Big Data: it’s relevant for SMEs too

Posted on Thursday 28th June 2012 4:33

According to a report published this week by the software giant SAP, while just 25 percent of SME executives agreed on a definition for Big Data, they still expect it to have a massive impact on their businesses. No less than 70 per-cent of the US based businesses questions said that they would expect a return on Big Data investments in just one year.

These findings are in line with analyst expectations for the sector. IDC, for one, believes “big data” is ramping up to be a big business opportunity, with the analysts estimating that companies will spend $120 billion on data analytics software between now and 2015. Yet we have to ask the question of whether software giants like SAP really offer the best solutions to many SMEs.

As the popular term for software and services that analyse the vast amounts of structured information in company databases alongside unstructured data from sources likes social networks or sensors, big data has captured the imagination of many software giants with their eyes on the next big thing. Yet the majority of services and solutions currently on offer that enable companies to take advantage of the data within their businesses are resolutely aimed at the enterprise level. IBM alone has spent $14 billion putting together an armoury of big data products and services, while SAP announced major developments to its platform earlier this month.

The downside to many of the big data solutions that the likes of SAP and IBM have assembled by acquisition and by leveraging their own hefty platforms is that they are currently too pricey and complex to be relevant to SMEs’ needs. Consequently, resellers and systems integrators anxious to get a slice of the big data business for themselves are faced with an unenviable choice. Either they go head-to-head with vendors for enterprise-level business, or attempt to convince the IT director of a 300 person operation that they need a software system specified for use in a business ten times their size.

Even comparatively small companies now are in possession of huge databases of customer, logistical or product information sitting around on their servers that represent unlocked value. They need answers to this problem. Yet the very inability of big vendors to anticipate demand for big data solutions scaled to the needs of SMEs represents a major business opportunity for the channel, which it can respond to in three ways.

1. Create New Solutions

If there isn’t a solution relevant to your customers’ needs currently on the market, why not create one? After all, channel providers represent a wealth of knowledge and insight into the IT needs of the businesses who account for the vast majority of global economic activity. This intelligence can, when combined with the expertise of a software development team, form the basis of new big data packages tailored to the needs of specific vertical markets. By entering into joint ventures with emerging software vendors, or even by diversifying the capabilities of their in-house teams, channel providers could create a new category of big data products engineered for a greater range of users.

2. Consultancy and Vendor Selection
A key area where SMEs look to channel providers to add value in the IT procurement process lies in helping them select the right vendor. As industry insiders, channel providers are well aware of the strengths and weaknesses of big data solutions offered by the major vendors, and this expertise could in itself represent a source of new business. By selling customers which are wavering over implementing a big data solution a vendor selection exercise in the first instance, a channel provider can not only help companies make the right decision, but also position themselves well for picking up valuable consultancy business further down the line.

3. Big Data As A Service
Whereas many companies will require a fully-fledged big data solution hosted on their premises and available at all times, many more SMEs’ needs will be more modest. For those businesses that stand to benefit from running sophisticated analytics on their data, but would only need to access these services every month or once a quarter, an off-premises solution makes better sense. And this is yet another way for channel providers to get in on the game by offering customers ‘big data as a service’. Here customers would access big data analytics platforms hosted on a channel provider’s own servers on a ‘pay as you go’ basis.

A fitting analogy for the state of big data services today would be the CRM landscape five years ago. Here, a monolithic market dominated by a few big software companies compelled big businesses to pay high prices for often over-complex and unsatisfactory CRM systems which were out of the reach of SMEs. It took the disruptive power of start-up companies like Salesforce to shake up the market with browser-based, more flexibly priced alternatives that made CRM at last seem manageable.

IBM, SAP et al’s determination to crack the enterprise-market leaves the field wide open for smaller and nimbler competitors, many of which will arise in the channel to create a new category of big data (perhaps Big Data As A Service) products engineered for a greater range of users. By acting as the key point people between user and vendor, channel providers have an integral role to play in taking big data from being a buzzword to behemoth.