Big Data and the Virtual Value Chain

I recently worked on a Big Data project. It was exceedingly interesting. The thing that struck me was the need for a company to have a business case for Big Data. Any investment needs a business case, otherwise why do it? It is difficult to justify an investment by saying that there could be benefits from our data, “we just don’t know what it is,” could be a pretty big risk.

So how do you go about deriving a tangible benefit to justify an investment in Big Data? Thankfully, Jeffrey F. Rayport and John J. Slovakia have defined a way of Exploiting The Virtual Value Chain. In summary they note that any business system will gather, organise, select valuable information, synthesis new data and deliver data. They call this the virtual value chain. They see doing this in three areas. These are visibility (better management information about physical processes),  mirroring (replacing physical elements of value chain with virtual ones) and creating new customer relationships (provide value to customers through new positions).

So…

• Step 1: Understand your external environment with perspective on data
• Step 2: Understand the virtual value-chain within the business system
• Step 3: Look for opportunities to exploit visibility, mirroring, or defining new customer relationships
• Step 4: Identify enough opportunities to justify investment in a Big Data business system to develop future propositions
• Step 5: Deliver opportunities
• Step 6: Go to 1

Core to the process is Step 4; the creation of and ongoing funding of a Big Data business system (not just a technology platform). It is through this system that the promise of “Big Data” can be delivered.