Most big data projects aren't profitable, claims Capgemini

Especially if IT is in charge, claims new report

The majority of big data projects don't glean sufficient insights to be labelled profitable, according to consultancy Capgemini and business intelligence company Informatica.

That was one the eye-opening findings in The Big Data Payoff report, produced by the two companies, and covering some 200 senior IT and data management executives at major organisations.

Only 27 per cent of organisations admit to having run profitable big data projects, 51 per cent of them relating to achieving improved customer satisfaction and retention.

Other business benefits cited by those generating profits from big data projects included improved decision making (38 per cent), improved collaboration and information sharing (35 per cent), and improved productivity (33 per cent).

While not all are profitable, the majority are at least not losing money. Some 45 per cent said that their efforts are breaking even, and 11 per cent said they are losing money. Twelve per cent said it was too soon to judge.

One major differentiator is the level of support from other executive leaders. Around 49 per cent of those that have achieved profits from a big data project said they had strong executive support, compared with just six per cent that did not have support yet had still made big data projects financially beneficial.

The survey also found that chief operating officers or chief digital officers in charge of big data projects are more likely to generate profits than chief information officers, perhaps underlining that a financial-oriented attitude is crucial when running such initiatives.

Despite this, big data projects are still seen as the bastion of IT, and 52 per cent of respondents said that the CIO has responsibility for big-data projects.

However, this is starting to change as other C-level executives get involved, including the chief technology officer (17 per cent) and chief marketing officers (16 per cent).

Mark Powell, UK head of insights and data at Capgemini, said that deriving benefits from big data is a business-wide concern and not just something for the IT team. "In order for big data to truly take off, businesses need to stop looking at it on a project-by-project basis and something just for the CIO to deal with," he said.

"Big data needs to be integrated into every aspect of the business, helping to drive the next level of digital transformation and, more importantly, business transformation.

"Integrating it in the overall business strategy helps to transform the entire business and open further opportunities across the board, rather than just from an IT perspective."

The difficulty of ensuring that big data projects make money has been raised before. Visa said last year that firms embarking on big data initiatives need to have a clear business goal in mind before they begin.

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