Big Data = Business Strategy for Utilities
Data…smart meter data, weather forecast data, operational sensor data, machine data (RFID tags, system sensors, network switches, etc.), geospatial data, enterprise application data (billing, CRM and ERP systems, etc.), human data (website data, social media, etc.)…there is no end to the volume and variety of data entering today’s utilities, not to mention the velocity at which this data arrives.
It would seem no wonder, then, that utilities are looking for ways to unlock the value of this data. But big data is not software or a product or even a technology. It’s a business strategy. Big data is a long-term, executive-level commitment to treat information as a strategic asset with IT providing the resources needed to bring it to life.
To leverage big data, IT and line-of-business (LOB) organizations must align their missions and work toward a commonly defined goal. The IT organization needs to focus on how best to manage the data in order to remove operational uncertainty and unpredictability, prerequisites for operational excellence. At the same time, the LOB organization needs to focus on how to extract the most value from the data to benefit the business.
Unfortunately, in the rush to evaluate software products and solutions, business needs and requirements are often overlooked. Organizations that adopt big data need to recognize it as a strategy that represents the information needs and analytic requirements of the business, with a view of both near- and longer-term needs.
As a first step in adoption of a big data strategy, the operational and functional areas of the business need to understand what big data means to their organization. They must establish a knowledge base that focuses on the information needs of the business in order to develop a business strategy that is rooted in big data.
Specific business use cases and imperatives need to be explored and prioritized in order to determine which will drive the most value to the enterprise and which will realize the greatest impact and benefit of a big data strategy. Additionally, an assessment should be done to determine the current capabilities of the IT infrastructure and the ability to support this newly defined information-centric, big data strategy.
Recommendations can then be developed around how to better leverage the current infrastructure, how to fill gaps in current capabilities, and how to create an infrastructure that meets the current and long-term information and analytic needs of the business.
The most effective big data strategy needs to be a fact-based, decision-making platform that is built upon a detailed assessment, evaluation and prioritization of the short-term and long-term information and analytic needs and requirements of the business. The goal of big data is to extract the potential value locked in the volume, velocity and variety of the data that streams into the utility.
In the not-too-distant future, we will recognize those utilities that are successful at defining effective and impactful big data strategies as industry leaders! In fact, a 2012 research study by Saïd Business School of University of Oxford and IBM Institute for Business Value showed that 63% of organizations that apply analytics – such as they gain from a big data strategy – create a competitive advantage.
To learn how IBM can help utilities manage smart grids and smart meters, read our white paper: Managing big data for smart grids and smart meters
Watch this brief animation – Big Data, Big Opportunities: Energy & Utilities