South Africa Magazine looks at business analytics, the social media boom and what it means for business.

By Ian Armitage

IT is no longer a back-office function, but a driver of growth and a way for businesses to add value.

And businesses are pursuing analytics solutions to improve decision-making and operational efficiency.

It is fast becoming an integral part of how business is done in Africa.

“Firms that understand the deeper potential of technology [to enable change] will gain competitive advantage,” says Shane Radford, Business Analytics and Optimisation Lead, IBM Global Business Services. “Technology can help you adapt to today’s competitive economic landscape, and all its change and complexity.”

Large companies have their hands full with terabytes and terabytes of data flowing in, Radford says.

Smaller, midsize companies are bracing for the data tsunami as well.

A recent IBM Institute for Business Value 2011 study -- The Essential CIO -- based on conversations with more than 3,000 chief information officers (CIOs) worldwide revealed that business analytics (the ability to extract actionable insights from “Big data”) tops priorities at midsize companies.

83 percent of midmarket CIOs, in fact, say mastering analytics is a priority, the study says.

“Businesses are looking to invest in technologies such as analytics and data mining that not only help them better utilise structured data, but also unstructured data in the form of videos, blogs and tweets that can be obtained through the social web,” Radford says.

This is about turning data into usable intelligence and using it to add new sources of revenue.

“Business Analytics and Optimisation (BAO) can help generate and give access to customer preference data, supply chain patterns, emerging trends - both within organisations and from competitor, Internet behaviour and response patterns, and so much more,” Radford says.

The amount of information in the world is increasing at an almost exponential rate – and knowledge is power, especially in business.

Most of this information, however, in this modern age, is what the tech-savvy call unstructured data.

Unstructured data is things like emails, YouTube videos, word documents, web pages, audio recordings or PowerPoint presentations, even Tweets.

Ah yes, tweets. The social media scene is booming (it is increasingly difficult to escape from Facebook, Twitter and any number of other social networking sites); you simply can’t get away from it. And as social media becomes increasingly prevalent in everyday life, it is also having a large effect on the world of business.

Amazingly, the social network is an untapped information asset in most organisations.

“You have to be able to capture that data,” Radford says. “This unstructured data is being created constantly, especially on social media. Social network analysis serves up business intelligence on the ties, information flows and value exchanges that can be extremely valuable to businesses. Of course, you still have the structured data, which computer systems of the past were explicitly designed to monitor, and that tends to consist of numbers and other information that can be easily categorised and searched.

“Unstructured data is difficult to search and categorise,” he explains.

The key is making sense of seemingly unconnected pieces of data, making connections between possibly unrelated pieces of information and coming to solutions that could benefit your business.

And this is a key part of IBM’s approach to analytics, instead of simply looking at basic sets of data, analytical systems are built to incorporate information from a variety of sources.

“The future is not one where computer systems will only work with data that is formatted for them; systems will have to be interconnected, instrumented and intelligent,” Radford says. “A key element is the intelligence of the system.”

Why do we need computers and systems to do this for us? Well, could you imagine doing it yourself? No. Logging all your emails, for example, would take a lifetime. There is simply too much information and it is impossible for single people to process everything.

“This data enables BAO and by applying business analytics to a particular problem it will be easier to identify areas within a company -- be it private or public -- that could benefit from a closer investigation,” Radford says. “The emergence of new smarter systems which are interconnected and streaming real time information are presenting business and governments with a unique opportunity to transform decision making.

“Opportunities to use this data in Africa to predict business outcomes, optimise old systems and spot trends before they happen are a reality.”

According to recent IT industry analyst reports, enterprise data growth over the next five years is estimated to increase by more than 650 percent. Some 80 percent of this data is expected to be unstructured.

“IBM is designing systems that incorporate “Big data” for better decision making, and optimised systems tuned to the task and managed in a cloud,” Radford concludes. “We help customers prepare for tomorrow.”

For more information visit www.ibm.com/za/en/

Image: Getty