Big Data is a common catchphrase in the business world today. In reality, it is far from a buzzword, however; it is radically changing the traditional perception of data. Big Data has started transforming the decision-making process of entire organizations. Exponential data growth, fueled by connected devices and end points that make up the Internet of Things, has compelled organizations to revisit their ability to use Big Data to make more intelligent, real-time decisions. Considering the hyper-competitive business environment, this critical need has given rise to a new breed of analytics solutions focused on prediction, data visualization, and dynamic decision making.
Current Adoption in Latin America
Though still nascent in Latin America, we can already find some initiatives from enterprise companies investing in Big Data. According to Frost & Sullivan’s Strategic Analysis of the Brazilian Companies Investments in ICT, conducted with more than 300 companies in Brazil, 10% of Brazilian companies have already invested in Big Data, mostly in planning and consulting projects, thus building roadmaps to understand how they can take advantage of the data.
Moreover, Frost & Sullivan’s recent study based only in Big Data Analytics in Latin America was able to measure three of the most important countries in terms of investments: Brazil, Mexico and Colombia. The revenue of these three markets together was US$603.7 million in 2014, confirming that companies are already making significant investments in Big Data. Revenue is expected to reach $2.346 billion by 2019 at a 31.2% compound annual growth rate (CAGR), and, starting in 2015, companies will enter in a phase of investment in infrastructure and software in order to create an environment that can manage and analyze all data. In Brazil for example, by the end of 2015, one of every three Brazilian companies will have invested in Big Data.
Latin American companies will have to change their mindset in order for the Big Data market to maintain its current rate of expansion. Nowadays companies are not used to applying analytics to take business decisions and this hinders their investments in Big Data, which in addition is not yet considered as a priority for many CIOs. Investments are still requisitioned mostly from other business departments such as marketing, sales and procurement.
Besides, this is not the only challenge: the lack of market education and consensus of what Big Data is and how providers offer it confuses potential buyers. On top of that, many current solutions offered by the vendors require extensive IT expertise from customers. Because of the low concentration of these experts in the Latin America market, some companies are hiring high-skilled IT professionals from the United States to speed up projects.
Despite all these challenges, implementations are being executed by some companies. Enterprise companies from financial and telecommunications segments are traditionally the first ones to invest in new technologies and Big Data is not the exception. Companies in these segments spent the last two years investing in structuring Big Data departments inside their businesses and creating a roadmap to start changing the way decisions are taken. Since these companies already had a lot of customer information that was not being used, so far most of their efforts have been related to the exploitation of relevant data to improve customer experience and retention rates. Retailers are not yet at the same implementation level, but they have shown the same interest and would like to use Big Data to improve their sales, especially in their online channels.
Latin American governments are also walking towards Big Data. Investments to improve data security along with sensor data analysis are being considered to transform some cities in smart cities. A bigger involvement of the Latin American citizen is also making governments in the region invest in data transparency, making information available to whoever may be interested. The usage of social media analysis is also another area with higher investments, especially during the election processes.
The demand for Big Data and Analytics is growing rapidly in Latin America, but instilling a Big Data culture is a change in management initiative that will take time inside organizations. Both business and technology leadership should be in charge of reinventing the way data has been handled so as to exploit the value that can be generated from Big Data initiatives. On the other side, providers need to have enough data experts ready to provide services and future implementations for these companies.