How many chiefs does it take to invest in big data? If you haven't already, it's time to add CFOs to that list.
"We used to see big data as a CIO-IT cost consolidation problem. In fact, the debate has completely shifted. It's all about revenue, growth and enhancement," said Jo Tango, co-founder and partner at venture capital firm Kepha Partners. "I would argue [that], in the big data age, CFOs have even more power and leverage as the people who write checks."
Tango was a member of the big data panel at the recent 2014 CFO Technology Conference sponsored by The CFO RoundTable's Boston chapter. There, financial executives heard about the hope -- and hype -- of big data analytics. Simon Moss, CEO and president of Pneuron Corp., for one, believes the big data conversation needs to be bifurcated.
"We have to deal with the fundamental facts that the vast majority of individuals and companies that have data don't have a big data problem. They have a distributed data problem," he said. According to Moss, 70 cents of every project dollar is spent on "identifying, normalizing, moving, storing and optimizing data in some sort of data construct." The mechanics of getting the data in shape for extracting insight eats up most of the funds.
"My argument is that we have to look at that before we really begin to unlock the waves of innovation people are talking about," he said.
Moss has a vested interest in identifying the big data problem in these terms. His Nashua, New Hampshire company, an Innovation Showcase finalist at this week's MIT Sloan CIO Symposium, offers a platform to connect data sources from across the enterprise.
Product news aside, Moss' message is good news for CIOs. He made a strong argument that CFOs need IT to extract value from big data. And to do that, the business needs to free up IT from the mundane chores of collecting and cleaning up data.
"The business may be institutionally frustrated, but the IT guys are pulling their hair out because they're driving their teams at 140-150% productivity," Moss said to the roomful of CFOs. "They've constantly got businesses coming to them and [are] saying, 'We need to do this today, and by the way, here are all new regulatory adherences we need to apply to that framework,' -- and there's enormous frustration on both sides. One way or another, it's going to break, and we've just got to work out how to break it the right way."
Build a house of cards and ditch your ad firm
Businesses are always trying to figure out how to get more eyeballs on the brand, but that has become increasingly difficult. "TV ads? No one watches TV ads anymore," Brian Halligan, CEO and co-founder of inbound marketing software company HubSpot Inc., said.
Halligan, the opening keynote speaker at the CFO Technology Conference, recommended businesses stop "renting" advertisement space and start building their own. To do so, marketing departments will have to invest in "creative teams" to produce "brilliant content," he said, which today can be done on the cheap by leveraging online platforms.
An example? Coca-Cola's website. Part of the site's 2012 refresh included the revival of a defunct employee magazine. Today, Journey acts as the company homepage, featuring daily posts -- in the form of Q&As, videos, customer stories -- for employees and customers alike. That's the kind of "content marketing" success story that's creating water cooler (and panel) conversations for another C-level executive: the chief digital officer.
"I think the next level of this will be when a company like Coke or someone at that level puts out their own House of Cards," Scott Schneider, chief digital officer for PR firm Ruder Finn Inc., said during a recent Chief Digital Officer (CDO) Summit panel discussion.
Previously on The Data Mill
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Ten open data examples to get CIOs thinking
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Where does the CIO fit into all of this? A marketing campaign this involved isn't about content alone, these gurus said. It requires a boatload of technology and hands-on help from IT experts.
Even then, panelists cautioned, most companies won't have the breadth and depth of either branding or budget to pull this off in the near future. "Let's look at the competition," Steve Rubel, chief content strategist for PR firm Edelman Inc., said at the CDO Summit. "The competition isn't Coke versus Pepsi. The competition is Angry Birds, it's Candy Crush, it's media properties, it's Hollywood, it's Bollywood. It's broad. We come at this somewhat wide-eyed in our abilities and say, 'Sure, we can do this.'"
So what's the path to success? Rubel predicted companies will start forming what he called "unholy alliances." "We are going to see a lot of companies you'd never think about getting together [to] work together," he said, pointing to the rapper Pitbull. "He seems to collaborate with every artist; you hear his voice as a track in every song. That's a great model we should be thinking about as communicators. It is about surface area."
"The last thing your companies want to do is automate the way they market today. The opposite of automation is transformation. Almost every company needs to rethink their marketing from the ground up and match the way they market to the way people actually shop and buy stuff." -- Brian Halligan, CEO, co-founder, HubSpot Inc.
"We have made massive advances in computational mathematics, in analytics, in distributed visualization, in technology end points, in iPads. We are still using exactly the same data aggregation approaches we have done in the last 30 years." -- Simon Moss, CEO and president, Pneuron
"The way I look at big data analytics is it's not a technology, it's not a tool you buy, it's not even a team of data scientists you acquire. It's a new way of doing business." -- Nathaniel Lin, founder and president, Analytics Consult LLC