Much has been written on the big data phenomenon – how the volume of data is exploding and how the nature of data is increasingly more complex. The importance of forming a data business strategy for solving data ownership and privacy issues, and achieving data-related know-how combined with business and customer understanding aimed at creating new business are highlighted based on our research findings. The findings are based on qualitative interview data from six companies (19 interviewees altogether).
According to case data, B2B companies face different kinds of challenges, which we have categorized into four groups: Data, Data Process Challenges, Operational Challenges and Business Development and Strategy Challenges. Overcoming these challenges may transform them into opportunities that boost the creation of new data-related business.
According to our study, the first category, Data challenges, considers the challenges related to the data itself, and especially data that relates to customers and competitors. Often this encompasses knowledge and understanding that is possessed by, e.g. sales people on the customers or industry, and is thus, not easily available for other functions or top-level decision-making. On the other hand, this knowledge seldom indicates opportunities for new business.
The second category, Data process challenges, relates to decisions on new technologies, systems or platforms, e.g. integration of data processing and analysation of systems. These determine the chances of a company being able to efficiently collect and utilize data. If this is not considered on a strategic level, companies may end up with multiple tools that – in the worst-case scenario – have closed interfaces that do not serve business development purposes. However, it is important to emphasise that alongside technologies, data-based business also requires new personnel capabilities, such as basic knowledge of data analytics.
The third category, Operational management challenges, is strongly linked to data processing, as big data means a constant and continuous data flow. This requires managerial guidelines for the ownership of data, data storage location, IPR issues, contracts and data security as well as the compatibility and integration of different kinds of data sets and analyses in a flexible manner. Although these are more like general data management questions than new business development issues, these basics are now especially topical due to the General Data Protection Regulation (GDPR) that entered into effect on 25 May2018. From a customer point of view, company operations, in terms of data collection and exploitation, need to be transparent and reliable, as the customer trust is at stake.
Last, but not least, is the category of Business development and strategy challenges, which relates to strategic decisions, the value of data and knowledge and the impact on business. Implementing data-based business in a systematic manner calls for creating a data business strategy and top-management involvement. Harri Ketamo, the founder and chairman of Headai, a cognitive AI company, summarizes this perfectly:
“This is not an IT project, this is not an HR project, this is management group’s project.”
This blog post is based on:
Rantala, T., Palomäki, K. & Valkokari, K. 2018. Challenges of creating new B2B business through big data utilization. The ISPIM Innovation Forum, Boston, USA, 25-28 March 2018. The paper won the Innovation Management Impact Award that is awarded for the best paper of the conference.
This study is part of the Business Finland funded BIG (2017-2019) project