented, the problem will be revealed.
  2. The IT team says ‘We’re not currently collecting that data or we have to build the infrastructure to house that data.’ As the infrastructure/database keepers of the data, the IT team builds out the platform, but often has a challenge understanding what data should be captured, how it will be mined and the process for its extraction.
  3. The customer service representative complains ‘This data profile is incomplete; I can’t answer the person’s questions.’ Garbage in. Garbage out.
  4. The marketer says ‘I don’t know how to pull the data from the database.’ The gap between the data and its mining is significant. Many times the data exists, but not in an easy, retrievable system.
  5. The human resources recruiter says, ‘A business analyst isn’t in our staffing budget.’ While this position will be a ‘must-have’ in the future, many small and mid-sized companies don’t see the value in having a person dedicated to this role today.

At all stages of this ‘Data-to-Information-to-Knowledge Process,’ challenges exist. It isn’t just one obstacle to overcome; it’s at every data touch point. If companies can’t transform existing data into information and then into knowledge, the ability for these companies to succeed in our data-driven market will become further diminished.

As data ambassadors, we need to do a better job educating and arming small to mid-sized companies with best practices and processes to ensure they are sustainable tomorrow.

Feel free to weigh in on your thoughts regarding additional challenges you see, trends or solutions and I’ll include them in my Part 2 as I address how to help small and mid-sized businesses get the most out of their data!